Shell Share Discussion Threads

[muffinhead] 20/1/2016 20:57

Wall Street attempting a supermarket sweep tonight

[zyzzyva] 20/1/2016 20:39

there is something really strange about this deal. i suspect it is about all the payoffs, people with BG options.

they are so desperate to get the deal away, despite the slumping oil price, so they come up with such massive cost savings. In order to meet this target, have to announce 10,000 job cuts to meet the savings, but the acquired company only has 5000 employees!

[zyzzyva] 20/1/2016 20:05

at the closing RDSB price of 1277.5p, on my calcs the deal value is $56bn to acquire $5.5bn of 2015 EBITDA . that is over 10 X EBITDA, covering 2015 when Brent oil averaged $54. Brent oil is now half that.

IMHO DYOR etc

[essentialinvestor] 20/1/2016 19:48

llef, thanks for The FT piece, interesting perspective.


67 posts in a day on Shell, that requires a large degree of engagement at
some level, whatever it is he appears unwilling to declare or share.

[zyzzyva] 20/1/2016 19:47

llef
thanks for posting that. IMO it is a very poor article, going along with managements line. fact is the deepwater assets are high cost and are not profitable at current energy prices. as LNG Shipping & Marketing made $1.2bn EBITDA in the first 9 months, so with $1.4bn for 12 months, it seems it only made $0.2bn EBITDA in Q4. upstream EBITDA is said to be $4.1bn in 12 months, which suggests $1.0bn in Q4. but energy prices have since slumped.

[whiskeyinthejar] 20/1/2016 19:44

Zzz..you didn't answer my question about your motivation for posting.

What gets you up in the morning, keeps you drivelling on all day?

My quick look at your posting history reveals you made 67 posts today on bg and Shell. All rubbish. This isn't normal. Most people are only motivated to pursue things they are good at.

So is it true you work for ukip? Has Nigel got a big short on bg?

Time to own up.

[fangorn2] 20/1/2016 19:39

Zy,

Zyzzyva 20 Jan'16 - 19:14 - 5683 of 5684 0 0

IMO BG is a much bigger mess than shell because its an E&P company basically linked to the oil price and with a lot of high cost deep sea assets. on top of that it has got $10bn of net debt

Linked to OIL price? I thought BG was more exposed to Natural Gas - whats the breakdown of BG business Oil vs Gas?


BG’s overseas assets shine amid oil gloom

[llef] 20/1/2016 19:33

clip from FT article tnight



But for those Shell shareholders disgruntled at the £33bn price the Anglo-Dutch oil group is paying for BG of the UK, some of the detail may cause them to rethink.
Just as Shell missed analysts’ expectations by warning that its fourth-quarter profits would fall at least 40 per cent from a year ago, BG pulled off something special.
After years of disappointment, and under the brief leadership of Helge Lund, BG actually over-delivered on promised output in Australia and Brazil.

The message is clear. Yes, the price of Brent crude has collapsed to less than $30 per barrel, taking the value of gas down with it. But production from BG's liquefied natural gas operations in Australia and its deepwater oilfields in Brazil — the assets that Shell covets — is growing at a clip.

[zyzzyva] 20/1/2016 19:14

IMO BG is a much bigger mess than shell because its an E&P company basically linked to the oil price and with a lot of high cost deep sea assets. on top of that it has got $10bn of net debt. in its Q3 results EBIT slumped 70% and net debts rose by more than $1bn - that was when brent oil averaged $51, it is now half that at $26!

[badtime] 20/1/2016 18:55

EI...rain due here on Friday ..so I hope u get some sun

[zyzzyva] 20/1/2016 18:53

whatever way they spin this, i do not believe it. BG only has 5,000 employees (link at bottom). to say they are cutting 10,000 employees and direct contractors must be porkies. i have seen restructurings before, where the cut costs in one place but add them in another. it has to make you wonder how they came up with the $3.5bn cost savings, which is around 33% of BGs cost base.


hxxp://fuelfix.com/blog/2016/01/20/shell-bg-group-job-cuts-will-rise-to-10000-in-2016-as-earnings-drop/#35602101=0

HOUSTON — The layoffs that Royal Dutch Shell and BG Group began last year will increase by a third to 10,000 employees and direct contractors in 2016, as the firms curb operating costs and try to extract synergies from their impending merger.

hxxp://www.bg-group.com/21/about-us/bg-group-at-a-glance/

[fangorn2] 20/1/2016 18:10

Zy
.all i know is the global economic growth forecasts are being cut back, and there are significant supply issues including iran, with someting like 50m barrels sitting in ships off its coast they apparently want to turn into cash. it will take some time for the market to turn,,

Yes yes, we all know wherre we are today, demand/supply dynamics, but there's every likelihood(as the past has shown) that we will be nowhere near the current situation in 12-18mths let alone 5 years, 10 or 20 years. Which is the basis on which SHELL is budgeting!!!

You also don't identify which assets would be both as tasty(but also, more importantly) likely to be on the market! is it a risk Shell could take if this is the one jewel that comes up for grabs??

As to the Iranian stockpiles Whiskey is spot on

WhiskeyInTheJar 20 Jan'16 - 15:52 - 5656 of 5678 1 0
The Iranian oil in storage is the stuff they couldn't sell under sanctions. Theyve been exporting 1m bopd under sanctions

Condensate and ultra light. It'll sell now I assume, but it won't affect oil price.

But then you knew that, but continued with the scaremongering about 50m barrels in storage nonetheless.

[84stewart] 20/1/2016 18:09

w.s.j
QUOTES shell is a mess and it needs BG to help it finances ,anyone who votes against this deal beware!

[cpap59] 20/1/2016 17:59

I agree pixi. Its one of the most solid ftse 100 companies and eventually oil will find a new level

[pixi] 20/1/2016 17:51

Cpap, I bought twice today, at 1294 and 1271, for a total of £10K. I intend to buy more. Given time, these will get back to where they were and then carry on further north.

[cpap59] 20/1/2016 17:45

yup thats when I inherited the shares!!

[pixi] 20/1/2016 17:39

Back in the summer of 1998 the oil price fell out of the sky and bottomed out at $9 in early 1999. Drilling rigs were mothballed offshore northeast Scotland and the crews laid off. In 2000 they slowly came back to work as prices increased.

[cpap59] 20/1/2016 17:20

Ive been a long term hold of shell B for 15 years plus but have seen like many their holdings plummet in value to new lows.
Would it be best to sell or buy to average down? What will be oils new lower price?

[essentialinvestor] 20/1/2016 16:37

imperial, how did you call this level for crude, industry knowledge?

[imperial3] 20/1/2016 16:36

Pixi.

Tell that to the fund managers.

[imperial3] 20/1/2016 16:35

My portfolio is a sea of red.

[pixi] 20/1/2016 16:33

Anyone with any sense would either pull the deal or hammer the price down.

[imperial3] 20/1/2016 16:32

Some hedge funds must have done brilliantly shorting oil all the way down.

[minerve] 20/1/2016 16:27

Hedge funds were buying put options at $30 a barrel almost a year ago; they have a lot resting on making sure they can offload them.