SHELL
posted record profits of $7.4
billion (£4.2 billion) for its
third quarter yesterday and said
it had survived America’s worst
hurricane season with limited
damage, enabling it to reap the
benefit of exceptional oil price
gains.
As the Dutch multinational
revealed its extraordinary
harvest, ExxonMobil, its
American sister, also announced
a record quarterly profit of
$9.9 billion. Together, the
profits earned by the world’s
top three oil companies,
including BP’s $5.3 billion, in
just three months exceeded the
annual income of Sri Lanka in
2004.
Boosted by record oil prices
that averaged more than $60 per
barrel during the three months
to the end of September, the
combined sales revenues of BP,
Exxon and Shell for three months
were some $300 billion, greater
than the GDP of Austria last
year.
Shell’s third-quarter
profit included an exceptional
gain of $1.6 billion from asset
sales. Excluding the gains from
the disposal of Gasunie pipeline
assets and the sale of Basell,
the petrochemical joint venture,
The oil group’s third-quarter
replacement cost profit
increased by almost a third to
$5.8 billion.
Jeroen van der Veer,
Shell’s chief executive, said he
was pleased with the results and
predicted that Shell’s output of
oil and gas for the full year
would be 3.5 million barrels per
day, ahead of City expectations.
“We captured the benefit
of high oil and gas prices even
after absorbing the impact of
the hurricanes in the US,” he
said.
Hurricanes Katrina and
Rita swept through key Shell
production areas in the Gulf of
Mexico, severely damaging Mars,
Shell’s largest facility in the
region. Peter Voser, Shell’s
finance director, said that Mars
would be out of action until the
second half of 2006. “Mars was
exposed to winds of 175 miles
per hour,” he said.
The total cost of the
hurricanes to Shell’s oil
production and refining
activities in the Gulf will be
$350 million spread over 2005
and 2006, but Mr Voser hinted
that significant compensation
would be recovered from
insurers.
Shell has recruited 1,000
staff this year to boost the
ranks of its professional and
technical personnel. Mr van der
Veer admitted that salary rates
at Shell were increasing.
