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Shell picks gas veteran Sawan as CEO to lead transition

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  • Van Beurden will stop at the end of 2022, will leave the group next year
  • Sawan heads Shell’s integrated gas division, renewables
  • Sawan was seen as a leader to replace Van Beurden

Sept 15 (Reuters) – Shell (SHEL.L) has turned to the head of its gas and renewable energy businesses to drive the transition to a low-carbon future, choosing Wael Sawan to replace Ben van Beurden as chief executive.

Sawan’s appointment comes at a pivotal time for the oil giant, which aims to cut emissions to zero by 2050 and move away from fossil fuels, even as Europe looks to fossil fuels to survive a growing energy crisis. .

Lebanese-Canadian Sawan, 48, was seen as the frontrunner to replace Van Beurden, who will step down at the end of the year after nearly a decade at the helm and 40 years at Shell, the world’s largest fuel retailer and liquefied natural gas (LNG ) trader. read more

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During his tenure, Van Beurden oversaw Shell’s largest acquisition in decades, guiding the company through two major recessions and a crucial step to reduce greenhouse gas emissions – a task that will only become more important for his successor.

Shell lost a landmark case brought by climate activists last year when a Dutch court ordered it to cut emissions faster – a ruling the company has appealed. read more

While Shell’s strategy during the energy transition is focused on delivering low-carbon fuel and power to customers, current spending is still heavily focused on oil and gas.

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“He has to say that Shell will massively shift capital spending towards renewable energy in the near term,” Greenpeace said.

Sawan previously led Shell’s oil and gas production operations and now oversees the low-carbon energy and giant gas operations.

Credit Suisse analysts said he was well known to investors and expected his appointment to have a limited impact on Shell’s strategy. Credit Suisse Asset Management is a top five shareholder of Shell.

“The shift is likely more of a continuation than a revolution in Van Beurden’s strategy,” analysts at RBC Capital said.

DIVIDENDS AND RENEWABLE GOODS

Dutchman van Beurden, who joined Shell in 1983 and became CEO in January 2014, will remain as an advisor to the board and will leave the company at the end of June next year.

The 64-year-old has recently focused on the move of Shell’s headquarters from The Hague to London, as well as the energy crisis that has gripped the world following the Russian invasion of Ukraine in February.

After the coronavirus pandemic and the collapse in energy demand in early 2020, Shell cut its dividend for the first time since World War II, the largest in the world at the time by about $15 billion.

But in July, the company posted record results, with a second-quarter profit of $11.5 billion that broke the level three months earlier. read more

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“Investors will be looking for guarantees about dividend security and renewable strategy,” said Hargreaves Lansdown analyst Sophie Lund-Yates.

Shell’s London-listed shares, which have appreciated more than 44% so far this year, rose slightly early in trading.

Sawan’s appointment will take effect on January 1.

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Reporting by Yadarisa Shabong, Pushkala Aripaka, Muhammed Husain in Bengaluru and Shadia Nasralla in London; adaptation by Mark Potter and Jason Neely

Our Standards: The Thomson Reuters Trust Principles.

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