Shell writes off entire investment in troubled gas venture NAM


Shell has written off its entire $244m investment in gas production company NAM in a move seen as a further attempt to distance itself from the troubled company.

NAM is a 50-50 joint venture between Shell and ExxonMobil and faces huge damages claims because of the earthquakes in Groningen province which have been caused by the extraction of natural gas.

The one-off charge was booked in first-quarter earnings published on Thursday, according to the Financieele Dagblad.

The Dutch government plans to shut off production of gas from the northern Groningen field by 2030 and pull back production sharply before that. The cost of shoring up houses hit by subsidence is put at between €1bn and €30bn and is to be shared by the state and the oil companies.

In addition, some €50bn to €125bn worth of gas will remain underground. And documents from 2016 show the oil companies may make a claim against the Dutch state for lost income.

Shell booked first-quarter net profit 43% higher at $5.3bn, far above analysts expectations. The earnings increase was ascribed to higher gas and oil prices.

Operational cash flow was virtually unchanged at $9.4bn. The Anglo-Dutch company, sixth largest in the world, is proposing to maintain its $0.47 per share dividend.

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