Shell Looks for Tighter Grip on Upstream Americas Operation
When it comes to investment, Shell plans to maintain its existing cash "engines" businesses. Where the Upstream business is delivering high returns and strong cash flow, the firm aims to concentrate on improved operational uptime and selective growth. In the near-time, it plans to deliver cash flow from growth priorities, such as deep-water projects.
In the long term, Shell plans to identify and mature future opportunities in Nigeria, Iraq, Kazakhstan and other global resource plays.
"Shell has considerable strengths in portfolio, technology and management capabilities. However, we must improve profitability in several areas," van Beurden added.
"We are taking stock of our investment opportunities and operating positions. Are our assets attractive economically, and are they resilient to industry cycles? Are our plans credible, are they competitive and are they affordable? This approach is driving hard choices on today's asset base, new opportunities, and disposals plans, where we have recently announced exits from Australia and Italy downstream, Wheatstone LNG [liquefied natural gas] in Australia, and US gas-to-liquids."
Shell said that its $35-billion organic investment program for 2014 reflects an ongoing commitment to grow the company. Meanwhile, the firm has sold $4.5 billion of assets so far in 2014 as part of its $15 billion divestment program for 2014/2015.
Shell previously announced in late January that this year would be one of "hard choices" about new projects as it indicated it would spend no more than $37 billion on capex in 2014 after spending $46 billion in 2013.
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