Royal Dutch Shell plc is readying for a “new wave” of natural gas and oil production growth to carry it beyond 2012, CFO Simon Henry told financial analysts Wednesday.

The major last year added 350 million boe to its reserves base from Gulf of Mexico (GOM) discoveries alone, he said during a conference call.

“We are looking at options to fast-track the development of these very exciting finds, with over 150,000 boe/d [of] production potential,” Henry said.

Net profit for the first three months of 2010 totaled $5.48 billion, up from $3.49 billion in 1Q2009. Revenue jumped 48% to $88.03 billion from $59.44 billion. The clean cost of supplies, which strips out gains or losses from inventories and nonoperating items, was $4.82 billion, compared with $3.01 billion a year ago. Wall Street had set quarterly expectations for Shell at $3.98 billion.

Total natural gas production was up 12%, which far outstripped the gains in crude output, which rose only 1%. Total production for 1Q2010 was 3.594 million boe/d, an increase of 5.8% from the year-ago period. Analysts had pegged production growth gains to average about 0.2%.

“Our results have improved considerably compared with year-ago levels, and our profitability has increased from the low levels we saw in the fourth quarter 2009,” said CEO Peter Voser. “This has been driven by higher energy prices, operational and production performance and Shell’s growth programs.

“We are making good progress in improving our near-term performance, delivering a new wave of production growth and maturing next-generation project options. Our results reflected the successful ramp-up of our new upstream projects in Russia and Brazil, supporting a 6% increase in our production volumes and a 38% increase in sales volumes in our industry-leading LNG [liquefied natural gas] business.”

LNG sales climbed 38% from 1Q2009 and volumes jumped 32% — the highest volumes ever, said Henry, “reflecting the successful ramp-up in sales volumes from Sakhalin II LNG [in Russia] and improved volumes from Nigeria LNG.”

Shell, which has been restructuring its operations to unload some of its refinery assets and to trim costs, hit its targets “on project delivery, cost reduction and ensuring we get the best revenue from what we sell,” said Henry.

The Anglo-Dutch producer is “working on improving near-term performance, with a new wave of growth into 2012, followed by the next generation of growth for 2013 and beyond,” said the CFO. “We’ve made good progress to reduce our costs by $1 billion in 2010.”

Among Shell’s “successful startups” in the past few months is the Perdido Development, which is in the Lower Tertiary Trend of the GOM (see Daily GPI, April 5).

Considered the world’s deepest offshore drilling and production facility, Perdido, which is the first producing platform in the Lower Tertiary, is able to produce more than 200 MMcf/d of gas and 100,000 b/d of oil.

©Copyright 2010Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.