Royal Dutch Shell still sees abundant opportunity to make money from oil and gas in coming decades even as investors and governments increase pressure on energy companies over climate change, its chief executive said.
But in an interview with Reuters, Ben van Beurden expressed concern that some shareholders could abandon the world’s second-largest listed energy company due partly to what he called the “demonisation” of oil and gas and “unjustified” worries that its business model was unsustainable.
The 61-year-old Dutch executive in recent years became one of the sector’s most prominent voices advocating action over global warming in the wake of the 2015 Paris climate agreement.
Shell, which supplies around 3% of the world’s energy, set out in 2017 a plan to halve the intensity of its greenhouse emissions by the middle of the century, based in large part on building one of the world’s biggest power businesses.
Still, the amount of carbon dioxide emitted from Shell’s operations and the products it sells rose by 2.5% between 2017 and 2018.
A defiant van Beurden rejected a rising chorus from climate activists and parts of the investor community to transform radically the 112-year-old Anglo-Dutch company’s traditional business model.
“Despite what a lot of activists say, it is entirely legitimate to invest in oil and gas because the world demands it,” van Beurden said.
“We have no choice” but to invest in long-life projects, he added.
Shell and its peers have long insisted that switching away from oil and gas to cleaner sources of energy will take decades as demand for transport and plastics continues to grow. Investors have warned, however, that oil companies often rely on forecasts that underestimate the pace of change.
Shell plans to greenlight more than 35 new oil and gas projects by 2025, according to an investor presentation from June.