Shell expects refining margins to be positive

Shell Refining Co. (Federation of Malaya) Bhd is optimistic in recording positive refining margins during the remaining part of 2008. Shell Refining, however, expects high crude oil prices and prevailing market volatility to have an impact on its refining margins to a certain extent during the second quarter, due to the stock accounting practices adopted by the company. During the first quarter, the company recorded a lower net profit of 122.55 million ringgit (US$37.47 million) than the same period a year ago at 137.36 million ringgit (US$42 million). Revenues, however, went up by 56.5% to 3.43 billion ringgit (US$1.05 billion) in the first quarter compared to a year agos 2.19 billion ringgit (US$670 million). Lower profits this year were attributed to lower refining margins and stockholding gains. Shell Refining is presently undertaking measures to maintain profitability. The company is also keeping operation costs as low as possible. (May 16, 2008)