* Shell cuts 2015 capex by another $3 bln to $30 bln
* Plans $50 bln asset disposals between 2014-2018
* Q2 profit drops 37 percent after oil price slump
* Shares up 4.7 pct, bouncing from year’s low (Recasts, adds quotes, updates shares)
By Ron Bousso and Karolin Schaps
LONDON, July 30 (Reuters) - Royal Dutch Shell is to axe 6,500 jobs this year and step up spending cuts as it seeks to reassure investors it can withstand an extended period of lower oil prices, even through its planned $70 billion acquisition of BG Group.
The Anglo-Dutch company also announced plans to raise $50 billion from asset sales between 2014 and 2018 after its second-quarter profit dropped by 37 percent. (link.reuters.com/ren35w)
“Perhaps we left the impression that we will wait for the cavalry to arrive in the form of higher oil prices and that we were going to be lazy in terms of cost takeout,” Chief Executive Officer Ben van Beurden said on Thursday.
“But what we also said at the time (of the BG deal announcement), perhaps not skilfully enough and not loud enough, is judge us on what we do and that is what today’s message is all about.”
Shell said it anticipated 6,500 staff and direct contractor reductions globally in 2015 from a total of nearly 100,000 employees, as it grapples with a halving in oil prices to around $55 per barrel in a year.
Like rivals BP, Statoil and Total it announced reductions in capital investments for a second time this year, shaving another $3 billion off its 2015 budget to bring it to $30 billion.
Around 20 to 30 percent of the $30 billion of asset sales expected between 2016 and 2018 will come from the downstream and midstream businesses, Shell said, leaving the expanded Shell-BG group to focus on fewer but larger and more competitive assets.
Shell will only make two major investment decisions this year, with many projects scaled back, delayed or cancelled, van Beurden said. He hinted at further spending cuts if economic conditions worsened, including a steeper drop in oil prices.
The company said it was selling a 33 percent stake in the Showa Shell refinery in Japan to Idemitsu for about $1.4 billion.
Shell also reassured wary investors its bumper BG purchase would not break the bank. If the deal goes through in early 2016 as planned, capital investments in 2016 will be $35 billion, Shell said, lower than the $42 to $40 billion analysts expected.
“This should be well received as Shell has suffered from a perception that its capital discipline has been poor relative to peers and that the BG deal was struck assuming higher oil prices, while synergies were limited,” investment bank Tudor, Pickering, Holt & Co said.
Shell is still awaiting regulatory approvals for the deal from the European Union, China and Australia, after Brazil, the United States and South Korea cleared it.
The deal is expected to generate pretax benefits of around $2.5 billion per year starting 2018. The tie-up will turn Shell into the world’s leading liquefied natural gas company and one of the largest deepwater oil producers with a focus on Brazil.
Shell’s second-quarter “cost of supplies” earnings excluding identified items -- the company’s definition of net income -- came in at $3.84 billion, down from $6.13 billion a year earlier and $3.25 billion in the previous quarter. That beat expectations of $3.18 billion, according to an analyst consensus provided by the company.
Shell shares, which fell earlier this week to their lowest this year, were trading up 4.7 percent at 1300 GMT, while the European oil and gas sector was up 2.9 percent.
A sharp decline of around 75 percent in revenue from oil production was once again offset by refining and trading, where earnings more than doubled from a year earlier.
Shell maintained its quarterly dividend at 47 cents per share and committed to rewarding shareholders with at least the same payout in 2016. (Editing by Jane Merriman, David Holmes and Mark Potter)