July 26 - Shell results kick off a bleak quarter for oil majors as weaker oil and gas prices take their toll. Hayley Platt reports.
It's the world's second largest oil producer but weak oil and gas prices in North America have taken their toll on Royal Dutch Shell. Earnings in the second quarter fell to around $6 billion from $8 billion a year ago. The Group's CEO Peter Voser also blamed higher maintenance costs and production outages in one of its most profitable regions. SOUNDBITE: Peter Voser, CEO, Royal Dutch Shell, saying (English): "During the second quarter we had routine shutdowns and it was mainly done in the Gulf of Mexico which is crude which normally gives you a lot of high price upsides and therefore we are missing those revenues these are planned shutdowns, two of them are back on stream now and the third one is now in maintenance so the third quarter will be affected by that as well." Shell has been battling competition from Asian rivals as well as coping with volatile oil prices. Last week it shocked investors by pulling out of the race for Cove Energy, clearing the way for the much smaller Thai firm, PTT. But Voser says the business is on track. SOUNDBITE: Peter Voser, CEO, Royal Dutch Shell, saying (English): "We have more than 20 projects on stream and another 30 to come and we have a steady investment flow. We have a very competitive dividends. We generated $13 billion of cash in the second quarter and therefore we have only an 8 percent gearing so the machine is producing the money." Shell has plans to drill exploratory wells in the remote Arctic waters off Alaska. But progress is being hampered by stubborn sea ice and its failure to secure key regulatory approvals. Hayley Platt, Reuters