Shell says its oil production has peaked and will decline every year

Shell says its oil production has peaked and will decline every year

The Anglo-Dutch company said in A. statement On Thursday, it said it expects its oil production to drop between 1% and 2% every year after peaking in 2019. It added that its total carbon emissions were likely to peak in 2018.
Shell unveiled her plans in September to become a prof Net zero emissions business By 2050 (including their products and those they sell), join European competitors BP (BP) And the sum (Until) In the transition towards clean energy.
He wrote off the oil giants Billions of dollars From assets, driven by predictions that Global demand for oil It may never recover to the levels it reached before the pandemic, amid permanent changes in how people work and travel and growing concerns about the climate crisis.

Shell is now defining how it hopes to achieve this Its goals. It wants to sell more clean energy, while investing in carbon capture and afforestation projects to offset emissions. It will also expand its business in the production and distribution of biofuels.

“Whether our customers are motorists, homeowners or businesses, we will use our global scale and trusted brand to grow in markets where demand for cleaner products and services is stronger, providing more predictable cash flows and yielding higher returns,” said CEO Ben Van Borden. . .

While European oil companies They are trying to reinvent themselves, USA ExxonMobil (XOM) And the Chevron (CVX) They have so far resisted major changes in their business. But the shareholders commotion To change direction and there are indications that pressure may begin to affect.
Michael Wirth, CEO of Chevron For CNN Business This week the company plans to invest in carbon capture, storage and hydrogen. However, Wirth said oil and gas will remain an important part of Chevron’s business for years to come.

This is the case in Shell too, despite announcements on Thursday.

Focus on energy sales

Based on the company’s forecast, Shell’s oil production will decrease By up to 18% by 2030, And 45% By 2050. However, this means that it will still produce more than 1 million barrels of oil per day in 2050. (The company has produced nearly 1.9 million barrels. Of oil per day in 2019).

BP said in August that its oil and gas production would drop 40 percent from 2019 levels by 2030 as its low-carbon investment increased.

Shell said on Thursday that Shell would continue to pump about eight billion dollars annually to explore for and pump oil. It plans to invest between $ 2 billion and $ 3 billion annually in renewable energy sources and hydrogen, with between $ 8 to $ 9 billion toward integrated gas and chemicals.

“Shell will continue to invest more than 80% in oil and gas in the coming years, while investments in renewable energy are lagging far behind,” the Dutch Friends of the Earth group, a climate action group, said in a statement. She added that Shell’s strategy has wrongly focused on offsetting emissions rather than reducing them altogether.

According to Shell, capital spending will shift to clean energy “over time”. The company aims To build a “large-scale low carbon business by early 2030”.

Jessica Ull, CFO, told reporters that Shell will prioritize selling clean electricity to customers rather than investing in renewable energy generation, as competitors like BP have done. “In order to sell these products, you don’t necessarily need to have the generation capacity,” she added.

The company It wants to double its sales of electricity by 2030, and grow its global network of electric vehicles from more than 60,000 charging points today to about 500,000 by 2025. It expects to sell energy to more than 15 million individual and corporate customers around the world.

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Shell said it would give shareholders an advisory vote on its energy transition plan, adding that it was the first company in the sector to do so.

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