Houston: Owing to the weak global economy, Royal
Dutch Shell reported on Thursday a sharp drop in third-quarter
earnings and production and said it would cut 5,000 jobs.
The 5,000 jobs would be cut from the Anglo-Dutch oil and
gas group as part of a restructuring that began earlier this
year.
The job losses are part of a programme called Transition
2009, which was put in place by Peter Voser, who started as
chief executive in July. The cutbacks represent some 4.9 percent of the corporation's 102,000-member staff, and almost 10
percent in those divisions Shell is merging.
Voser said the corporation had to take "stringent
measures to further improve our performance" and its
"competitive cost position".
Although the corporation had "some indications that
energy demand and pricing are improving," he said, "the
outlook remains very uncertain, and we are not expecting a
quick recovery.
"Voser said the reorganisation, due to be completed by
the end of the year was "progressing well" and had already
reduced operating costs by 1 billion pounds (0.676 billion
euros) in the first nine months of this year.
The energy giant said production in the third quarter
amounted to 2.93 million barrels a day, lower than the 3.39
million barrels analysts had counted on.
Shell's third quarter earnings on a current cost of
supplies (CCS) basis were USD 3 billion (2. 03 billion euros)
compared with USD 10.9 billion during the same period last year.
Voser said Shell's third quarter results "were affected
by the weak global economy."
This was more than the USD 2.62 billion analysts had
predicted. Basic CCS earnings per share decreased by 72 percent versus the like quarter a year ago.
Net profits amounted to USD 3.2 billion, compared with USD 8.5
billion in the like period last year. The decline in oil and
gas prices hit Shell's upstream division, which saw profits
fall 82 percent to USD 1.54bn as oil and gas production fell.
Bureau Report