While reduced demand and low prices remain a problem in the oil industry, Shell has confirmed that the Cambo discovery to the west of Shetland is still an important part of its portfolio, despite deferring a decision to develop it until next year.

The Anglo-Dutch oil major recently cut its first-quarter dividend for the first time in its long history. Ben van Beurden, Shell’s CEO, said the 65% cut would help the company to weather the effects of low oil prices, which may persist for some time, while still investing in future growth. While Shell is not entirely dependent on upstream oil operations, the demand for products like slideway oil is also likely to be hit, as many manufacturers scale back or close operations in response to lower demand.

Shetland is the northernmost part of the UK, and the Cambo field is believed to be one of the largest undeveloped discoveries on the United Kingdom Continental Shelf, with it being estimated at 800 million barrels of oil. Jessica Uhl, the chief financial officer at Shell, hinted that the field may well be developed once market conditions are more favourable:

“That was a project we supported at the end of last year, early this year, which is an indication in a very competitive environment for capital allocation we’re still directing capital towards the North Sea.”

Shell is reducing its investment in new assets by $5bn this year, as well as aiming to achieve a $4bn cut in its annual running costs.