Royal Dutch Shell plc. will cut down labor force at its Pulau Bukom oil refinery in Singapore by 38%, in light of a redevelopment to reduce CO2 emissions in the next three years. The decision was made owing to a 50% reduction in crude processing capacity.
The Anglo-Dutch energy and petrochemicals major decided to trim its Bukom workforce from 1,300 present-day workers to about 1,100 by 2021, which will be further downscaled to 800 workers by the end of 2023, with the earliest employee turnover at the final quarter of 2021. With global demand and profits stung by the spread of the coronavirus, the payroll cuts will help bolster Shell’s finances.
Per Munirman Abdul Manaf, general secretary of Shell Employees' Union, the affected employees will receive curtailment packages, which include a series of support initiatives, namely extended in-patient medical coverage, professional outplacement services, and a learning subsidy if applicable. Further, Shell will collaborate with external partners to support affected employees for alternative careers.
The Pulau Bukom, the largest wholly-owned refinery of Shell, has a capacity to process 500,000 barrels per day (bpd) of oil. It is an integrated oil and petrochemical site with manufacturing facilities for fuels, lubricant base oils and specialty chemicals. The supermajor plans on limiting its global refining portfolio to six refining and petrochemical units, including the Pulau Bukom manufacturing facility, down from 14, by 2025 under its extensive restructuring plan. The curtailment, however, will cut the total processing capacity to 250,000 bpd, or about a fifth of its worldwide capacity.
On its part, Shell aims to reduce its CO2 emissions through a site-wide digitalization program. It will transform from a crude-oil, fuel-based product slate to a low-carbon production chain. Notably, the oil giant intends to use renewable raw materials or feedstocks, such as recycled chemicals, and is progressing by the production of biofuels and bitumen adaptable to the energy transition to go carbon-neutral by 2050.
Company profile & Price Performance
Shell is one of the primary oil majors — a group of U.S. and Europe-based big energy multinationals — with global operations. The company is fully integrated, as it participates in every aspect related to energy — from oil production to refining and marketing. Its shares have outperformed the industry in the past month. The company’s shares have gained 21.6% compared with the industry’s 14.1% increase.
Zacks Rank & Key Picks
Shell currently carries a Zack Rank #3 (Hold). Some better-ranked players in the energy space are PDC Energy Inc , Sprague Resources LP and DCP Midstream Partners LP , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Over the past 60 days, the Zacks Consensus Estimate for 2020 earnings of PDC Energy has been raised 27.9%, whereas Sprague Resources’ 2020 earnings have been raised 54%.
DCP Midstream is expected to see a stellar earnings growth of 183.4% in 2021.
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Shell (RDS.A) to Cut Jobs & Capacity at Singapore Refinery
Royal Dutch Shell plc. will cut down labor force at its Pulau Bukom oil refinery in Singapore by 38%, in light of a redevelopment to reduce CO2 emissions in the next three years. The decision was made owing to a 50% reduction in crude processing capacity.
The Anglo-Dutch energy and petrochemicals major decided to trim its Bukom workforce from 1,300 present-day workers to about 1,100 by 2021, which will be further downscaled to 800 workers by the end of 2023, with the earliest employee turnover at the final quarter of 2021. With global demand and profits stung by the spread of the coronavirus, the payroll cuts will help bolster Shell’s finances.
Per Munirman Abdul Manaf, general secretary of Shell Employees' Union, the affected employees will receive curtailment packages, which include a series of support initiatives, namely extended in-patient medical coverage, professional outplacement services, and a learning subsidy if applicable. Further, Shell will collaborate with external partners to support affected employees for alternative careers.
The Pulau Bukom, the largest wholly-owned refinery of Shell, has a capacity to process 500,000 barrels per day (bpd) of oil. It is an integrated oil and petrochemical site with manufacturing facilities for fuels, lubricant base oils and specialty chemicals. The supermajor plans on limiting its global refining portfolio to six refining and petrochemical units, including the Pulau Bukom manufacturing facility, down from 14, by 2025 under its extensive restructuring plan. The curtailment, however, will cut the total processing capacity to 250,000 bpd, or about a fifth of its worldwide capacity.
On its part, Shell aims to reduce its CO2 emissions through a site-wide digitalization program. It will transform from a crude-oil, fuel-based product slate to a low-carbon production chain. Notably, the oil giant intends to use renewable raw materials or feedstocks, such as recycled chemicals, and is progressing by the production of biofuels and bitumen adaptable to the energy transition to go carbon-neutral by 2050.
Company profile & Price Performance
Shell is one of the primary oil majors — a group of U.S. and Europe-based big energy multinationals — with global operations. The company is fully integrated, as it participates in every aspect related to energy — from oil production to refining and marketing. Its shares have outperformed the industry in the past month. The company’s shares have gained 21.6% compared with the industry’s 14.1% increase.
Zacks Rank & Key Picks
Shell currently carries a Zack Rank #3 (Hold). Some better-ranked players in the energy space are PDC Energy Inc , Sprague Resources LP and DCP Midstream Partners LP , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Over the past 60 days, the Zacks Consensus Estimate for 2020 earnings of PDC Energy has been raised 27.9%, whereas Sprague Resources’ 2020 earnings have been raised 54%.
DCP Midstream is expected to see a stellar earnings growth of 183.4% in 2021.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.3% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>