Shell abandons oil sands project in Canada, takes $2bn charge –

Shell abandons oil sands project in Canada, takes $2bn charge –

by ahnationtalk on October 29, 2015309 Views

October 28, 2015

Royal Dutch Shell (LON:RDSA) (NYSE: RDS.A, RDS.B)has pulled the plug on the development of its Carmon Creek thermal oil sands project in Canada and expects to take a $2 billion charge as a result of the decision, which was partly a result of a shortage of pipeline capacity in the region.

The move, said the company, comes after a review of the project’s design and costs and where it stacks up against other projects Shell has in its portfolio.

“We are making changes to Shell’s portfolio mix by reviewing our longer-term upstream options world-wide, and managing affordability and exposure in the current world of lower oil prices. This is forcing tough choices at Shell,” the company’s CEO Ben van Beurden said in a statement.

The decision reverses a March announcement, in which the European energy giant warned it would slow down the development of Carmon Creek, an 80,000 barrel-per-day project, as a consequence of low oil prices.

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