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05.06.2019

Shell to boost spending and dividend

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Despite an uncertain outlook for oil and gas prices, Royal Dutch Shell outlined plans to increase spending and dividends after 2020.

Anglo-Dutch oil major to return $125 billion from 2021 to 2025

Stocks impacted: Royal Dutch Shell (RDSa)

In a strategy update, the company said it was on track to deliver its previous commitments to increase cash generation and carry out one of the world's largest share buyback programs of $25 billion by the end of next year. Shell said its free cash flow is set to rise to around $35 billion per year by 2025 at a Brent crude oil price of $60 per barrel. That compares with $28-33 billion in free cash flow it expects to deliver by the end of next year. It expects to increase its dividend payouts to shareholders once it completes a $25 billion share buyback by the end of 2020 it had promised following the BG acquisition. Shell didn’t break out how much of the $125 billion in distributions would come from higher dividends. That figure compares to $52 billion in payouts from 2011 to 2015, and an expected $90 billion from 2016 to 2020. Shares fell 0.7% initially in London and then trimmed losses to 0.3%.

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