LNG giant Shell reported a rise in its adjusted earnings in the first quarter, while its LNG sales dropped when compared to the same period in the year before.
The firm said its adjusted earnings reached $9.64 billion in the quarter, a rise compared to $9.13 billion in the year before. Adjusted earnings dropped 2 percent compared to $9.81 billion in the prior quarter.
Income attributable to Shell shareholders was $8.7 billion, compared with $7.11 billion in the first quarter last year and $10.5 billion in the previous quarter.
Compared to the prior quarter, income attributable to Shell shareholders mainly reflected unfavorable tax movements, and lower realized oil and gas prices, Shell said in the report.
It also included impairment charges of $0.5 billion and these charges are included in identified items amounting to a net loss of $0.5 billion in the quarter.
Cash flow from operating activities for the first quarter was $14.2 billion, and included a working capital outflow of $0.8 billion, and tax payments of $3.1 billion.
“In Q1 Shell delivered strong results and robust operational performance, against a backdrop of ongoing volatility, while continuing to deliver vital supplies of secure energy,” CEO Wael Sawan said.
“We will commence a $4 billion share buyback program for the next three months as part of our commitment to deliver attractive shareholder returns,” he said.
LNG sales and liquefaction volumes down
Shell sold 16.97 million tonnes of LNG in the January-March period, a drop when compared to 18.29 million tonnes in the same period last year. Sales rose by 1 percent compared to 16.82 million tonnes in the prior quarter.
Liquefaction volumes dropped by 10.1 percent year-on-year to 7.19 million tonnes in the first quarter.
However, liquefaction volumes rose 6 percent when compared to 6.78 million tonnes in the prior quarter.
Shell said liquefaction volumes were higher than in the prior quarter mainly due to higher uptime at its Prelude FLNG in Australia.
The firm expects liquefaction volumes to reach about 6.8 – 7.4 million tonnes in the second quarter.
Total oil and gas production, compared with the fourth quarter 2022, increased by 6 percent to 970,000 barrels of oil equivalent per day mainly due to lower maintenance at Prelude, and the ramp-up of new fields, partly offset by higher fields decline, Shell said.
Integrated gas earnings
The company’s integrated gas segment reported adjusted earnings of $4.91 billion in the first quarter.
This compares to $4.09 billion in the same period a year ago and $5.96 billion in the prior quarter.
Compared with the prior quarter, integrated gas earnings reflected the effect of lower realized prices and unfavorable deferred tax movements, partly offset by higher volumes, and lower operating expenses, Shell said.