Shell: Oil Production Is On The Decline

Shell, the huge oil company has said that oil production and carbon emissions have peaked as it begins plans to gradually wean off fossil fuels. While climate activists have said that it hadn’t gone far enough.

Shell said in a statement that it expects oil production to decline between 1 and 2% each year after peaking in 2019, while it’s total carbon emissions likely peaked in 2018.

Shell unveiled plans in September to become a net zero emissions business by 2050, including it’s own products that it sells. This is a move which joins them with BP and Total to making shifts to cleaner energy. The oil giants have written off billions of assets, as forecasts warn that demand for oil may never recover from the pandemic. As there has been a change as to how people work and travel.

To achieve these goals, it will sell more clean energy whilst investing in carbon capture and forestation projects. This is an aim to help offset emissions. Shell will also expand it’s biofuels production and distribution business.

“Whether our customers are motorists, households or businesses, we will use our global scale and trusted brand to grow in markets where demand for cleaner products and services is strongest, delivering more predictable cash flows and generating higher returns,” said CEO Ben van Beurden.

Chevron CEO Michael Wirth told CNN Business that it will invest in capture, storage and hydrogen, yet that oil and gas will remain an important part of Chevron’s business for some time. However, this may be the case at Shell too.

Shell’s Oil Production and Clean Energy

Based on the company’s forecasts, their oil production will decline by 18% by 2030 and 45% by 2050. However this still means that by 2050 it will still produce 1M barrels of oil a day in 2050.

They will continue to spend $8B a year into oil exploration and pumping. $2B to $3B annually into renewables and hydrogen, with $8B – $9B going towards integrated gas and chemicals.

“Shell will continue to invest more than 80% in oil and gas in the upcoming years, while investments in renewable energy are lagging far behind,” Friends of the Earth Netherlands, a climate action group, said in a statement.

Friends of the Earth feel that Shell are focsued on the wrong things and are only focusing on offsetting emissions rather than reducing them all together. Yet according to Shell, capital spending will shift to clean energy over time and they are aiming to build low carbon business of significant scale by the early 2030’s.

Shell are hoping to prioritise selling clean electricity to customers rather than investing in renewable power generation. Hoping to double its sales of electricity by 2030 and grow it’s electrical vehicle network from more than 60,000 charge points to 500,000 charge points by 2025. While expecting to sell power to more than 15M retail and business customers worldwide.

(CNN)

Questions

Will oil every go in our lifetime
Have you made the move to electric
Does the move to electric intrigue you
Will you ever go electric
What’s stopping the world from ditching oil
Why should we ditch oil?
Do you believe shell
Would shell ever cease to exist
Is people power the way to change fossil fuel usage
Will work from home have an effect on petrol

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