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Royal Dutch Shell launches fresh share buyback scheme

Royal Dutch Shell has launched a $1.5billion, or £1.1billion, share buyback as it ramps up cash returns to shareholders via the sale of its Permian business in the US.

The FTSE 100-listed group said the buyback would last until 28 January, adding that it would announce the form and timing for returning a further $5.5billion to investors from the Permian sale, plus any unused funds from the buyback, early next year.  

Shell completed the $9.5billion sale of its Permian Basin operations to ConCoPhilips on 1 December as part of a move away from oil and gas to renewable energy. The company is using the rest of the money to strengthen its balance sheet.

Buyback: Royal Dutch Shell has launched a $1.5bn, or £1.1bn, share buyback as it ramps up cash returns to shareholders via the sale of its Permian business in the US

The oil and gas group is planning to ditch its dual structure and shift its tax residence from the Netherlands to the UK. 

UK business secretary Kwasi Kwarteng hailed the shift a 'clear vote of confidence in the British economy'.

The company claims the shift will 'strengthen Shell's competiveness and accelerate both shareholder distributions and the delivery of its strategy to become a net zero emissions business'.

Shareholders will vote on the changes at a special general meeting on 10 December where the resolution needs to secure a very high threshold of votes – over 75 per cent. 

It has also been dealing with intensifying calls to break up the company from activist fund Third Point.

'A' category Shell shares are currently up 0.44 per cent or 7.00p to 1,614.00p. A year ago the share price was 1,353.80p. 

Oil prices have been under heavy scrutiny over the past few months, amid surging prices at the pumps for consumers. 

Richard Hunter, head of markets at Interactive Investor, said: 'The oil price continued its recent volatile run as investors ran the slide rule over the possibility of dampened demand, especially with regards to travel. 

'A small rebound has settled some nerves, and the movement for the year remains in strongly positive territory with the oil price still ahead by 35 per cent in 2021.'