The Netherlands-based energy major Shell will shed 1,000 more jobs this year in a bid to reduce its massive costs.
Much of this will come from downstream and ongoing cost initiatives in the corporate functions, Shell CEO Peter Voser states.
While the company tries to reduce its costs by $1 billion (730 million) Q4 2009 earnings for the group came up to $1.2 billion compared to $4.8 billion for the same period in 2008.
Profits from its upstream activities slumped from $4.7 billion in Q4 2008 to $2.5 billion in Q4 2009, earnings for its downstream operations were hit hard over the corresponding period.
It suffered a $1.8 billion loss from its downstream activities during Q4 2009, compared to profits of $561 million in Q4 2008.
Downstream is facing some tough times. There is a significant overhang of industry refining capacity, exacerbated by the economic downturn. Thats why we have initiatives underway to refocus Shells downstream footprint into fewer, more profitable markets with growth potential, through disposals and selective growth investment, Voser adds.
The group has reduced underlying operating costs by some $1 billion in Q4 2009, and by over $2 billion in 2009 compared to 2008.
We are not assuming that there will be a quick recovery, and the outlook for 2010 is uncertain, Voser concludes.