Royal Dutch Shell is set to stop oil and gas operations in 10 countries in a drive to deepen cost cuts and narrow its focus.
The company’s CEO, Ben van Beurden, disclosed this in London on Tuesday, explaining that the cuts were due to the company’s $54 billion acquisition of BG Group.
He expressed hope that the new cuts would help to boost Shell’s shares, which he said had underperformed rivals since the BG deal was announced in April 2015.
He did not mention the countries that the company plans to exit but there are reports that Shell is planning to sell its assets in Gabon.
Van Beurden said that the company would focus its short-term growth on deepwater projects in Brazil and the Gulf of Mexico.
“Deepwater production could double to some 900,000 barrels of oil equivalent per day in 2020″
“Our strategy should lead to a simpler company, with fundamentally advantaged positions, and fundamentally lower capital intensity.
“Today, we are setting out a transformation of Shell.”
The merger makes Shell the world’s second biggest international oil company behind Exxon Mobil and the top LNG trader.
In the long term, the company said it would target shale oil and gas production in North America and Argentina as well as renewable energies hydrogen, solar and wind.
Shell plans to sell $30 billion worth of assets around the world by 2018 and announce it plans to implement a share buyback programme.