Shell share price: Group scraps £4.27 billion project in Qatar

on Jan 15, 2015
Updated: Feb 27, 2024

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Royal Dutch Shell Plc (LON:RDSA) has scrapped plans to build a $6.5 billion (£4.27 billion) petrochemical plant in Qatar, making it one of the first major oil projects to be canceled as a result of the six-month long plunge in crude prices.

According to a release on the group’s website, Shell and Qatar Petroleum have decided against proceeding with the development of the Al Karaana petrochemicals project. The two companies, which formed a partnership for the plant back in 2011, said yesterday that they decided not to proceed as it was “commercially unfeasible” in the current market conditions.
The collapse of crude oil prices from more than $100 back in July Shell received US government permission to export lightly processed oil , but the FTSE 100 major said it would only start exporting processed condensate when it was sufficiently profitable.

Bloomberg cited Riyadh-based John Sfakianakis, Middle East director at Ashmore Group Plc., as saying: “The region is beginning to reduce its capital expenditure for petrochemical and hydrocarbon expansion, and that is expected given that oil prices have plunged”.
As of 10:30 GMT, Shell’s share price was trading 0.20 percent down at 2,004.00p. The stock of Europe’s biggest oil company has declined over 16 percent during the past six months as part of a recent industry-wide downtrend with tumbling crude oil prices pressuring energy shares. According to CNN Money, the consensus forecast amongst 36 polled investment analysts covering Royal Dutch Shell has it that investors should buy shares in the company.
As of 12:22 GMT, Thursday, 15 January, Royal Dutch Shell Plc ‘A’ share price is 2,014.00p.

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