Shell studies green energy deals to prepare for future after oil

Wed Nov 30, 2016 8:56am EST
 
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By Karolin Schaps and Ron Bousso

LONDON (Reuters) - Royal Dutch Shell, the world's second-biggest publicly listed oil company, is studying acquisitions in the green energy sector, its CEO told Reuters, as it bows to shareholder demands for a strategy beyond fossil fuels.

Shell, which has a market value of $200 billion, produces two percent of the world's oil and gas but rapid technological change coupled with policies to protect the climate have kick-started a shift in energy markets that has put enormous pressure on oil companies to plan for a time after fossil fuels.

"The idea that you can just be a very clever observer and step in when the moment is right, forget about it," Shell Chief Executive Ben van Beurden told Reuters.

"I am convinced that in this space we will play an active role, a leading role and we will plan acquisitions in it."

Major investors, including Dutch pension fund PGGM, have criticised Shell's climate change policies in the past, saying the company should do more to mitigate climate change risks.

"We don't just want them to pay lip service and do it because the industry is under pressure," said Rohan Murphy, co-manager of Allianz' Global Energy Fund, a Shell shareholder.

"Shell do seem to be taking the issue of a less hydrocarbon dependent world seriously and are looking at it properly rather than just talking about becoming greener," Murphy said.

Shell owns about 500 megawatts (MW) of onshore wind power capacity in the United States and has a growing biofuels business in Brazil which produces ethanol from sugar that is mixed with petrol and diesel to reduce carbon dioxide emissions.   Continued...

 
A Shell oil and gas sign is pictured near Nowshera, Pakistan's northwest Khyber-Pakhtunkhwa Province September 8, 2010. REUTERS/Morteza Nikoubazl/File Photo