Anger as Shell to hand billions to its shareholders
Oil and gas group Shell’s profits plummeted to just over $5bn (£3.9bn) but the firm sparked outrage when it said it planned to give back billions to shareholders rather than invest in clean energy.
Climate groups criticised the decision along with its plans to invest more in oil and gas production at a time when record-breaking temperatures were creating chaos around the globe.
Shell’s quarterly profits to the end of June were more than 50 per cent down on the $11.5bn it achieved in the same period last year. The drop was largely due to oil and gas prices falling from a peak following Russia’s invasion of Ukraine.
The biggest decline in Shell’s profits came in its gas division which almost halved to $2.5bn, from $4.9bn as seasonal factors – people use less heating in the summer in the first quarter of the year – and the fact reserves in the UK and Europe in readiness for winter are high.
Shell increased its dividend and said it would buy back $3bn worth of shares over the next three months and at least $2.5bn after that.
Shell’s new investment in oil and gas this year is forecast to hit £11.3bn, up 10 per cent on last year. Further investments are earmarked for 2024.
Greenpeace and other environmental groups said that Shell and other oil firms should be made to pay for the climate crisis and other damage they have caused by paying into the Cop27 loss and damage fund.
Maja Darlington, at Greenpeace UK, said: “While millions attempt to rebuild their lives after months of extreme weather wreaked havoc from Rhodes to Rajasthan, Shell is upping oil and gas production, slashing investment in renewables and posting billions in profits.”
“It is blazingly clear that global leadership is needed to end this fossil fuel free-for-all, but instead the UK Government is flip-flopping on its climate commitments and further enriching the oil giants with new fossil fuel developments,” she said.
“It’s time for the Government to find its backbone and force Shell and the rest of the industry to stop drilling and start paying for the damage they are already causing around the world.”
George Dibb, at the Institute for Public Policy Research think-tank, said that Shell continued to put its profits and shareholders “over our planet”.
Mr Dibb added: “It continues to make huge amounts of money off the back of the war in Ukraine and high energy prices.
“Incredibly, Shell is now paying more out to its shareholders in dividends and buybacks than it makes in profit, clearly prioritising these transfers over investing in a net-zero future”.
Wael Sawan, Shell’s chief executive, insisted that the company would continue to invest in clean energy projects.
He said it was searching for partners to help “unlock the renewable generation to access green electrons that feed into that integrated power value chain that we think we can actually create value out of”.
Mr Sawan added: “The transition is going to require unprecedented partnerships to take place.”
