UK-based energy giant Shell has said that it will extend its presence in the upstream sector and grow its gas business.
Shell previously said in 2021 that its oil production had already peaked in 2019, and this decline would continue over the next 30 years as more of its business transitioned towards renewable energy products. Nevertheless, Wael Sawan, the CEO of Shell, told The Times this year that Russia’s invasion of Ukraine and the post-pandemic recovery in demand for energy had exposed the fragile nature of the energy supply system. Earlier this year, BP announced its modified strategy to produce more oil and gas than it previously intended, at least in the short term.
Speaking recently at the company’s Capital Markets Day 2023, Sawan said:
“We are investing to provide the secure energy customers need today and for a long time to come, while transforming Shell to win in a low-carbon future. Performance, discipline, and simplification will be our guiding principles as we allocate capital to enhance shareholder distributions, while enabling the energy transition.”
Despite its focus on developing its integrated gas business, Shell, which also makes industrial lubricants like gear oil and grease, reasserted its commitment to climate-related targets, including becoming a net-zero emitter of greenhouse gasses by 2050.
Shell also announced its intention to raise dividends by 15% from the second quarter this year, as well as buy back some $5 billion in shares later this year if it secures approval from the board.