Shell changes approach to mid-century net-zero goal while focusing on oil, gas

Laura Hurst, Bloomberg October 17, 2023

(Bloomberg) – Shell Plc still plans to achieve net zero emissions by the middle of the century, but its approach to hitting that target has changed, its CEO said.

Shell CEO Wael Sawan

“For avoidance of doubt, what hasn’t changed is the destination that we have set for ourselves,” Chief Executive Officer Wael Sawan said via video link at the Energy Intelligence Forum in London on Tuesday. “What has changed is the pathway we’re going to get there.”

Since taking Shell’s helm at the beginning of the year, Sawan has directed a greater proportion of the company’s investment into its core oil and gas business. The change is part of an effort to win over investors with a “ruthless” focus on performance and better returns.

The feedback from shareholders on this strategy has so far been “very, very positive,” Sawan said. They “like the direction we are taking, they like the balance.”

Sawan’s approach has marked a change from his predecessor Ben van Beurden — who was sitting in the audience. Under his leadership, he’s sold off assets in Shell’s low-carbon business and is evaluating the future of different parts of its renewables portfolio.

Shell’s CEO was addressing the conference by video link because climate protesters had blocked the venue’s entrance, preventing access for a number of industry executives. Sawan acknowledged that his strategy shift has also prompted some questions within parts of his own company.

“We’ve had to make some tough choices” that affect “which renewable projects we will pursue and which we will not,” Sawan said. People heavily impacted by some of these choices “feel hurt,” he said. Some employees have asked if the company should be moving faster in the transition to clean energy, he said.

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