Anglo-Dutch Shell will make decisions on investments in different types of energy resources depending on their profitability and compliance with the goals of the energy transition, said the new head of the company Vael Savan during the communication with investors.

He emphasized that Shell plans to allocate a third of its investments to renewable and clean energy, with a balanced strategy: “We are looking at how to create value for the company’s shareholders and how to create opportunities for 2040, when the energy system will be very different.”

Savan expressed confidence that both oil, gas and renewables will be needed in 2040.

“I like the fact that we have the largest gas production portfolio in the world, with 70% of our contracts indexed to the Brent oil price. I want to continue to grow that part of the business,” the top executive said, noting that dependence on the Brent oil price will be important for the company.

He noted that the company already has little presence in the European upstream sector, with its assets in the US, Brazil, as well as Kazakhstan, Oman, Brunei and Malaysia being the main focus of such assets.

“We see Europe more as an area for energy transition (RES and green hydrogen – IF),” Savan said, noting that investments in Europe are also directed to the retail sector – fuel distribution.

He stressed that the investment climate should be attractive and stable, but 2022 did not demonstrate this, listing the introduction of a windfall tax, a price cap, and “some nationalization”.

“Of course I understand conditions are extreme, but you try to manage risk, you try to manage prices, you need to do that for long-term investment,” the Shell chief said.

“In terms of low-carbon energy, let me be categorical – we will aim for high profitability in any business we are going to invest in. (…) Our shareholders deserve to see strong results. If we don’t see double-digit profitability, we have to question whether it’s worth continuing. Of course we are going to invest in low-carbon energy, but it has to be profitable,” Savan said, noting that the company intends to pursue integrated projects