Royal Dutch Shell Plans to Limit Spending

Royal Dutch Shell Plans to Limit Spending

Oil giant Royal Dutch Shell plans to increase cost savings to $4.5b following its $54b acquisition last February of BG Group, which Chief Executive Officer, Ben van Beurden, said will make it the best oil company investment, ahead of Exxon Mobil, Reuters reported.

Shell unveiled plans to limit spending and exit countries in order to focus on the most profitable operations such as liquefied natural gas (LNG), deepwater oil production and chemicals. The company also detailed longer-term plans to grow its shale oil and gas production and green energy as it switches to cleaner resources.

Britain’s largest company is adjusting to a lower oil price while maintaining its commitment to paying a dividend to shareholders worth $15b a year, The Telegraph wrote.

Ben van Beurden hit out at critics of the BG Group tie-up, at Shell’s capital markets day in London, arguing its cost savings were almost double what was forecast when it offered to buy the group in April 2015.  “The BG deal is an opportunity to accelerate the re-shaping of Shell. Integration is gathering pace, and today we expect to deliver more synergies, and at a faster rate,” van Beurden said.

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