Shell eyes organic cash flow growth for transforming Downstream business

The Hague-based LNG giant, Shell, is expecting a $6-7 billion annual organic cash flow for its Downstream business by 2020 and $9-$12 billion by 2025. 

The company’s CEO Ben van Beurden said the Downstream business is “fundamental to delivering a world-class investment case.”

Shell’s downstream director, John Abbott, said the business will help the company cope with the energy transition.

Shell ‘s expectations for $6-7 billion annual organic free cash flow from Downstream by 2020, are based on $60 per barrel oil price and mid-cycle Downstream conditions, with $9-12 billion expected by 2025.

Shell noted that chemicals, a growth priority for the company, has been through a transformational phase while the reshaping of refining and trading businesses is nearing completion.

Marketing sector, that represented around 50 percent of Downstream earning in the last five year is expected to generate over $2.5 billion additional earning a year by 2025, while chemicals are expected to bring in $3.5 to $4 billion a year by 2025.

The company plans to invest $7-9 billion a year across the sector and to deliver a return on average capital employed above 15 percent.