Upstream profits exceed expectations at Shell

Integrated oil and gas titan Royal Dutch Shell's upstream activities drove a bigger than expected increase in the Anglo-Dutch group's first quarter earnings.

Underlying earnings on a current cost of supplies (CCS) basis rose to $7,279m from $6,288m in the corresponding quarter of 2011. Charles Stanley analyst Tony Shepard had pencilled in a figure for earnings after tax of $6.5bn.

Earnings from Upstream activities - oil production and the like - rose to $6,253m from $4,638m the year before, while Downstream operations (refining and so on) saw CCS earnings slide to $1,121m from $1,653m the year before. Charles Stanley had predicted Upstream earnings of $5.6bn.

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As previously announced, Shell is paying quarterly dividends of 43 cents this year.

"Shell's first quarter 2012 earnings increased from year-ago levels, through a combination of improved operating performance, increased upstream volumes and strong oil prices," said Chief Executive Officer Peter Voser.

"Energy demand fundamentals are robust, but with near-term

volatility in energy prices as a result of economic and political events. In downstream and North American natural gas we see continued challenges for our industry," Voser added.

More to follow ...

JH