16 March 2010 10:35 [Source: ICIS news]
SINGAPORE (ICIS news)--Shell will cut 2,000 jobs by the end of next year and plans to sell $1-3bn worth of assets in a bid to boost profits, the oil giant said on Tuesday.
Downstream, the company aims to boost profitability in its operations by exiting 15% of its current refining capacity worldwide and 35% of its retail markets, it said in a strategy update.
Earnings from Shell’s downstream operations had shrunk to $258m (€188m) from $5.31bn for the whole of 2009.
Of the 2,000 job cuts, 1,000 were announced last month when the company released its full-year and fourth-quarter results.
Shell would be making substantial investments in new refining and petrochemicals capacity in the next 10 years, said CEO Peter Voser.
“Once these projects are on stream, I expect the downstream growth emphasis will switch to further strengthening our marketing for the next several years,” Voser said.
“The priorities are for a more competitive performance, for growth, and for sharper delivery of strategy. We have more to do to drive out cost and improve the operating performance in the company,” he added.
Shell's downstream unit was also adding new chemicals capacity in
Meanwhile, Shell’s upstream production of oil was expected reach 3.5m barrels of oil equivalent per day in 2012, an increase of 11% from 2009, the company said.
“Near-term pressures on downstream and gas margins remain. However, the medium-term upstream fundamentals are robust, we expect oil to trade typically in a $50-$90 range, and to trend to the upside,” said Voser.
($1 = €0.73)
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