Shell's Bold Play- Prelude LNG Revamp Trimmed To Meet Winter Demand Surge: Report

Shell PLC SHEL reportedly considered temporarily halting operations at its flagship floating LNG production platform Prelude offshore Australia to cater to some maintenance works and repairs. 

Prelude - the world's largest floating liquefied natural gas facility offshore Australia, has suffered a string of outages since it started production in June 2019, Reuters reported, citing three industry sources familiar with the matter.

The maintenance schedule, which started this month, will last two months. Shell ditched its extended one-year plan for maintenance works and opted for the shorter two-month program to capture strong industry gas demand, Reuters added. 

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The decision will allow the plant to gain from the winter demand in the northern hemisphere, including China and Europe.

However, as Shell opted for a "quick fix," the 3.6-million-ton-per-year LNG plant could continue encountering operational issues, the report added.

On May 12, the company stopped production at its Prelude floating LNG facility due to problems with its processes, according to a Reuters report.

During its Q2 results, Shell said that total oil and gas production increased by 6% Y/Y in the first half of the year due to lower maintenance in Pearl GTL, Prelude, Trinidad and Tobago. 

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Price Action: SHEL shares are trading lower by 0.44% to $63.11 premarket on the last check Thursday.