Shell Forecasts Up to $4.5 bn Impairment Charges in Q4, Eyes Sale of Singapore Hub

By Editor


Shell revealed on Monday its anticipation of impairment charges reaching as high as $4.5 billion for the fourth quarter, primarily tied to the Singapore refining and chemicals hub that the oil major aims to divest.

Preceding the forthcoming fourth-quarter financial report scheduled for Feb. 1, the company outlined expectations of significantly heightened gas trading results compared to the previous quarter, while projecting notably reduced oil trading outcomes for the same period.

Shell said its liquefied natural gas (LNG) production volume projections range between 6.9 and 7.3 million metric tons, slightly surpassing prior guidance. This development follows Shell’s recent resumption of production in late December at the massive Prelude LNG facility off Australia’s coast, following a four-month maintenance hiatus.

The company estimates its upstream production for the fourth quarter to fall between 1.83 to 1.93 million barrels of oil equivalent per day.

However, Shell anticipates an adjusted earnings loss within its chemicals and products division for the period.

Shell disclosed intentions to record non-cash, post-tax impairment charges ranging between $2.5 to $4.5 billion during the quarter.

Among these charges, up to $2.1 billion is allocated to the 237,000 barrels per day (bpd) refinery and a 1 million metric ton per year ethylene plant situated on Singapore’s Bukom and Jurong islands. Last year, Shell had announced a strategic review for these facilities.

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