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Big Oil Looks To Cut Production Following Activist Backlash
By Alex Kimani – Jun 19, 2021, 6:00 PM CDT
Two weeks ago, Big Oil suffered a series of boardroom and courtroom defeats in the hands of hardline climate activists.
…a Dutch court ordered Royal Dutch Shell to cut its greenhouse gas emissions harder and faster than it had previously planned. Never mind the fact that Shell already had pledged to cut GHG emissions by 20% by 2030 and to net-zero by 2050. The court in The Hague determined that wasn’t good enough and has demanded a 45% cut by 2030 compared to 2019 levels.
And now Big Oil is beginning to respond.
CNBC has reported that Shell is considering selling its holdings in the largest U.S. oil field, worth as much as $10B.
The Anglo-Dutch supermajor is said to be evaluating selling all its 260,000 acres (105,200 hectares) holdings in the Permian Basin, located mostly in Texas, according to media reports.
A week ago, Shell CEO Ben van Beurden vowed to “rise to the challenge” in its transition to cleaner energy and pledged to speed up plans to cut greenhouse gas emissions following last month’s court order.
However, a subsequent social media post gives us better insights into how van Beurden actually views the situation:
“Imagine Shell decided to stop selling petrol and diesel today. This would certainly cut Shell’s carbon emissions. But it would not help the world one bit. Demand for fuel would not change. People will fill up their cars and delivery trucks at other service stations,” van Beurden wrote on LinkedIn last week.
He goes on to say:
“Society needs to take urgent action on climate change. But a court ordering one energy company to reduce its emissions – and the emissions of its customers – is not the answer. I believe Shell should work with our customers and their sectors to help them find their own pathways to achieve net-zero emissions. This will help grow demand for new low-carbon products. For companies to invest successfully, they also need bold, clear, and consistent government policies and regulations. Greater collaboration between governments, companies and customers will allow us and others to build up our low-carbon energy businesses in the fastest way.”
Shell’s Big Oil peers might agree with van Beurden’s take.
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