Deals
Shell's BG Risk Starts to Pay as Output Added, Costs Slashed
- Spending in 2016 at level it would have been even without BG
- Much of higher first-quarter production came from BG's assets
Shell Beats Profit Estimates on Boost From Refining
This article is for subscribers only.
Royal Dutch Shell Plc’s record $54 billion acquisition of BG Group Plc is starting to pay off as the assets give it higher production and cash flow, helping it beat analysts’ earnings estimates when it reported quarterly results Wednesday.
While Europe’s biggest oil company benefits from BG’s assets, it’s cutting expenses quickly enough to ensure the takeover isn’t adding any new costs. Shell’s forecasts for capital spending and operating expenses this year are now at the same level they would have been even if it hadn’t bought BG, Chief Financial Officer Simon Henry said. A majority of the 16 percent increase in oil and gas output came from the acquisition.