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Shell plc
Formerly
  • Forthdeal Limited (2002–2004)
  • Royal Dutch Shell plc (2004–2022)[1][2]
Company typePublic
ISINGB00BP6MXD84
Industry
Predecessors
  • Royal Dutch Petroleum Company (1890)
  • The Shell Transport and Trading Company (1897)
FoundedApril 1907;117 years ago(1907-04)(asRoyal Dutch Shell)
20 July 2005;19 years ago(2005-07-20)inShell Centre,London (current entity)
Founders
HeadquartersShell Centre
London,England, UK
Area served
Worldwide
Key people
Products
Brands
RevenueDecreaseUS$316.6 billion (2023)[3]
DecreaseUS$37.3 billion (2023)[3]
DecreaseUS$19.6 billion (2023)[3]
Total assetsDecreaseUS$406.3 billion (2023)[3]
Total equityDecreaseUS$188.4 billion (2023)[3]
Number of employees
90,000 (2023)[4]
Divisions
Subsidiaries
List
Websiteshell.com
Footnotes / references
  • aformerly known as "the Royal Dutch Company for the Exploitation of Petroleum Wells in the Dutch East Indies"

Shell plcis a Britishmultinationaloilandgascompany headquartered inLondon,England.[5]Shell is apublic limited companywith a primary listing on theLondon Stock Exchange(LSE) and secondary listings onEuronext Amsterdamand theNew York Stock Exchange.A core component ofBig Oil,Shell is the second largest investor-owned oil and gas company in the world by revenue (afterExxonMobil), and among theworld's largest companiesout of any industry.[6]Measured by both its own emissions, and the emissions of all the fossil fuels it sells, Shell was theninth-largest corporate producer of greenhouse gas emissionsin the period 1988–2015.

Shell was formed in April 1907 through themergerofRoyal Dutch Petroleum Companyof the Netherlands andThe "Shell" Transport and Trading Companyof the United Kingdom. The combined company rapidly became the leading competitor of the AmericanStandard Oiland by 1920 Shell was the largest producer of oil in the world.[7]Shell first entered the chemicals industry in 1929. Shell was one of the "Seven Sisters"which dominated the global petroleum industry from the mid-1940s to the mid-1970s. In 1964, Shell was a partner in the world's first commercial sea transportation ofliquefied natural gas(LNG).[8]In 1970, Shell acquired the mining companyBilliton,which it subsequently sold in 1994 and now forms part ofBHP.In recent decades gas has become an increasingly important part of Shell's business[9]and Shell acquiredBG Groupin 2016.[9]

Shell isvertically integratedand is active in every area of the oil and gas industry, includingexploration,production,refining,transport,distribution and marketing,petrochemicals,power generation,andtrading.Shell has operations in over 99 countries,[10]produces around 3.7 millionbarrels of oil equivalentper day and has around 44,000 service stations worldwide.[11][12]As of 31 December 2019, Shell had total proved reserves of 11.1 billion barrels (1.76×109m3) of oil equivalent.[13]Shell USA,its principal subsidiary in the United States, is one of its largest businesses.[14]Shell holds 44%[15]ofRaízen,a publicly-listed joint venture withCosan,which is the third-largestBrazil-based energy company.[16]In addition to the main Shell brand, the company also owns theJiffy Lube,PennzoilandQuaker Statebrands.

Shell is a constituent of theFTSE 100 Indexand had amarket capitalisationof US$199 billion on 15 September 2022, the largest of any company listed on the LSE and the 44th-largest of any company in the world.[17]By 2021 revenues, Shell is the second-largest investor-owned oil company in the world (afterExxonMobil), the largest company headquartered in the United Kingdom, the second-largest company headquartered in Europe (afterVolkswagen), and the 15th largest company in the world.[18]Until its unification in 2005 asRoyal Dutch Shell plc,the firm operated as adual-listed company,whereby the British and Dutch companies maintained their legal existence and separate listings but operated as a single-unit partnership. From 2005 to 2022, the company had its headquarters in The Hague, its registered office in London and had two types of shares (A and B). In January 2022, the firm merged the A and B shares, moved its headquarters to London, and changed its legal name toShell plc.[5][19]

History

[edit]

Origins

[edit]
The oil well atPangkalan Brandan,North Sumatra,is considered to be the origin of the Royal Dutch Shell, c. 1905
Shell benzine for Sir Ernest Henry Shackleton, Antarctic Expedition 1915
Royal Dutch Petroleum dock in theDutch East Indies(nowIndonesia), c. 1925

The Royal Dutch Shell Group was created in April 1907 through the amalgamation of two rival companies: the Royal Dutch Petroleum Company (Dutch:Koninklijke Nederlandse Petroleum Maatschappij) of the Netherlands and the Shell Transport and Trading Company Limited of theUnited Kingdom.[20]It was a move largely driven by the need to compete globally withStandard Oil.[21]The Royal Dutch Petroleum Company was a Dutch company founded in 1890 to develop an oilfield inPangkalan Brandan,North Sumatra,[22]and initially led byAugust Kessler,Hugo Loudon, andHenri Deterding.The "Shell" Transport and Trading Company (the quotation marks were part of the legal name) was aBritishcompany, founded in 1897 byMarcus Samuel, 1st Viscount Bearsted,and his brotherSamuel Samuel.[23]Their father had owned an antique company inHoundsditch,London,[24]which expanded in 1833 to import and sell seashells, after which the company "Shell" took its name.[20][25][26]

For various reasons, the new firm operated as adual-listed company,whereby the merging companies maintained their legal existence but operated as a single-unit partnership for business purposes. The terms of the merger gave 60 percent stock ownership of the new group to Royal Dutch, and 40 percent to Shell. Both becameholding companiesforBataafsche Petroleum Maatschappij,containing the production and refining assets, and Anglo-Saxon Petroleum Company, containing the transport and storage assets.[27]National patriotic sensibilities would not permit a full-scale merger or takeover of either of the two companies.[27]The Dutch company,Koninklijke Nederlandsche Petroleum MaatschappijatThe Hague,was in charge of production and manufacture.[28]The BritishAnglo-Saxon Petroleum Companywas based in London, to direct the transport and storage of the products.[28][26]

In 1912, Royal Dutch Shell purchased theRothschilds'Russian oil assetsin a stock deal. The Group's production portfolio then consisted of 53 percent from theEast Indies,29 percent from theRussian Empire,and 17 percent fromRomania.[26][29]

20th century

[edit]
Shell tank truck from 1926 based on aFord Model TT

During theFirst World War,Shell was the main supplier of fuel to theBritish Expeditionary Force.[30]It was also the sole supplier ofaviation fueland supplied 80 percent of the British Army'sTNT.[30]It also volunteered all of its shipping to theBritish Admiralty.[30]

TheGerman invasion of Romaniain 1916 saw 17% of the group's worldwide production destroyed.[30]In 1919, Shell took control of theMexican Eagle Petroleum Companyand in 1921 formed Shell-Mex Limited, which marketed products under the "Shell" and "Eagle" brands in the United Kingdom. During theGenoa Conferenceof 1922 Royal Dutch Shell was in negotiations for amonopolyover Soviet oilfields inBakuandGrosny,although the leak of a draft treaty led to breakdown of the talks.[31]In 1929,Shell Chemicalswas founded.[30]By the end of the 1920s, Shell was the world's leading oil company, producing 11 percent of the world'scrude oilsupply and owning 10 percent of its tanker tonnage.[30]

During theSpanish Civil Warthe company sold oil to the Nationalist side ofFrancisco Franco.[32]

1932 Shell advertisement poster by the British surrealist painterPaul Nash

Located in the north bank of theRiver Thamesin London,Shell Mex Housewas completed in 1931, and was the head office for Shell's marketing activity worldwide.[30]In 1932, partly in response to the difficult economic conditions of theGreat Depression,Shell-Mex merged its UK marketing operations with those ofBP(British Petroleum) to createShell-Mex & BP,[33]a company that traded until the brands separated in 1975. Royal Dutch Company ranked 79th among United States corporations in the value ofWorld War IImilitary production contracts.[34]

Vintage petrol pump (1952)

The 1930s saw Shell's Mexican assets seized by the local government.[30]After theinvasion of the NetherlandsbyNazi Germanyin 1940, the head office of the Dutch companies was moved toCuraçao.[30]In 1945, Shell's Danish headquarters inCopenhagen,at the time being used by theGestapo,was bombed byRoyal Air ForceDe Havilland MosquitoesinOperation Carthage.[35]

In 1937,Iraq Petroleum Company(IPC), 23.75 percent owned by Royal Dutch Shell plc,[36]signed an oil concession agreement with theSultan of Muscat.In 1952, IPC offered financial support to raise an armed force that would assist the Sultan in occupying the interior region ofOman,an area that geologists believed to be rich in oil. This led to the 1954 outbreak of theJebel Akhdar Warin Oman that lasted for more than 5 years.[37]

Royal Dutch Shellfilling station and garage inMijnsheerenland,the Netherlands, late-1970s

Around 1952, Shell was the first company to purchase and use acomputerin the Netherlands.[38]The computer, aFerranti Mark 1*,was assembled and used at the Shell laboratory in Amsterdam. In 1970, Shell acquired the mining companyBilliton,which it subsequently sold in 1994.[39]

In 1989, Shell redesigned a $3-billion natural gas platform in theNorth Sea,raising its height one to two meters, to accommodate an anticipatedsea level risedue toglobal warming.[40]

In the 1990s, protesters criticised the company's environmental record, particularly the possible pollution caused by the proposed disposal of theBrent Sparplatform into the North Sea. Despite support from the UK government, Shell reversed the decision under public pressure but maintained that sinking the platform would have been environmentally better.[41]Shell subsequently published an unequivocal commitment tosustainable development,supported by executive speeches reinforcing this commitment.[42]Shell was subsequently criticised by theEuropean Commissionand fiveEuropean Unionmembers after deciding to leave part of its decommissioned oil rigs standing in the North Sea. Shell argued that removing them would be too costly and risky. Germany said that the estimated 11,000 tonnes of raw oil and toxins remaining in the rigs would eventually seep into the sea, and called it a 'ticking timebomb'.[43]

On 15 January 1999, off theArgentiniantown ofMagdalena, Buenos Aires,the Shell tankerEstrella pampeanacollided with a Germancargo ship,emptying its contents into the lake, polluting the environment, drinkable water, plants and animals. Over a decade after the spill, a referendum held in Magdalena determined the acceptance of a US$9.5 million compensatory payout from Shell.[44]Shell denied responsibility for the spill, but an Argentine court ruled in 2002 that the corporation was responsible.[45]

21st century

[edit]
Former Shell Research and Technology Centre,Amsterdam,c. 2000
A Shell JET A refueller truck on the ramp atVancouver International Airport,2005

In 2002, Shell acquiredPennzoil-Quaker Statethrough its American division for $22 USD per share, or about $1.8 billion USD. Through its acquisition of Pennzoil, Shell became adescendant of Standard Oil.With its acquisition, Shell inherited multiple auto part brands includingJiffy Lube,Rain-X,andFix-a-Flat.The company was notably late in its acquisition as seen by journalists, with Shell seen as streamlining its assets around the same time of other major mergers and acquisitions in the industry, such asBP's purchase ofAmocoand the merger ofExxonandMobil.[46]

Shell Gas Station at Gaya Street Sunday Market,Kota Kinabalu

In 2004, Shell overstated its oil reserves, resulting in loss of confidence in the group, a £17 million fine by theFinancial Services Authorityand the departure of the chairmanPhilip Watts.A lawsuit resulted in the payment of $450 million to non-American shareholders in 2007.[47][48][49]

As a result of the scandal, the corporate structure was simplified. Two classes of ordinary shares, A (code RDSA) and B (code RDSB), identical but for the tax treatment of dividends, were issued for the company.[50]

Shell filling station in the UK, 2006

In November 2004, following a period of turmoil caused by the revelation that Shell had been overstating itsoil reserves,it was announced that the Shell Group would move to a single capital structure, creating a new parent company to be named Royal Dutch Shell plc, with its primary listing on the LSE, a secondary listing onEuronext Amsterdam,its headquarters and tax residency inThe Hague,Netherlands and its registered office in London. The company was already incorporated in 2002 asForthdeal Limited,ashelf corporationincorporated by Swift Incorporations Limited and Instant Companies Limited, both based in Bristol.[19]The unification was completed on 20 July 2005 and the original owners delisted their companies from the respective exchanges. On 20 July 2005, the Shell Transport & Trading Company plc was delisted from the LSE,[51]whereas, Royal Dutch Petroleum Company from theNew York Stock Exchangeon 18 November 2005.[52]The shares of the company were issued at a 60/40 advantage for the shareholders of Royal Dutch in line with the original ownership of the Shell Group.[53]

During the2009 Iraqi oil services contracts tender,a consortium led by Shell (45%) and which includedPetronas(30%) was awarded a production contract for the "Majnoon field" in the south of Iraq, which contains an estimated 12.6 billion barrels (2.00×109m3) of oil.[54][55]The "West Qurna 1 field" production contract was awarded to a consortium led byExxonMobil(60%) and included Shell (15%).[56]

In February 2010, Shell andCosanformed a 50:50 joint-venture,Raízen,comprising all of Cosan's Brazilian ethanol, energy generation, fuel distribution and sugar activities, and all of Shell's Brazilian retail fuel and aviation distribution businesses.[57]In March 2010, Shell announced the sale of some of its assets, including its liquefied petroleum gas (LPG) business, to meet the cost of a planned $28bn capital spending programme. Shell invited buyers to submit indicative bids, due by 22 March, with a plan to raise $2–3bn from the sale.[58]In June 2010, Shell agreed to acquire all the business ofEast Resourcesfor a cash consideration of $4.7 billion. The transaction included East Resources' tight gas fields.[59]

Over the course of 2013, the corporation began the sale of itsUS shale gasassets and canceled a US$20 billion gas project that was to be constructed in the US state ofLouisiana.A new CEOBen van Beurdenwas appointed in January 2014, prior to the announcement that the corporation's overall performance in 2013 was 38 percent lower than in 2012—the value of Shell's shares fell by 3 percent as a result.[60]Following the sale of the majority of itsAustralianassets in February 2014, the corporation plans to sell a further US$15 billion worth of assets in the period leading up to 2015, with deals announced in Australia, Brazil and Italy.[61]

Shell announced on 8 April 2015 it had agreed to buyBG Groupfor £47 billion (US$70 billion), subject to shareholder and regulatory approval.[62]The acquisition was completed in February 2016, resulting in Shell surpassingChevron Corporationand becoming the world's second largest non-state oil company.[63]

On 7 June 2016, Shell announced that it would build anethane cracker plantnearPittsburgh,Pennsylvania,after spending several years doing an environmental cleanup of the proposed plant's site.[64]

In January 2017, Shell agreed to sell £2.46bn worth ofNorth Seaassets to oil exploration firm Chrysaor.[65]In 2017, Shell sold itsoil sandsassets toCanadian Natural Resourcesin exchange of approximately 8.8% stake in that company. In May 2017, it was reported that Shell plans to sell its shares in Canadian Natural Resources fully exiting the oil sands business.[66]

On 5 November 2017, theParadise Papers,a set of confidentialelectronic documentsrelating tooffshore investment,revealed that Argentine Energy MinisterJuan José Arangurenwas revealed to have managed theoffshore companies'Shell Western Supply and Trading Limited' and 'Sol Antilles y Guianas Limited', both subsidiaries of Shell. One is the main bidder for the purchase of diesel oil by the government through the state ownedCAMMESA(Compañía Administradora del Mercado Mayorista Eléctrico).[67]

On 30 April 2020, Shell announced that it would cut itsdividendfor the first time since theSecond World War,due to theoil price collapsefollowing the reduction in oil demand during theCOVID-19 pandemic.Shell stated that their net income adjusted for the cost of supply dropped to US$2.9 billion in three months to 31 March. This compared with US$5.3 billion in the same period the previous year.[68]On 30 September 2020, the company said that it would cut up to 9,000 jobs as a result of the economic effects caused by the pandemic and announced a "broad restructuring".[69]In December 2020, Shell forecast another write-down of $3.5-4.5 billion for the fourth quarter due to lower oil prices, following $16.8 billion of impairment in the second quarter.[70]

In February 2021, Shell announced a loss of $21.7 billion in 2020 due to the COVID-19 pandemic,[71]despite reducing its operating expenses by 12%, or $4.5 billion, according to aMorningstaranalysis cited byBarron's.[72][73]

In November 2021, Shell announced that it is planning to relocate their headquarters to London, abandon its dual share structure, and change its name from Royal Dutch Shell plc to Shell plc.[74]The company's name change was registered in theCompanies Houseon 21 January 2022.[19]

In December 2021, Shell pulled out of theCambo oil field,off the Shetland Islands, claiming that "the economic case for investment in this project is not strong enough at this time, as well as having the potential for delays". The proposed oilfield had been the subject of intense campaigning by environmentalists in the run-up to the COP26 UN climate summit in Glasgow in November 2021.[75]

On 4 March 2022, during theRussian invasion of Ukraineand in the midst of the growingboycott of Russian economy and related divestments,Shell bought a cargo of discounted Russian crude oil.[76]The next day, following criticism from Ukraine's Foreign MinisterDmytro Kuleba,Shell defended the purchase as a short term necessity, but also announced that it intended to reduce such purchases, and it would put profits from any Russian oil it purchases into a fund that would go towards humanitarian aid to Ukraine.[77]On 8 March, Shell announced that it would stop buying Russian oil and gas and close its service stations in the country.[78]

In 2022, the major oil and gas companies, including Shell,[79]reported sharp rises in interim revenues and profits.[80]In fact, this rise in profit for Shell was so sharp, that 2022 was the company's best year, as Shell recorded double the profits from 2021, and the highest profit in its entire history.[81]

Corporate affairs

[edit]
Big Oil companies[a]
Company Revenue (USD)[82] Profit (USD) Brands
ExxonMobil $286 billion $23 billion Mobil
Esso
Imperial Oil
Shell plc $273 billion $20 billion Jiffy Lube
Pennzoil
Z Energy
TotalEnergies $185 billion $16 billion Elf Aquitaine
SunPower
BP $164 billion $7.6 billion Amoco
Aral AG
Chevron $163 billion $16 billion Texaco
Caltex
Havoline
Marathon $141 billion $10 billion ARCO[83]
Phillips 66 $115 billion $1.3 billion 76
Conoco
JET
Valero $108 billion $0.9 billion
Eni $77 billion $5.8 billion
ConocoPhillips $48.3 billion $8.1 billion
[edit]

The key trends of Shell are (as at the financial year ending 31 December):[84]

Year Revenue (US$ bn) Net income (US$ bn) Employees
2017 305 12.9 86.000
2018 388 23.3 82.000
2019 344 15.8 83.000
2020 180 –21.6 87.000
2021 261 20.1 82.000
2022 381 42.3 87.000
2023 316 19.3 87.000

Management

[edit]

On 4 August 2005, the board of directors announced the appointment ofJorma Ollila,chairman and CEO ofNokiaat the time, to succeed Aad Jacobs as the company's non-executive chairman on 1 June 2006. Ollila is the first Shell chairman to be neither Dutch nor British. Other non-executive directors includeMaarten van den Bergh,Wim Kok,Nina Henderson,Lord Kerr,Adelbert van Roxe, and Christine Morin-Postel.[85]

Since 3 January 2014,Ben van Beurdenhas been CEO of Shell.[60]His predecessor wasPeter Voserwho became CEO of Shell on 1 July 2009.[86]

Following a career at the corporation, in locations such as Australia and Africa, Ann Pickard was appointed as the executive vice president of the Arctic at Royal Dutch Shell, a role that was publicized in an interview withMcKinsey & Companyin June 2014.[87]

In January 2023,Wael Sawansucceeded Ben van Beurden as CEO.[88]

Historical leadership

[edit]
[edit]

The name Shell is linked to The "Shell" Transport and Trading Company.[89]In 1833, the founder's father, Marcus Samuel Sr., founded an import business to sellseashellsto London collectors. When collecting seashellspecimensin theCaspian Seaarea in 1892, the younger Samuel realised there was potential in exportinglamp oilfrom the region and commissioned the world's first purpose-builtoil tanker,theMurex(Latin for a type ofsnail shell), to enter this market; by 1907 the company had a fleet. Although for several decades the company had a refinery atShell Havenon the Thames, there is no evidence of this having provided the name.[90]

The Shell logo is one of the most familiar commercial symbols in the world. This logo is known as the "pecten"after the sea shellPecten maximus(the giantscallop), on which its design is based. The yellow and red colours used are thought[91]to relate to the colours of theflag of Spain,as Shell built early service stations inCalifornia,previously aSpanish colony.The current revision of the logo was designed byRaymond Loewyin 1971.[92]

The slash was removed from the name "Royal Dutch/Shell" in 2005, concurrent with moves to merge the two legally separate companies (Royal Dutch and Shell) to the single legal entity which exists today.[93]

On 15 November 2021, Royal Dutch Shell plc announced plans to change its name to Shell plc.[94]

Logo evolution

[edit]
Notes
  1. ^Designed byRaymond Loewy.[92]

Operations

[edit]
Sales by business (2022)[95]
Business share
Chemicals and Products 37.9%
Service stations 31.6%
Integrated Gas 14.4%
Renewable and Energy Solutions 13.9%
Upstream 2.2 %
Corporate Segment 0.0 %

Business groupings

[edit]
Mars oil platformoperated as a joint venture between Shell andBPin theGulf of Mexico.

Shell is organised into four major business groupings:[96]

  • Upstream– manages the upstream business. It searches for and recoverscrude oilandnatural gasand operates the upstream and midstream infrastructure necessary to deliver oil and gas to the market. Its activities are organised primarily within geographic units, although there are some activities that are managed across the business or provided through support units.
  • Integrated Gas and New Energies– manages toliquefy natural gas,converting gas to liquids and low-carbon opportunities.
  • Downstream– manages Shell's manufacturing, distribution, and marketing activities for oil products and chemicals. Manufacturing and supply include refinery, supply, and shipping of crude oil.
  • Projects and technology– manages the delivery of Shell's major projects, provides technical services and technology capability covering both upstream and downstream activities. It is also responsible for providing functional leadership across Shell in the areas of health, safety and environment, and contracting and procurement.

Oil and gas activities

[edit]
Europe's largest refinery, Shell Pernis, inRotterdam,2019
Filling station inArgos, Peloponneseowned by Shell. Shell and local subsidiaries own and operate thousands of filling stations worldwide.

Shell's primary business is the management of avertically integratedoil company. The development of technical and commercial expertise in all stages of this vertical integration, from the initial search for oil (exploration) through its harvesting (production), transportation,refiningand finally trading and marketing established the core competencies on which the company was founded. Similar competencies were required for natural gas, which has become one of the most important businesses in which Shell is involved, and which contributes a significant proportion of the company's profits. While the vertically integrated business model provided significanteconomies of scaleandbarriers to entry,each business now seeks to be a self-supporting unit without subsidies from other parts of the company.[97]

Traditionally, Shell was a heavily decentralised business worldwide (especially in the downstream) with companies in over 100 countries, each of which operated with a high degree of independence. The upstream tended to be far more centralised with much of the technical and financial direction coming from the central offices inThe Hague.The upstream oil sector is also commonly known as the "exploration and production" sector.[98]

Downstream operations, which now also includes the chemicals business, generate the majority of Shell's profits worldwide and is known for its global network of more than 40,000petrol stationsand its variousoil refineries.The downstream business, which in some countries also includedoil refining,generally included a retailpetrol stationnetwork, lubricants manufacture and marketing, industrial fuel and lubricants sales, and a host of other product/market sectors such asLPGandbitumen.The practice in Shell was that these businesses were essentially local and that they were best managed by local "operating companies" – often with middle and senior management reinforced byexpatriates.[99]

Sponsorships

[edit]
Valentino RossiMotoGP 2011 Malaysia Test 1

Shell has a long history of motorsport sponsorship, most notablyScuderia Ferrari(1951–1964, 1966–1973 and 1996-present),BRM(1962–1966 and 1968–1972),Scuderia Toro Rosso(2007–2013 and 2016),McLaren(1967–1968 and 1984–1994),Lotus(1968–1971),Ducati Corse(since 1999),Team Penske(2011–present),Hyundai Motorsport(since 2005),AF Corse,Risi Competizione,BMW Motorsport(2015–present with alsoPennzoil) andDick Johnson Racing(1987-2004and2017–present).[100]

Starting in 2023, Shell became the official fuel forIndyCar Series,supplying E100 race fuel for all teams.[101]

In motorcycle racing, Shell andDucatihave been working together globally for a very long time. Shell has indeed been working with Ducati since 1999, through the first support in theSuperbike.The support continues to win more than 150 races, including seven MotoGP world champions.Both in lubricants and fuel products which have now been established for 25 years. This long-term cooperation contract has just been extended in theNetherlandsat 2024 and will continue until the end of 2027.[102]

Operations by region

[edit]
Sales by region (2022)[95]
Region share
Asia, Oceania, Africa 33.2%
United States 22.8%
Europe 22.5%
United Kingdom 13.2%
Other Americas 8.3 %

Arctic

[edit]

Kulluk oil rig

[edit]
The conical drilling unit Kulluk, 2013

Following the purchase of an offshore lease in 2005, Shell initiated its US$4.5 billionArcticdrilling program in 2006, after the corporation purchased the "Kulluk"oil rig and leased the Noble Discoverer drillship.[103][104]At inception, the project was led by Pete Slaiby, a Shell executive who had previously worked in theNorth Sea.[105]However, after the purchase of a second offshore lease in 2008, Shell only commenced drilling work in 2012, due to the refurbishment of rigs, permit delays from the relevant authorities and lawsuits.[106][107][108]The plans to drill in the Arctic led to protests from environmental groups, particularlyGreenpeace;furthermore, analysts in the energy field, as well as related industries, also expressed skepticism due to perceptions that drilling in the region is "too dangerous because of harsh conditions and remote locations".[108][109]

Further problems hampered the Arctic project after the commencement of drilling in 2012, as Shell dealt with a series of issues that involved air permits,Coast Guardcertification of a marine vessel, and severe damage to essential oil-spill equipment. Additionally, difficult weather conditions resulted in the delay of drilling during mid-2012 and the already dire situation was exacerbated by the "Kulluk" incident at the end of the year. Shell had invested nearly US$5 billion by this stage of the project.[105][108]

As theKullukoil rig was being towed to the American state ofWashingtonto be serviced in preparation for the 2013 drilling season, a winter storm on 27 December 2012 caused the towing crews, as well as the rescue service, to lose control of the rig. As of 1 January 2013, the Kulluk was grounded off the coastSitkalidak Island,near the eastern end ofKodiak Island.Following the accident, aFortunemagazine contacted Larry McKinney, the executive director at the Harte Research Institute for Gulf of Mexico Studies atTexas A&M,and he explained that "A two-month delay in the Arctic is not a two-month delay... A two-month delay could wipe out the entire drilling season".[105]

It was unclear if Shell would recommence drilling in mid-2013, following the "Kulluk" incident, and, in February 2013, the corporation stated that it would "pause" its closely watched drilling project off theAlaskancoast in 2013, and will instead prepare for future exploration.[110]In January 2014, the corporation announced the extension of the suspension of its drilling program in the Arctic, with chief executive van Beurden explaining that the project is "under review" due to both market and internal issues.[111]

A June 2014 interview with Pickard indicated that, following a forensic analysis of the problems encountered in 2012, Shell will continue with the project and Pickard stated that she perceives the future of the corporation activity in the Arctic region as a long-term "marathon".[87]Pickard stated that the forensic "look back" revealed "there was an on/off switch" and further explained:

In other words, don't spend the money unless you're sure you're going to have the legal environment to go forward. Don't spend the money unless you're sure you're going to have the permit. No, I can't tell you that I'm going to have that permit until June, but we need to plan like we're going to have that permit in June. And so probably the biggest lesson is to make sure we could smooth out the on/off switches wherever we could and take control of our own destiny.[87]

Based upon the interview with Pickard, Shell is approaching the project as an investment that will reap energy resources with a lifespan of around 30 years.[87]

According to theBureau of Ocean Energy Managementreport in 2015 the chances of a major spill in a deep-sea Arctic drilling is 75% before century's end.[112]

Kodiak Island

[edit]

In 2010, Greenpeace activists painted "No Arctic Drilling" using spilledBPoil on the side of a ship in theGulf of Mexicothat was en route to explore forArcticoil for Shell. At the protest,Phil Radfordof Greenpeace called for "President Obama[to] ban all offshore oil drilling and call for an end to the use of oil in our cars by 2030 ".[109]

On 16 March 2012, 52 Greenpeace activists from five different countries boardedFennicaandNordica,multipurposeicebreakerschartered to support Shell's drilling rigs near Alaska.[113]Around the same time period, a reporter forFortunemagazinespoke withEdward Itta,anInupiatleader and the former mayor of theNorth Slope Borough,who expressed that he was conflicted about Shell's plans in the Arctic, as he was concerned that an oil spill could destroy the Inupiat peoples hunting-and-fishing culture, but his borough also received major tax revenue from oil and gas production; additionally, further revenue from energy activity was considered crucial to the future of the living standard in Itta's community.[105]

In July 2012, Greenpeace activists shut down 53 Shell petrol stations inEdinburghandLondonin a protest against the company's plans to drill for oil in the Arctic. Greenpeace's "Save the Arctic"campaign aims to prevent oil drilling andindustrial fishingin the Arctic by declaring the uninhabited area around the North Pole a global sanctuary.[114]

A review was announced after theKullukoil rig ran aground near Kodiak Island in December 2012.[115]

In response, Shell filed lawsuits to seek injunctions from possible protests, andBenjamin Jealousof theNAACPand Radford argued that the legal action was "trampling Americans' rights".[116]According to Greenpeace, Shell lodged a request with Google to take down video footage of a Greenpeace protest action that occurred at the Shell-sponsoredFormula One(F1) Belgian Grand Prix on 25 August 2013, in which "SaveTheArctic.org" banners appear at the winners' podium ceremony. In the video, the banners rise up automatically—activists controlled their appearance with the use of four radio car antennas—revealing the website URL, alongside an image that consists of half of a polar bear's head and half of the Shell logo.[117]

Shell then announced a "pause" in the timeline of the project in early 2013[110]and, in September 2015, the corporation announced the extension of the suspension of its drilling program in the Arctic.[118]

Polar Pioneer rig

[edit]

A June 2014 interview with the corporation's new executive vice president of the Arctic indicated that Shell will continue with its activity in the region.[87][111]

InSeattleprotests began in May 2015in response to the news that thePort of Seattlemade an agreement with Shell to berth rigs at the Port's Terminal 5 during the off-season ofoil explorationinAlaskanwaters. The arrival of Shell's new Arctic drilling vessel,Polar Pioneer(IMO number:8754140), asemi-submersibleoffshore drillingrig, was greeted by large numbers of environmental protesters paddling kayaks inElliott Bay.[119][120]

On 6 May 2015, it was reported that during a coast guard inspection ofPolar Pioneer,a piece of anti-pollution gear failed, resulting in fines and delay of the operation.[121]Oil executives from Total and Eni interviewed by theNew York Times,expressed scepticism about Shell's new ambitions for offshore drilling in the Arctic, and cited economic and environmental hurdles.ConocoPhillipsandEquinor (formerly Statoil)suspended Arctic drilling earlier, after Shell's failed attempt in 2012.[122]

Australia

[edit]

On 20 May 2011, Shell's final investment decision for the world's firstfloating liquefied natural gas(FLNG) facility was finalized following the discovery of the remote offshore Prelude field—located off Australia's northwestern coast and estimated to contain about 3 trillion cubic feet of natural gas equivalent reserves—in 2007. FLNG technology is based on liquefied natural gas (LNG) developments that were pioneered in the mid-20th century and facilitates the exploitation of untapped natural gas reserves located in remote areas, often too small to extract any other way.[123][124]

Thefloating vesselto be used for the Prelude field, known asPreludeFLNG,is promoted as the longest floating structure in the world and will take in the equivalent of 110,000 barrels of oil per day in natural gas—at a location 200 km (125 miles) off the coast ofWestern Australia—and cool it into liquefied natural gas for transport and sale in Asia. The Prelude is expected to start producing LNG in 2017[125]—analysts estimated the total cost of construction at more thanUS$12 billion.[123][124][126]

Following the decision by the Shell fuel corporation to close itsGeelong Oil Refineryin Australia in April 2013, a third consecutive annual loss was recorded for Shell's Australian refining and fuel marketing assets. Revealed in June 2013, the writedown is worthA$203 million and was preceded by a A$638m writedown in 2012 and a A$407m writedown in 2011, after the closure of theClyde RefineryinSydney,Australia.[127]

In February 2014, Shell sold its Australian refinery and petrol stations for US$2.6 billion (A$2.9 billion) to Swiss companyVitol.[128]

At the time of the downstream sale to Vitol, Shell was expected to continue investment into Australian upstream projects, with projects that involve Chevron Corp.,Woodside Petroleumand Prelude.[61]In June 2014, Shell sold 9.5% of its 23.1% stake inWoodside Petroleumand advised that it had reached an agreement for Woodside to buy back 9.5% of its shares at a later stage. Shell became a major shareholder in Woodside after a 2001 takeover attempt was blocked by then federal TreasurerPeter Costelloand the corporation has been open about its intention to sell its stake in Woodside as part of its target to shed assets. At a general body meeting, held on 1 August 2014, 72 percent of shareholders voted to approve the buy-back, short of the 75 percent vote that was required for approval. A statement from Shell read: "Royal Dutch Shell acknowledges the outcome of Woodside Petroleum Limited's shareholders' negative vote on the selective buy-back proposal. Shell is reviewing its options in relation to its remaining 13.6 percent holding".[129]

Brunei

[edit]

Brunei Shell Petroleum (BSP) is a joint venture between the Government ofBruneiand Shell.[130]The British Malayan Petroleum Company (BMPC), owned by Royal Dutch Shell, first found commercial amounts of oil in 1929.[131]It currently produces 350,000 barrels of oil and gas equivalent per day.[132]BSP is the largest oil and gas company in Brunei, a sector which contributes 90% of government revenue.[133]In 1954, the BMPC in Seria had a total of 1,277 European and Asian staff.[134]

China

[edit]

The company has upstream operations in unconventionaloilandgasin China. Shell has a joint venture withPetroChinaat the Changbeitight gasfield inShaanxi,which has produced natural gas since 2008. The company has also invested in exploring forshale oilinSichuan.[135]The other unconventional resource which Shell invested in in China was shale. The company was an early entrant in shale oil exploration in China but scaled down operations in 2014 due to difficulties with geology and population density.[136]It has a joint venture to explore foroil shaleinJilinthrough a joint venture with Jilin Guangzheng Mineral Development Company Limited.[137]

In May 2024, Shell announced an exit from China power market business to focus on more profitable operations.[138]

Hong Kong

[edit]

Shell has been active inHong Kongfor a century, providing Retail, LPG, Commercial Fuel, Lubricants, Bitumen, Aviation, Marine and Chemicals services, and products. Shell also sponsored the first Hong Kong-built aircraft,Inspiration,for its around-the-world trip.[139]

India

[edit]

Shell India has inaugurated its new lubricants laboratory at its Technology Centre inBangalore.[140]

Indonesia

[edit]

Shell started operating in Indonesia since1928.Shell started operatinggas stationsinIndonesiasinceNovember 12005. Its first gas station was located inLippo Karawaci,Tangerang.OnMarch 12006,Shell opened a gas station inJakartalocated on Jalan S. Parman (Slipi). As of 2022, the fuels that Shell sells in Indonesia are Shell Super,Shell V-Power,Shell V-Power Nitro+,Shell V-Power Dieseland Shell Diesel Extra.[141]

Ireland

[edit]

Shell first started trading in Ireland in 1902.[142]Shell E&P Ireland (SEPIL) (previously Enterprise Energy Ireland) is an Irish exploration and production subsidiary of Royal Dutch Shell. Its headquarters are onLeeson StreetinDublin.It was acquired in May 2002.[143]Its main project is theCorrib gas project,a large gas field off the northwest coast, for which Shell has encounteredcontroversy and protestsin relation to the onshore pipeline and licence terms.[144]

In 2005, Shell disposed of its entire retail and commercial fuels business in Ireland toTopaz EnergyGroup. This included depots, company-owned petrol stations and supply agreements stations throughout the island of Ireland.[145]The retail outlets were re-branded as Topaz in 2008/9.[146]

The Topaz fuel network was subsequently acquired in 2015 byCouchetard[147]and these stations began re-branding toCircle Kin 2018.[148]

Italy

[edit]
Shell service station in San Jacopino (Florence)

Shell's activities in Italy began on 13 July 1912, with the creation of "Nafta",[149]based inLa Spezia,founded after taking advantage of the weakness of the formerStandard Oil Trust,dissolved the previous year.[150]

During theFirst World War,Nafta abandoned the private sector, focusing on the war supplies to theItalian state.During the conflict, the company expanded, with the opening of new plants inNaplesandAugustaand, after the end of hostilities, with the exploitation of further internal deposits.[151]

In thefirst post-war period,the company controlled the Italian internal market together with the SIAP, the local branch of theStandard of New Jersey (Esso).In 1921, under pressure from theCEOGiovanni Attilio Pozzo (then also elected president in 1923), the share capital was increased reaching 100 million lire.[150]The products sold at the time included "Bentero Shell" and "Aureola Petroli".[151]

In 1922, despite the difficult economic situation of the country, the company grew, and the newVado Ligureplant was inaugurated.[150]The inauguration, however, caused a short political clash between thePrime MinisterFactaand thesocialistdeputyTonello, who in aparliamentary questionharshly criticized the official telegram sent by Facta to "Nafta" on the occasion of the ceremony.[150]In the same year, the works for a coastal system inVenicealso continued.[151]

The birth ofAgipcreated some disagreements between Nafta and theMinistry of the National Economy,which in 1926 asked the Prefects to subordinate the release of new concessions for the plant ofpetrol stationsto a approval estimate of Agip; the question was resolved peacefully in 1927 on the initiative of the Italian company itself.[150]

At the end of the decade, taking advantage of a particularly advantageous legislation, the company launched into therefining sector,with the establishment of subsidiary companies in La Spezia.[150]

On 27 April 1939, Pozzo left "Nafta", after twenty years at the head of the company. The company controlled about 20% of the Italian market at the time.[150]

On 8 August 1940, following Italy's entry into theSecond World War,Nafta was seized and placed under the management of Agip, followed the following year by the US companies operating in Italy (SIAP,Vacuum,Texaco). On 30 July 1942 foreign oil companies were officially transferred to Agip, although the integration of their activities was somewhat complex and remained substantially unfinished. On 22 October 1945, after the end of hostilities, the measures were abandoned and the NAFTA and the other companies, under the guidance of the Italian Petroli Committee, returned to normal activity.[150]

In 1949 the company, now fully restored, was renamed "Shell Italiana S.p.A". with a share capital of more than 2 billion lira.[150]Still in the early 1960s, Shell covered about 20% of the Italian oil needs.[150]

The Italian Shell was the first company to be advertised withCarosello.[152][153]

In 1959 the company purchased the former Condor refinery ofRhoand in 1967 it built a large plant inTaranto,[150]whose works began in 1964 with an initial investment of 25 billion lire.[154]

Shell remained active in the country until April 1974 when, following difficulties in the oil sector caused by theKippur Warand the general conditions of the Italian economy, now not very favorable, the old company was sold toEni,which becameItaliana Petroli (IP).[150]The company then returned to the fuel distribution in 1980,[155]with the acquisition of theConoconetwork,[156]while in 1987 the joint venture withMontedisonwhich led to the creation ofMonteShell.[157]

In July 2014 Shell gave its network of service stations and fuel deposits in Italy to theKuwait Petroleum Italia(Q8).[158]

In 2022 an agreement was announced with the Pad Multiegy company, for the brand to be restored and Shell products to be sold in over 500 Italian service stations,[159]the first of which was inaugurated in March 2022.[160]

In Italy today Shell operates through Shell Italia S.p.A. controlled by Shell Italia Finanza S.p.A. The main locations are inSesto San GiovanniandRome.[161]

Malaysia

[edit]
AShellfilling station inSabah,Malaysia

Shell discovered the first oil well in Borneo in 1910, inMiri,Sarawak.Today, the oil well is a state monument known as the Grand Old Lady. In 1914, following this discovery, Shell built Borneo's first oil refinery and laid a submarine pipeline inMiri.[162][163]

Nigeria

[edit]

Shell began production inNigeriain 1958.[164]InNigeria,Shell told US diplomats that it had placed staff in all the main ministries of thegovernment.[165]Shell continues however upstream activities/extracting crude oil in the oil-richNiger Deltaas well as downstream/commercial activities inSouth Africa.In June 2013, the company announced a strategic review of its operations in Nigeria, hinting that assets could be divested.[166][167]In August 2014, the company disclosed it was in the process of finalizing the sale of its interests in fourNigerian oil fields.[168]On 29 January 2021 a Dutch court ruled that Shell was responsible for multiple oil leaks in Nigeria.[169]

The actions of companies like Shell has led to extremeenvironmental issues in the Niger Delta.Many pipelines in the Niger Delta owned by Shell are old and corroded. Shell has acknowledged its responsibility for keeping the pipelines new but has also denied responsibility for environmental causes.[170]The heavy contamination of the air, ground and water with toxic pollutants by the oil industry in the Niger Delta is often used as an example ofecocide.[171][172][173][174]This has led to mass protests from theNiger Deltainhabitants,Amnesty International,andFriends of the Earththe Netherlands against Shell. It has also led to action plans to boycott Shell byenvironmentalandhuman rights groups.[175]In January 2013, a Dutch court rejected four out of five allegations brought against the firm over oil pollution in the Niger Delta but found a subsidiary guilty of one case of pollution, ordering compensation to be paid to a Nigerian farmer.[176]

Nordic countries

[edit]

On 27 August 2007, Shell andReitan Group,the owner of the7-Elevenbrand inScandinavia,announced an agreement to re-brand some 269 service stations acrossNorway,Sweden,FinlandandDenmark,subject to obtaining regulatory approvals under the differentcompetition lawsin each country.[177]In April 2010 Shell announced that the corporation is in process of trying to find a potential buyer for all of its operations in Finland and is doing similar market research concerning Swedish operations.[178][179]In October 2010 Shell's gas stations and the heavy vehicle fuel supply networks in Finland and Sweden, along with a refinery located inGothenburg,Sweden were sold toSt1,a Finnish energy company, more precisely to its major shareholding parent company Keele Oy.[180]

North America

[edit]
Shellgasolinestation sign inPhoenix, Arizona

Through most of Shell's early history,Shell USAbusiness in the United States was substantially independent. Its stock was traded on theNYSE,and the group's central office had little direct involvement in running the operation. However, in 1984, Shell made a bid to purchase those shares of Shell Oil Company it did not own (around 30%) and, despite opposition from some minority shareholders which led to a court case, Shell completed the buyout for a sum of $5.7 billion.[181]

Philippines

[edit]
Shell oil depot (Poro Point,San Fernando, La Union,Philippines)

Royal Dutch Shell operates in thePhilippinesunder its subsidiary,Pilipinas Shell Petroleum CorporationorPSPC.Its headquarters is inTaguigand it has facilities in thePandacan oil depotand other key locations.[182]

In January 2010, theBureau of Customsclaimed 7.34 billion pesos worth of unpaidexcise taxesagainstPilipinas Shellfor importing Catalytic cracked gasoline (CCG) and light catalytic cracked gasoline (LCCG) stating that those imports are bound for tariff charges.[183]

In August 2016, Pilipinas Shell filed an application to sell US$629 million worth of primary and secondary shares to the investing public (registration statement) with theSEC.This was a prelude to filing its IPO listing application with thePhilippine Stock Exchange.On 3 November 2016 the Pilipinas Shell Petroleum Corporation was officially listed on thePhilippine Stock Exchangeunder the ticker symbol SHLPH after they held itsinitial public offeringon 19 to 25 October of the same year.[184]

Due to the economic slowdown caused by the COVID-19 pandemic on the global, regional and local economies, continually low refining margins, and competition with imported refined products, the management of Pilipinas Shell announced in August 2020 that the 110,000 bbl/d refinery in Tabangao, Batangas, which started operations in 1962, will be shutting down permanently and turned into an import terminal instead.[185]

Russia

[edit]

In February 2022, Shell exited all its joint ventures withGazprombecause of the2022 Russian invasion of Ukraine[186]and, in March 2022, Shell announced that it would stop buying oil from Russia and close all its service stations there.[187]In April 2022, it emerged that Shell was to book up to $5 billion in impairment charges from exiting its interests in Russia.[188]

Singapore

[edit]

Singaporeis the main centre for Shell's petrochemical operations in theAsia Pacific region.Shell Eastern Petroleum limited (SEPL) have their refinery located in Singapore'sPulau Bukomisland. They also operate as Shell Chemicals Seraya inJurong Island.[189]In November 2020, Shell announced that, as part of efforts to curtail pollution emissions, it will cut its oil-processing capacity in Singapore.[190]

United Kingdom

[edit]

In the UK sector of theNorth SeaShell employs around 4,500 staff in Scotland as well as an additional 1,000 service contractors: however in August 2014 it announced it was laying off 250 of them, mainly inAberdeen.[191]Shell paid no UK taxes on its North Sea operations over the period 2018 to 2021.[192]

Alternative energy

[edit]
Brunei Shell Petroleum's flagship solar plant inPanaga,2021

In the early 2000s Shell moved intoalternative energyand there is now an embryonic "Renewables"business that has made investments insolar power,wind power,hydrogen,andforestry.The forestry business went the way of nuclear, coal, metals and electricity generation, and was disposed of in 2003. In 2006 Shell paidSolarWorldto take over its entire solar business[193]and in 2008, the company withdrew from theLondon Arraywhich when built was the world's largest offshore wind farm.[194]

Shell also is involved in large-scale hydrogen projects. HydrogenForecast.com describes Shell's approach thus far as consisting of "baby steps", but with an underlying message of "extreme optimism".[195]In 2015, the company announced plans to install hydrogen fuel pumps across Germany, planning on having 400 locations in operation by 2023.[196]

Shell holds 44% ofRaízen,a joint venture with Brazilian sugarcane producerCosanwhich is the third-largest Brazil-based energy company by revenues and a major producer ofethanol.[16]In 2015, the company partnered with Brazilian start-up company Insolar to install solar panels inRio de Janeiroto deliver electricity to theSanta Martaneighbourhood.[197]

Shell is the operator and major shareholder of TheShell CanadaQuest Energy project, based within the Athabasca Oil Sands Project, located nearFort McMurray,Alberta.[198]It holds a 60% share, alongsideChevron Canada Limited,which holds 20%, and Marathon Canadian Oil Sands Holding Limited, which holds the final 20%.[199]Commercial operations launched in November 2015. It was the world's first commercial-scale oil and sandcarbon capture storage (CCS)project.[198]It is expected to reduce CO2emissions in Canada by 1.08 million tonnes per year.[200]

In December 2016, Shell won the auction for the 700 MWBorssele III & IVoffshore wind farmsat a price of 5.45c/kWh, beating 6 otherconsortia.[201]In June 2018, it was announced that the company and its co-investorPartners Grouphad secured $1.5bn for the project, which also involvesEneco,Van Oord,and Mitsubishi/DGE.[202]

Shell Recharge rapid charger in the Cirencester Waitrose car park, 2023

In October 2017, it bought Europe's biggest vehicle charging network, "NewMotion".[203]

In November 2017, Shell's CEO Ben van Beurden announced Shell's plan to cut half of its carbon emissions by 2050, and 20 percent by 2035. In this regard, Shell promised to spend $2 billion annually on renewable energy sources. Shell began to develop its wind energy segment in 2001, the company now operates six wind farms in the United States and is part of a plan to build two offshore wind farms in the Netherlands.[204]

In December 2017, the company announced plans to buy UK household energy and broadband providerFirst Utility.[205]In March 2019 it rebranded toShell Energyand announced that all electricity would be supplied from renewable sources.[206]

In December 2018, the company announced that it had partnered with SkyNRG to begin supplyingsustainable aviation fuelto airlines operating out ofSan Francisco Airport (SFO),includingKLM,SAS,andFinnair.[207][208]In the same month, the company announced plans to double its renewable energy budget to investment in low-carbon energy to $4 billion US each year, with an aim to spend up to $2 billion US on renewable energy by 2021.[209]

In January 2018, the company acquired a 44% interest in Silicon Ranch, a solar energy company run byMatt Kisber,as part of its global New Energies project.[210]The company took over from Partners Group, paying up to an estimated $217 million for the minority interest.[211]

In February 2019, the company acquired German solar battery companySonnen.[212]It first invested in the company in May 2018 as part of its New Energies project.[213]As of late 2021, the company had 800 employees and has installed 70.000 home battery systems.[214]

On 27 February 2019, the company acquired British VPP operator Limejump for an undisclosed amount.[215]

In July 2019, Shell installed their first 150 kW electric car chargers at its Londonpetrol stationswith payments handled viaSMOOV.They also plan to provide 350 kW chargers in Europe by entering into an agreement withIONITY.[216]

On 26 January 2021, Shell said it would buy 100 per cent of Ubitricity, owner of the largest public charging network forelectric vehicles in the United Kingdom,as the company expands its presence along the power supply chain.[217]In 2023, Shell announced that it would rebrand its Ubitricity chargepoints under its Shell Recharge brand.[218]

On 25 February 2021, Shell announced the acquisition of German Virtual Power Plant (VPP) company Next Kraftwerke for an undisclosed amount. Next Kraftwerke connects renewable electricity generation- and storage projects to optimize the usage of those assets. The company mostly operates in Europe.[219]

In November 2022, it was announced Shell's wholly-owned subsidiary, Shell Petroleum NV, had acquired theOdense-headquarteredrenewable natural gasproducer, Nature Energy Biogas A/S for nearly $2 billion USD.[220]

Ownership

[edit]

Shell is mainly owned by institutional investors. The 10 largest shareholder of Shell plc. in early 2024 were:[95]

Controversies

[edit]
Presentation of Shell Oil Company contribution to National Fish and Wildlife Foundation at the Foundation's Celebrating the Great Outdoors fundraising event, 2005

Carbon capture storage beneath the sea bed

[edit]

In 2020, theNorthern Lights CCS projectwas announced, which is a joint project between Equinor, Shell and Total, operating in the European Union (Norway) and aiming to store liquid CO2beneath the seabed.[221][222][223][224]

Processing oil in the Amazon

[edit]

Environmentalists have expressed concern that Shell is processing oil from theAmazon regionofSouth America.In the United States, the Martinez refinery (CA) and the Puget Sound Refinery (WA) carry Amazonian oil. In 2015, 14% of the Martinez refinery's gross, at 19,570 barrels per day, came from the Amazon.[225]

Operating in the hump back whale breeding grounds

[edit]

In December 2021, Royal Dutch Shell decided to move ahead with seismic tests to explore for oil inhumpback whalebreeding grounds along South Africa's eastern coastline.[226]On 3 December 2021, a South African high court struck down an urgent application brought by environmentalists to stop the project, which will involve a vessel regularly firing an air gun that produces a very powerful shock wave underwater to help map subsea geology. According to Greenpeace Africa and the South African Deep Sea Angling Association, this could cause "irreparable harm" to the marine environment, especially to migrating humpback whales in the area.[227]

Climate change

[edit]

Measured by both its own emissions, and the emissions of all the fossil fuels it sells, Shell was theninth-largest corporate producer of greenhouse gas emissionsin the period 1988–2015.[228]The burning of the fossil fuels produced by Shell are responsible for 1.67% of global industrialgreenhouse gas emissionsfrom 1988 to 2015.[229]

In the past, Shell has been a part of lobbying and trade groups that are against climate policy and promote climate skepticism.[230]

In 2017, a public information film ( "Climate of Concern" ) unseen for years resurfaced and showed Shell had clear grasp of global warming 26 years earlier but has not acted accordingly since, said critics.[231][232][233]During the years of 2010-2018, only 1% of Shell's long term investments were dedicated to sources of low-carbon energy such as wind and solar. In the years of 2015-2017, just 0.4% of its revenue was put towards low-carbon technology.[234]

Shell failed to meet its own target in 2020 to spend $6 billion on renewable energy. It is also estimated that Shell is not on track to meet its own investment target for 2025, and that the company needs to direct over half of its capital expenditures (nearly $10 billion per year) to zero carbon investments in order to meet its long-term net-zero targets.[234]In April 2020, Shell announced plans to achievenet zero greenhouse gas emissionsby 2050 or sooner.[235]They also pledged to reduce carbon intensity of all energy products by 20% by 2030, and 45% by 2035 (compared to 2016 levels.)[236]However, internal documents from the company released by the Democratic-led House committee reveal a private 2020 communication saying Shell does not have any plans to bring emissions to zero for next 10–20 years.[237]

In March 2024, Shell CEO Wael Sawan announced that the company would moderate its near-term carbon emissions reduction targets, revising its reduction innet carbon intensityof third-party use of products down to 15% from 20% and dropping its target of a 45% reduction in carbon emissions by 2035 from a 2016 baseline.[238][239]

Litigation

[edit]

On 5 April 2019,Milieudefensie(Dutchfor "environmental defense" ), together with six NGOs and more than 17,000 citizens, sued Shell, accusing the company of harming the climate despite knowing about global warming since 1986.[240][241]In May 2021, the district court ofThe Hagueruled that Shell must reducecarbon dioxide emissionsby 45% by 2030 (compared to 2019 levels).[242]

Oil spills

[edit]
  • Shell was responsible for around 21,000 gallons of oil spilled nearTracy, California,in May 2016 due to a pipeline crack.[243]
  • Shell was responsible for an 88,200-gallon oil spill in the Gulf of Mexico in May 2016.[244]
  • Two ruptures in a Shell Oil Co. pipeline inAltamont, California– one in September 2015 and another in May 2016 – led to questions on whether the Office of the State Fire Marshal, charged with overseeing the pipeline, was doing an adequate job.[245]
  • On 29 January 2021, a Dutch court ordered Royal Dutch Shell plc's Nigerian unit to compensate for oil spills in two villages over 13 years ago. Shell Nigeria is liable for damages from pipeline leaks in the villages of Oruma and Goi, the Hague Court of Appeals said in a ruling. Shell said that it should not be liable, as the spills were the result of sabotage.[246]

Accusations of greenwashing

[edit]
Shell former world headquarters inHaagse Hout, The Hague

On 2 September 2002, Shell Chairman Philip Watts accepted the "Greenwash Lifetime Achievement Award" from the Greenwash Academy's Oscar Green, near the World Summit on Sustainable Development.[247]

In 2007, BritishASAruled against a Shell ad involving chimneys spewing flowers, which depicted Shell's waste management policies, claiming it was misleading the public about Shell's environmental impact.[248][249]

In 2008, the British ASA ruled that Shell had misled the public in an advertisement when it claimed that a $10 billionoil sandsproject inAlberta,Canada,was a "sustainable energy source".[250][251]

In 2021,Netherlandsofficials told Shell to stop running a campaign which claimed customers could turn their fuel "carbon neutral" by buying offsets, as it was concluded that this claim was devoid of evidence.[252][253]

In December 2022,U.S. House Oversight and Reform CommitteeChairCarolyn MaloneyandU.S. House Oversight Environment SubcommitteeChairRo Khannasent a memorandum to all House Oversight and Reform Committee members summarizing additional findings from the Committee's investigation into the fossil fuel industry disinformation campaign to obscure the role of fossil fuels in causing global warming, and that upon reviewing internal company documents, accused Shell along withBP,Chevron Corporation,andExxonMobilofgreenwashingtheirParis Agreementcarbon neutralitypledges while continuing long-term investment in fossil fuel production and sales, for engaging in a campaign to promote the use of natural gas as a clean energy source and bridge fuel to renewable energy, and of intimidating journalists reporting about the companies' climate actions and of obstructing the Committee's investigation, which ExxonMobil, Shell, and theAmerican Petroleum Institutedenied.[254][255][256]

Contesting ruling by The Hague court

[edit]

Shell contested a 2021 ruling by The Hague court requiring it to reduce emissions by 45% by 2030. The case, driven by Milieudefensie, argued Shell must align with climate agreements, while Shell contended the ruling exceeded judicial authority and could lead to counterproductive outcomes. The outcome was anticipated to significantly impact Shell's operations and influence European energy companies' climate policies.[257]

Health and safety

[edit]

A number of incidents over the years led to criticism of Shell'shealth and safetyrecord, including repeated warnings by theUK Health and Safety Executiveabout the poor state of the company's North Sea platforms.[258]

Reaction to the Russian invasion of Ukraine

[edit]

Shell already had previous experience exiting markets that were subject to sanctions pressure from NATO or EU member states. In particular, in 2013, Shell announced that it was suspending its operations in Syria.[259]On 8 March 2022, Shell announced its intention to phase out all Russian hydrocarbon production and acquisition projects, including crude oil, petroleum products, natural gas and liquefied natural gas (LNG). In early 2022, the company was criticized by the Minister of Foreign Affairs of Ukraine for its slow response to the Russian invasion.[260]As of April 2023, Shell still had shares in Russian companies, such as 27.5% in Sakhalin Energy Investment Company (SEIC), a joint venture with Gazprom (50%), Mitsui (12.5%) and Mitsubishi (10%).[261]

royaldutchshellplc.com

[edit]

This domain name was first registered by a former marketing manager for Royal Dutch Shell plc, Alfred Donovan, and has been used as a "gripe site".[262]It avoids being an illegalcybersquatteras long as it is non-commercial, active, and no attempt is made to sell the domain name, as determined byWIPOproceedings.[263]In 2005, Donovan said he would relinquish the site to Shell after it "gets rid of all the management he deems responsible for its various recent woes".[264]The site has been recognized by several media outlets for its role as anInternet leak.In 2008, theFinancial Timespublished an article based on a letter published by royaldutchshellplc.com,[265]whichReutersandThe Timesalso covered shortly thereafter.[266][267]On 18 October 2006, the site published an article stating that Shell had for some time been supplying information to the Russian government relating toSakhalin II.[268]The Russian energy companyGazpromsubsequently obtained a 50% stake in the Sakhalin-II project.[269]Other instances where the site has acted as an Internet leak include a 2007IToutsourcing plan,[270]as well as a 2008 internal memo where CEOJeroen van der Veerexpressed disappointment in the company's share-price performance.[271]

The gripe site has also been recognized as a source of information regarding Shell by several news sources. In the 2006Fortune Global 500rankings, in which Royal Dutch Shell placed third, royaldutchshellplc.com was listed alongside shell.com as a source of information.[272]In 2007, the site was described as "a hub for activists and disgruntled former employees".[273]A 2009 article called royaldutchshellplc.com "the world's most effective adversarial Web site".[274]The site has been described as "an open wound for Shell".[268]

See also

[edit]

Notes

[edit]
  1. ^Data is based on the 2022Fortune 500.

References

[edit]
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Bibliography

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Commissioned works

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(In chronological order)

Other works

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