Shell scraps scrip dividend after three years of austerity

By Ron Bousso

LONDON (Reuters) - Royal Dutch Shell on Tuesday said it will cancel an austerity dividend policy as the oil and gas company boosted its cash generation forecasts, drawing a line under three years of oil price turmoil.

The Anglo-Dutch company said it will abolish its scrip dividend, through which investors can opt to receive dividends in shares or cash, in the fourth quarter of 2017. The scrip dividend scheme was introduced in early 2015 following the sharp drop in oil prices.

In a strategy update, Shell also raised its cash flow outlook from $25 billion to $30 billion by 2020, assuming an oil price of $60 a barrel.

 

"We have also made significant progress with our divestment programme, allowing us to reduce net debt in that time," Chief Executive Officer Ben van Beurden said in a statement.

(Reporting by Ron Bousso, editing by Louise Heavens)