Shell (NYSE:SHEL) said Thursday it plans to keep investment steady in its renewables business this year after reaching an all-time high in 2022, with a renewed focus on delivering value to shareholders.
"Our philosophy has been a real pivot toward energy transition investments, but we will make sure that those investments go into the areas where we can see line of sight toward attractive returns to be able to reward our shareholders," new CEO Wael Sawan said after the company reported its second-highest ever quarterly earnings.
Shell invested ~$3.5B on the renewables and energy solutions business last year, comprising 14% of total capital spending, a level that will remain steady in 2023, CFO Sinead Gorman said.
Overall, Sawan said Shell's (SHEL) spending on energy transition is greater than the figures included in the renewables unit, making up more than a third of overall capex of $23B-$27B announced for 2023.
The CEO also told Bloomberg that Shell's (SHEL) natural gas business can continue to grow "in a world that is desperately in need of natural gas at the moment, and I think for a long time to come," adding gas "has a critical role to play in the transition" to lower-carbon energy.
There's no sign the tight energy market that helped deliver bumper profits for the company last year will ease, Sawan said.
Shell's (SHEL) liquefied natural gas business boomed last year as Europe was forced to pivot away from cut-off Russian supplies of the fuel; its integrated gas business generated nearly two-thirds of the company's Q4 profit.