Europe’s largest oil company, Royal Dutch Shell PLC, posted profits of nearly $7 billion for the third quarter of 2011. The profit increase was attributed to higher prices for oil and one-time gains. The reported profit of $6.98 billion was up from $3.46 billion in the third quarter of 2010. Revenues for the same quarter rose 33% to $127 billion.
Various one time gains, such as the sale of a refinery in Britain, were booked at a net of $245 million. A year ago, the company booked net charges of $1.4 billion, mainly due to impairments on assets resulting from an accounting review of operations in its refining arm and in Canadian heavy oil sands. Healthy margins were cited on the company’s chemical products, refinery margins were unchanged, and intake fell. The results were better than expected and shares rose 1.3% in early Amsterdam trading.
Shell did not announce any financial fallout from the oil spill related to its Gannet Alpha platform located in the North Sea. Chief Executive of the company Peter Voser said in a statement, “Our third quarter results were higher than year-ago levels, driven by higher oil prices and Shell’s performance.” Analyst Richard Hunter of Hargreaves Lansdown Stockbrokers noted that “Whilst ongoing concerns around safety issues and government tax takes persist, these are currently outweighed by the strength of the company’s operating performance.”
Shell reported that its production earnings were $5.44 billion, an increase of 58% excluding one-time gains in both years. Actual production decreased by 1.6 percent to 3.01 million barrels of oil per day and the company disposed of nearly 100,000 barrels worth of production, but added 270,000 barrels of new production at projects in Nigeria, Qatar, and Canada. The company plans to continue investing heavily in new capacity projects and is slated to bring 20 new projects on line by 2014.