Russian Shell exit ‘spicy’ priced | Financial

The write-off is more than $3.4 billion in assets held in the companies and its downstream operations in Russia. “A write-off like this is really tough”, says stock trader Cees Smit of Today’s.

Shell is writing off its 27% stake in the Sakhalin II oil and gas exploration project.

In addition, Shell is also exiting the controversial Nord Stream 2 gas pipeline of $9.5 billion in investments at the time, where it partners with Gazprom and has a 10% interest in it.

In March, Shell announced its departure from Russia after British BP and Norwegian Equinor.

These costs will not affect the adjusted profit, according to the company, which has since become fully British.

According to Bloomberg, Shell has also refrained from hiring two LNG ships working for Russian companies.

Cash flow hit

In Thursday’s update, Shell warns that the operating cash flow will be negatively affected by the ‘very high’ outflow of working capital. The company with a market value of $189 billion has $7 billion in outflows.

Last quarter it processed about 2 million barrels per day. It expects more revenues from the trade of gas products, compared to the fourth quarter of 2021.

In the update, Shell also reports a redistribution for the reporting: results for gas are separated from the Renewables & Energy solutions department. Oil and chemicals are divided into two separate divisions, Marketing and Chemicals & Products.

Under pressure

Shell is under pressure from shareholders to split the group into a company that sells the ‘old’ fossil fuels and part for new forms of energy. In the first quarter, the profit for the latter part will be between $100 and $600 million, Shell reports.

The stock rose 29.5% this year, driven by high oil and gas prices. The AEX fell 10.2% this year.

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