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Shell Provides Q2 Guidance: Warns of Up to $2B Hit

Shell plc (NYSE: SHEL) expects a $2 billion impairment in the second quarter of 2024 after pausing its Rotterdam biofuels facility and divesting its Singapore refinery. Rotterdam's construction halt leads to a $600 million to $1 billion non-cash charge, while Singapore sees $600 million to $800 million in charges. Now, let's dig into some other segment-wise selected items from the London-based supermajor's release on Friday. Upstream According to the latest update, Shell's upstream production fell 5.4% on a sequential basis in the second quarter of 2024 at the midpoint of the guidance. The supermajor is estimating its output in the range of 1,720-1,820 (thousand barrels of oil equivalent per day) MBOE/d compared to 1,872 MBOE/d in the first quarter of 2024. Tax charges are expected to hurt earnings in the range of $1.8-$2.6 billion. Meanwhile, Shell expects the share of profit of joint ventures and associates to be around $200 million. The segment's results are also likely to include well write-offs to the tune of $200 million. Finally, operating expense for the segment is projected at around $2.4 billion. Integrated Gas Shell's LNG liquefaction volumes are expected in the range of 6.8-7.2 million tons, translating into a decrease of around 7.7% sequentialy. Shell's ...