Shell raises dividend by a massive 15% as the oil giant’s new boss promises to return more money to investors
- Chief exec Wael Sawan plans to ‘create more value with fewer emissions’
- Oil giant promises again to become a zero-emission company by 2050
Shell is set to raise its dividend by 15 percent as part of the oil giant’s plans to return more cash to shareholders under new boss Wael Sawan.
As part of plans to “create more value with fewer emissions,” Shell told investors on Wednesday that the increase would come into effect from the second quarter of its fiscal year and that the group would implement share buyback programs of “at least” $ 5 billion (£4 billion) will start. half.
Shell CEO Wael Sawan
It includes ambitious cost-cutting plans, under which Shell will reduce capital expenditures to $22 billion to $25 billion per year for 2024 and 2025, and find $2 billion to $3 billion in annual operating cost savings by the end of 2025.
Total distributions to shareholders will increase from 20 to 30 percent of cash flow from operations to 30 to 40 percent.
Chief Executive Mr. Sawan, who was appointed in January, said: ‘We are investing to provide the secure energy customers need today and in the future, as we transform Shell to win in a low-carbon future.
“Performance, discipline and simplification will be our guiding principles in allocating capital to improve shareholder returns while enabling the energy transition.”
Shell also reiterated its commitment to be a net-zero emissions company by 2050.
The oil company has come under fire for the legitimacy of its green credentials since Sawan was appointed, with a UK regulator last week banning three Shell advertisements promoting its low-carbon products to potentially misleading customers.
Shell survived a shareholder revolt over its green strategy last month at a cramped annual meeting disrupted by climate change protesters.
But the company, which posted record earnings in the first quarter, said it was making “good progress” in this area by reducing emissions from its operations and from the fuels and other energy products it sells to customers.
It aims to reach near-zero methane emissions by 2030 and eliminate routine flaring from its upstream operations by 2025.
Shell will also invest $10 billion to $15 billion between 2023 and 2025 to support operations such as biofuels, hydrogen and electric vehicle charging.
Sawan said, “We must continue to create profitable business models that can scale quickly to make a real impact on decarbonising the global energy system.
“We will invest in the models that work, the highest return models that leverage our strengths.”