Shell warns of £1bn hit in fourth quarter from emissions certificates payments
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Shell has braced itself for a $1.3bn (£1.04bn) cash blow in the last quarter due to the cost of emissions certificates, the energy titan announced on Wednesday. The charge is "related to timing of payments of emissions certificates" in Germany and the US, it explained. Moreover, the London-listed giant forewarns that profits in its gas business are set to fall"significantly lower" in Q4 following a decrease in liquefied natural gas (LNG) output.
The firm predicts its LNG production fell to between 6.8 and 7.2 million tonnes from 7.5 million tonnes in Q3, as per a recent trading update. This dip was caused by "lower feedgas" availability and fewer shipments of the commodity compared to last period, Shell added.
As the world's leading LNG trader—a pivotal part of global energy mixes—the dip is significant. Elsewhere, Shell’s oil refining margins held steady at around $5.5 (£4.41) per barrel despite last year's slump. Shell and other oil refiners faced reduced demand throughout 2020, impacted by both the rise of electric vehicles and economic contractions in key markets such as China.
