Shell expected to reduce capex for the year: FT
(Reuters) - Royal Dutch Shell (RDSa.L: Quote), which is all set to acquire rival BG Group Plc BG.L, may cut its capital expenditure for the year by several billion dollars from the previously announced $33 billion figure, the Financial Times reported on Sunday, citing sources.
A substantial cut to this year's capital investment might be outlined during the company's interim results on July 30, the newspaper said.(on.ft.com/1fVVwqU).
The paper said the Anglo-Dutch energy company had also told investors that the BG deal works with crude oil at $70 per barrel, citing much greater synergies which will likely exceed several billions, the business daily said.
The company told investors that "value synergies" are likely to be "a multiple" of $1 billion in annual projected savings from merging head offices and other cost-cutting, the FT said.
Shell, which is betting on crude rising to $90 a barrel by 2020, a key assumption in its move to buy rival BG Group, said it expects oil prices to recover gradually over the next five years.
Shell and BG Group could not be reached immediately for comments outside regular business hours.
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