Shell Share Discussion Threads

[florenceorbis] 06/2/2020 08:19

Talks break down in Coastal GasLink pipeline standoff
Feb. 5, 2020 5:55 PM ET|About: TC Energy Corporation (TRP)|By: Carl Surran, SA News Editor

British Columbia's provincial government and First Nations chiefs say talks failed to reach agreement on a peaceful resolution over the enforcement of an injunction allowing construction of the Coastal GasLink pipeline through traditional territory.

The Wet'suwet'en hereditary chief says his side remains committed to the engagement process and will continue discussions with the B.C. government.

The B.C. Supreme Court granted Coastal GasLink an expanded injunction on Dec. 31, and Wet'suwet'en hereditary chiefs responded by issuing the company an eviction notice.

The planned $6B Coastal GasLink pipeline, majority owned by TC Energy (NYSE:TRP), would move gas from northeast B.C. to the Pacific Coast, where the Royal Dutch Shell-led (RDS.A, RDS.B) LNG Canada export facility is under construction.

[crossing_the_rubicon] 06/2/2020 08:04

"hellscream6 Feb '20 - 06:17 - 9458 of 9460
government hasnt even got the money to repair potholes on our roads"


But Govt can find £15bn for foreign aid for countries with their own space programmes and standing armies far larger than our own measly 80,000 odd!

[waldron] 06/2/2020 07:42

Europe Markets
Europe markets set for higher open as investors await earnings; virus fears abate
Published Thu, Feb 6 202012:41 AM EST
Holly Ellyatt
@HollyEllyatt



Key Points

European markets are expected to open higher on Thursday as earnings dominate investor focus and fears over the coronavirus outbreak start to fade.
London’s FTSE is seen 37 points higher at 7,519, Germany’s DAX higher by 72 points at 13,549 and the French CAC up 26 points at 6,018, according to IG.

[hellscream] 06/2/2020 06:17

government hasnt even got the money to repair potholes on our roads. one big recession and all this green talk will end, government is blowing future pensions with pension freedoms as it is. propping up housing with taxpayers cash and borrowing.

[essentialinvestor] 05/2/2020 23:19

There will need to be extraordinary investment in UK EV charging.

Guildford which is a few miles from me now runs a fleet of electric busses.

[kkclimber56] 05/2/2020 22:46

IainFirst there needs to be a vision, then a target and then a plan.Boris is somewhere between the first and second of these.Assuming the climate science is correct then it's not a matter of if but when this change has to be made.Perhaps a parallel can be made with Kennedy's " we will put man on the moon by the end of the decade" speech. I dont think there was any plan when he made that speech.

[xxxxxy] 05/2/2020 20:41

Iain MoorePosted February 5, 2020 at 9:40 am | PermalinkOur politicians, rather than being embarrassed about their advice on diesel cars, seem to have taken it as licence to an even more extreme intervention in our lives with Boris banning diesel, petrol and hybrid cars by 2035.We rack up some 327 billion miles of driving a year. An economy electric car does 3.6 miles per kilowatt , meaning we will require an awful lot of addition generating capacity. Its taking us 10 years and £22 billion to build two 1.6GWh reactors at Hinkley C. So where in the statement yesterday was Boris's plans to build 20 (I think) additional Hinkley Cs and I presume Chancellor Javid is going to set aside some £400 billion in his next budget to build them, or as our political class is besotted with Greta Thunberg may be they think she will step off her carbon fiber yacht and turn pebbles into Lithium batteries , and have electricity flowing like milk and honey.

[waldron] 05/2/2020 17:15

Brent Crude Oil NYMEX 55.98 +3.74%
Gasoline NYMEX 1.68 +3.95%
Natural Gas NYMEX 1.88 -1.10%
WTI 51.5 USD +3.87%


FTSE 100
7,482.48 +0.57%
Dow Jones
29,088.63 +0.98%
CAC 40
5,985.4 +0.85%
SBF 120
4,729.27 +0.90%
Euro STOXX 50
3,778.84 +1.32%
DAX
13,478.33 +1.48%
Ftse Mib
24,237.92 +1.65%


Eni
13.028 +1.88%


Total
45.435 +1.42%

Engie
15.535 -0.70%


Bp
484.3 +2.70%

Vodafone
146.98 -2.82%

Royal Dutch Shell A
2,024.5 +1.46%

Royal Dutch Shell B
2,015.5 +0.88%

[xxxxxy] 05/2/2020 17:04

Spent batteries. Pollution. Just saying.

[xxxxxy] 05/2/2020 17:00

Martin CPosted February 5, 2020 at 1:44 pm | PermalinkI understand the UN's next climate report in 2022 is going take into account solar forcing of the climate for the very first time. Perhaps it would be sensible consult them and put off irrevocable decisions until then?Man-made carbon dioxide is not the cause of climate change; indeed, carbon dioxide is essential for all life on earth. Instead, look to the solar minimum, the weakening magnetosphere, increases in solar radiation (including UVC), the effects of the reversal of the magnetic poles, increased cloud cover caused by increased cosmic rays, and the Galactic sheet currently believed to be passing through our solar system.Disruptions in star systems nearest to us, aligned towards the centre of the galaxy, have been observed over the last 20 years or so, and it just happens that the sun is next on the list. Now, I understand there is also unexpected climate change on Venus, Saturn and Jupiter, with Mars experiencing an increase in Mars-quakes. We're not responsible for that! See the bigger picture before you bankrupt the nation and drive is back into the stone age.

[xxxxxy] 05/2/2020 16:52

UK scientists make 'significant breakthrough' in race for coronavirus vaccine Daily Telegraph

[poikka] 05/2/2020 16:38

To add to 448, assuming that Shell's not alone in finding replacement harder to come by, then the OP should make up for lower production - at least.

[markth] 05/2/2020 16:32

Lots of "strong buy" recs on the go for Shell. Took a modest plunge. Its same price as it was three years ago.

[waldron] 05/2/2020 14:16

Royal Dutch Shell: No Need To Worry Over Proven Reserve Life And Dividend Remains Safe Despite Soft Fourth Quarter Results
Feb. 5, 2020 8:57 AM ET |
About: Royal Dutch Shell plc (RDS.A), RDS.B
Daniel Thurecht
Daniel Thurecht
Long-term horizon, contrarian, oil & gas, industrials
(2,246 followers)
Summary

Unfortunately for shareholders in Royal Dutch Shell, results for the fourth quarter of 2019 were quite soft and thus saw their share price sink near 5% at one point.

Although their shrinking reserve life is not an ideal situation, there are two main reasons why this is not as concerning as it may initially appear.

Management is taking sensible actions with their capital allocation through keep capital expenditure low and slowing their share buybacks.

These steps should help ensure their cherished dividend payments continue well into the future, although their prospects for future dividend growth is minimal at the moment.
Introduction

Recently the European oil and gas giant, Royal Dutch Shell (RDS.A) (RDS.B), reported results for the fourth quarter of 2019. Unfortunately for shareholders these results saw net income fall 83% year on year and thus were not received particularly well by the market, sending the share price down nearly 5% at one point. This article provides my commentary on several key topics and the outlook for shareholder returns.
Reserve Life

One concerning aspect that has been mentioned was their sixth consecutive decline in their proven oil and gas reserve life, which now stands at only approximately eight years. Whilst this is certainly not an ideal situation, there are a couple of reasons why it is not as alarming as stating that their “…status quo on reserves would put it out of business in eight years” indicates.

The first reason being that this assumes a zero reserve replacement ratio, which history indicates is very unlikely to eventuate. During the last three years their reserve replacement ratio has on average been 48% or 90% if the impacts of acquisitions and divestitures are excluded. If an investor assumes the lower reserve replacement ratio of 48% will continue going forward, this indicates that their reserves would actually last approximately twice as long. Naturally the thought of their reserves actually lasting sixteen years does not sound nearly as alarming and thus indicates they have considerably more time to address this issue. Whilst their future reserve replacement ratio may differ, considering this occurred during a period of industry wide reduced exploration expenditure and was heavily impacted by divestitures, it seems realistic to assume that this could continue at least in the medium-term.

Personally I believe their reserve replacement ratio that excludes the impacts of acquisitions and divestitures is a more suitable way to view their performance as inorganic decisions such as these can work in either direction, which leads into the second reason. Providing they maintain a strong financial position and thus access to capital markets they should be able to acquire reserves in the future as necessary or alternatively further diversify their earnings into other areas, such as renewable energy.
Cash Flows, Capital Expenditure Guidance & Dividend Coverage

Although the headline figures indicating that their operating cash flow decreased from $22.021b in the fourth quarter of 2018 to only $10.267b for the equivalent time period of 2019 sounds dramatic on the surface, the underlying situation was not nearly as severe. If the impacts of working capital changes are removed from both results, their operating cash flow only decreased slightly from $12.9b to $12.3b.

Considering the pressure they are currently facing from not only weak oil and gas prices but also downstream margins, it was reassuring to see capital expenditure guidance towards the lower end of their $24b to $29b range. This is a positive indicator for their capital allocation as it should strike an appropriate balance between ensuring their financial position remains healthy without underinvesting in their future.

Their dividend coverage for the fourth quarter of 2019 was not particularly strong with their operating cash flow of $10.267b only leaving $2.307b for dividends after paying for capital expenditure, investments in joint ventures and associates, net interest expense and dividends to non-controlling interests. This only provided dividend coverage of 61.93% as their dividend payments of $3.725b left a shortfall of $1.418b, however, due to divestitures totaling $2.081b this shortfall was not funded through debt. Whilst this quarter was not stellar, I still maintain that their dividend remains safe as was further discussed in one of my previous articles. Nevertheless their share buybacks totaling $2.848b where clearly partly funded through debt, which as subsequently discussed are being reduced in the short-term.
Future Buyback Outlook

The next tranche of their share buybacks to is be completed by the 27th April 2020 and will not exceed $1b, which is significantly less than the $2.848b that were repurchased during the fourth quarter of 2019. When considering the current macroeconomic backdrop it should come as little surprise that they are slowing the pace of their share buybacks. This indicates that management is making sensible capital allocation decisions that should help ensure their financial position remains secure and thus their cherished dividend payments continue flowing even if times get tougher.
Future Dividend Outlook

Given the current gloomy situation for their underlying commodities as well as their desire to further deleverage and complete their share buyback program, it seems safe to assume that their dividend will be remaining static for a while longer. Considering their dividend yield sits at virtually 7% as of the time of writing, this is not necessarily problematic as going forward shareholders can theoretically still earn a modest return in this low interest rate world even if their share price only trends sideways.
Conclusion

The softness of their earnings should have been mostly expected given the underlying industry conditions that they unfortunately have zero control over. Thankfully it appears that their management is making sensible capital allocation decisions to ensure their core business and cherished dividend payments continue well into the future. Although as a shareholder I would naturally prefer to see stronger results, volatility is par for the course in this industry and thus nothing contained within these results causes me to alter my bullish rating.

Notes: Unless specified otherwise, all figures in this article were taken from Royal Dutch Shell’s Fourth Quarter 2019 report, all calculated figures were performed by the author.

[waldron] 05/2/2020 11:27

Investomania

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FTSE 100 (INDEXFTSE: UKX)
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Why I’m optimistic about FTSE 100 shares SSE, Shell and Rio Tinto
I think these 3 FTSE 100 (INDEXFTSE:UKX) shares could deliver improving returns: SSE PLC (LON:SSE) (SSE.L), Royal Dutch Shell Plc (LON:RDSB) (RDSB.L) and Rio Tinto plc (LON:RIO) (RIO.L)
February 5, 2020 Robert Stephens, CFA FTSE 100 (INDEXFTSE: UKX), Rio Tinto (LON:RIO), Shell (LON: RDSB) (RDSB.L) (RDSB.LON), SSE (LON: SSE) (SSE.L) (SSE.LON)
SSE PLC
SSE PLC

FTSE 100 stocks SSE PLC (LON:SSE) (SSE.L), Royal Dutch Shell Plc (LON:RDSB) (RDSB.L) and Rio Tinto plc (LON:RIO) (RIO.L) could offer long-term growth potential in my view.

I’m not normally optimistic about utility stocks owing to their slow pace of growth, but I think SSE could deliver an improving financial performance. Its switch towards renewables could help it to transition to what is likely to become an increasingly ‘green’ UK economy in my view.

SSE’s share price has risen over the past few months. It gained on the general election victory and without the threat of nationalisation, I feel that investor sentiment may improve. Global economic risks could make utility shares more attractive to investors, and may help to increase demand for SSE stock over future months.

Shell has struggled alongside many of its sector peers with low gas prices. They are showing little sign of mounting a strong recovery to my mind, so I’m expecting further challenges for the business in the short run.

Still, Shell has a solid growth strategy to my mind. It is reducing the debt on its balance sheet, which could cause its overall risk to fall. It is also aiming to improve its free cash flow, which may help to sustain dividend growth in the long run to my mind.

Rio Tinto also faces uncertain operating conditions. A potential slowdown in China, which is the biggest iron ore market in the world, could hurt the company’s progress and expose what I consider to be its major weakness. This is its lack of diversification, since the company is still heavily reliant on iron ore for its sales.

Rio Tinto has been able to strengthen its balance sheet over the past few years, and I think this could help it to overcome potential risks facing the global economy. Its P/E ratio of around 10 suggests to me that it may offer good value for money at the moment.
About Robert Stephens, CFA 6256 Articles
Robert Stephens is an Equity Analyst who runs his own research company. He is a CFA Charterholder and a passionate private investor who has been buying and selling shares for many years. He currently writes for The Telegraph's Questor column, What Investment, Master Investor, Investomania and Gurufocus. To contact Robert, please email [e-mail] or connect via Twitter

[smith99] 05/2/2020 09:48

I can't help feeling that all of this is poin tless until the likes of china and India get on board or until then other countries force a green import tax on the big polluters

[florenceorbis] 05/2/2020 07:11

DIVIDEND COVERAGE STATED AS 0.96

[sarkasm] 05/2/2020 05:11

DIVI DATES



Announcement date January 30, 2020

Ex-dividend date February 13, 2020

Record date February 14, 2020

Closing of currency election date (see Note below) February 28, 2020

Pounds sterling and euro equivalents announcement date March 9, 2020

Payment date March 23, 2020