Shell announced the completion of its planned $8.5 billion half-year share buyback programme, ahead of its second quarter results at the end of July.
In a 7 July trading update the supermajor pointed to steady results from its integrated gas business, from which production is expected to be between 930,000-980,000 barrels of oil equivalent per day (boepd).
Overall LNG liquefaction volumes are expected to dip following the “derecognition” of output from the Sakhalin plant, to between 7.4 and 8 million tonnes.
Shell announced a $3.9 billion (£3.1bn) impairment last quarter owing to its decision to pull out of Russian ventures in the wake of the country’s invasion of Ukraine.
It said the loss of volumes from Sakhalin was expected to have a negative impact of $300-350m this quarter.
Trading and optimisation results for integrated gas are also expected to be lower compared with the first quarter 2022, which had “exceptional trading optimisation opportunities.”
The upstream oil segement is expected to report quarterly production of between 1.85 and 1.95 million barrels of oil equivalent per day (boepd), reflecting higher scheduled maintenance.
A more complex picture emerged for its chemicals and products unit.
Indicative refining margins have soared and are now expected in the range of $28.04 per barrel for Q2 2022 – nearly triple the $10.23 per barrel of Q1 and almost seven times the $4.17 per barrel for the same quarter last year.
Shell said it expects the increased margin to generate between $800m and $1.2bn in its Q2 results for the unit, compared with Q1.
However, its indicative chemicals margin is $86/tonne, compared to the $98/tonne in the first quarter 2022, leading to an expected loss for chemicals in the second quarter.
It expects to pay a combined between $3.3 and $3.7 billion in tax across the business for the quarter.
It also expects to see post-tax impairment reversals in the range of $3.5-4.5 billion from previously impaired assets, which it said were due to changes in commodity prices.
The results will follow a record Q1 for the company, in which rocketing energy prices pushed the group’s pre-tax profits to $10.8bn (£8.6bn).
In a note Panmure Gordon director and research analyst for oil and gas, Ashley Kelty, said overall results would be down slightly on the first quarter as a result of “maintenance periods and softer gas prices with tax charges significantly higher than same period last year,” but added that investors “should expect another bumper quarter” when full results are published at the end of the month.