Shell to further write-down up to £3.39 billion of oil and gas assets

In an announcement on Monday, Royal Dutch Shell plc (LON: RDSA) expressed plans of writing down £2.64 billion to £3.39 billion worth of oil and gas assets to combat weaker outlook fuelled by the Coronavirus pandemic that has so far infected more than 77 million people worldwide and caused over 1.7 million deaths.

Shell opened about 4% down in the stock market on Monday and slid another 1.5% in the next hour. Including the price action, shares of the company (learn more: how to buy stocks for beginners) are now trading at £13.12 after recovering from a year to date low of £9 per share in the last week of October. Shell had a per-share price of £22.56 at the start of the year.

Shell is scheduled to report its 4^th quarter results in February

Shell is scheduled to publish its financial update for the fourth quarter on 4^th February. On Monday, Shell attributed the post-tax charge to impairments related to the closure of refineries, its Appomattox field (U.S. Gulf of Mexico), and LNG contracts.

The world’s largest LNG (liquefied natural gas) trader booked a little under £750 million of write-down on its LNG portfolio in October. The write-down was primarily attributed to its Australian flagship project, Prelude.

In the second quarter, the British-Dutch multinational booked another write-down that was valued at £12.67 billion as it significantly slashed its price outlook for the future. The write-down in Q2 also included Prelude.

Shell sells a minority stake in its Queensland Curtis LNG facilities

The oil and gas company said on Monday it will sell a 26.25% stake in its Queensland Curtis LNG (QCLNG) facilities for £1.88 billion to Global Infrastructure Partners Australia.

The move is expected to help the Hague-based company hit its target for annual divestments. According to Shell:

“This decision is consistent with Shell’s strategy of selling non-core assets in order to further high-grade and simplify portfolio.”

The oil and gas company also highlighted on Monday that some of the restructuring-related charges will be realised next year. In an announcement late in September, Shell said it will layoff up to nine thousand workers by the end of 2022.

Shell performed slightly downbeat in the stock market last year with an annual decline of roughly 4%. At the time of writing, the British-Dutch multinational oil and gas company is valued at £84 billion and has a price to earnings ratio of 6.63.