* Q3 adj. earnings of $4.1 bln below analysts' forecast
* $7 bln Permian shareholder payouts to start next year
* New climate target is absolute, not intensity-based
(Adds graphic, detail on earnings, production volumes, outlook)
By Shadia Nasralla
LONDON, Oct 28 (Reuters) - Royal Dutch Shell set
itself tougher emissions cutting targets on Thursday, even as it
reported a lower-than-expected third-quarter profit of $4.13
billion.
The oil major said it would cut absolute emissions from its
operations and the electricity it uses, known as Scope 1 and 2
emissions, by half by 2030 compared with 2016.
The company has pledged to become a net-zero emissions
company by 2050, but has come under pressure to make faster
progress, with a Dutch court ordering it in May to cut all of
its emissions - including from the combustion of its products by
customers, or Scope 3 - by 45% by 2030.
Shell is appealing the court ruling.
The company previously set a target to cut the carbon
intensity of its products, meaning emissions by unit of energy
produced rather than in absolute terms, by at least 6% by 2023,
20% by 2030, 45% by 2035 and 100% by 2050, compared to 2016
levels.
HURRICANE HIT
As previously flagged, Shell will distribute $7 billion to
its shareholders from next year after a $9.5 billion deal to
sell its U.S. Permian assets to ConocoPhillips closes.
Its third-quarter adjusted earnings came in below an average
analyst forecast provided by the company for a $5.31 billion
profit. Earnings were $5.53 billion in the previous quarter and
$955 million a year ago.
Shell had previously flagged a $400 million hit to
third-quarter earnings from the damage caused by August's
Hurricane Ida in the United States and a boost to cash flows
from soaring natural gas and electricity prices.
Gas and power prices surged this autumn as tight gas
supplies have collided with strong demand in economies
recovering from the COVID-19 pandemic. <LNG-AS>
Shell's oil and gas production dropped in the third quarter
to 2.08 million barrels of oil equivalent per day (boepd) as a
result of the COVID-19 pandemic and hurricanes that forced
offshore platforms to shut down.
Oil production fell 4% from the second quarter to 1.49
million barrels per day, while gas output declined 17% to 3.39
million cubic feet per day.
The company guided for its liquefied natural gas (LNG)
production to rise to 8-8.6 million tonnes in the fourth
quarter.
Shell plans to invest around $20 billion this year, compared
with previous guidance for spending to stay below $22 billion.
(Reporting by Shadia Nasralla Editing by Jason Neely and Mark
Potter)
