Earnings from Shell’s (SHEL.L) liquefied natural gas (LNG) trading operations are likely to have been significantly higher in the fourth quarter of last year despite a sharp output drop owing to plant outages, it said on Friday.
Europe’s largest oil and gas company’s update ahead of its full-year results on Feb. 2 also said it expects to pay about $2 billion in additional 2022 taxes related to the European Union and British windfall taxes imposed on the energy sector.
Fourth-quarter LNG liquefaction volumes are expected to be the lowest since the company acquired BG Group in 2016 for $53 billion, dropping to between 6.6 million and 7 million tonnes as a result of prolonged outages at two major plants in Australia.
But Shell, the world’s top LNG trader, said its LNG trading results are set to be “significantly higher” than in the previous quarter.
Shell shares rose nearly 1% as the market opened.
Shell’s third-quarter results were dented by weaker refining performance and a slump in LNG trading.
The LNG trading division recorded a loss of nearly $1 billion in the third quarter after traders were caught out by a sharp rally in European gas prices when Russia halted supplies.