Shell Game with Oil – Obama’s Oil Policy Sets Fire to Africa
It is not just the decline in revenue that is crippling most nations. Africa for instance is losing massive investment in the midst of the tumbling value of local currency.
The world’s biggest corporation Royal Dutch Shell in trying to cope with negative effects of falling oil prices closes projects in South Africa. Shell the international oil company, announced it plans to cut spending by $15 billion over the next three years. The company’s management intends to freeze the dividend payment within the program of annual expenditure limit and to cut investments in projects for the shale resources extraction worldwide.
Oil platforms in South Africa will be the first to abolish. Shell was the first major oil company to report earnings for the fourth quarter. According to the data, fourth quarter net income was below forecasts. Analysts and investors expect that the decline in oil prices will continue to exert a strong influence on the major oil companies’.
However, Shell has suffered less compared to its competitors. Nevertheless, the corporation will continue active extraction on Alaska. The company plans to start drilling there this year. In addition, Bonang Mohale, the head of Shell in South Africa, said that they were still trying to get a license to explore for shale gas in the Karoo, a semi-desert region. Shell has been waiting for this license for six years. The US Energy Information Agency suggests that the Karoo has about 390 trillion cubic meters of technically recoverable reserves of shale gas.