British energy giant Shell recorded the highest profit in its history in 2022 and announces massive redistributions to its shareholders, stoking calls for more taxes and criticism from environmental NGOs.
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Shell saw its group share net profit climb to $42.3 billion, more than doubling thanks to soaring hydrocarbon prices, driven by the rebound in post-pandemic demand and the drop in Russian exports after the pandemic. invasion of Ukraine by Moscow.
Shell’s spectacular results follow those of its American rivals. ExxonMobil reported record 2022 profit of $55.7 billion on Wednesday, and Chevron last week posted annual net profit more than doubled to $35.5 billion.
Shell’s adjusted net profit (i.e. excluding exceptional items), the ratio most followed by analysts, came to 39.9 billion dollars, despite an after-tax charge of 3.8 billion in 2022 linked to the phasing out of oil and gas activities in Russia.
These results “demonstrate the strength of Shell’s differentiated portfolio, as well as our ability to provide life-saving energy to our customers in a volatile world,” said new chief executive Wael Sawan, who replaced Ben van Beurden, in a statement. January 1st.
But environmental NGOs denounce these record profits and call for the oil giants to contribute more to the climate emergency.
“Shell is profiting from climate destruction and immense human suffering,” said Elena Polisano of Greenpeace UK in a statement, whose activists demonstrated Thursday outside the group’s headquarters in London.
The NGO also indicates that four of its activists have climbed on a Shell platform near the Canary Islands, and believes that world leaders “should force historic mega-polluters to feed” a fund “for losses and damage caused by the climate crisis. “.
“I am convinced that the world needs a balanced energy transition”, therefore without immediately doing without investments in fossil fuels, argued Mr. Sawan during an online press conference, indicating that a third of the group’s investments are focused on the energy transition.
“I don’t think we’re moving fast enough as a planet,” he admitted, however. But to do better, “it requires a significant change in government policies, good customer buy-in and, of course, companies like ours continuing to invest,” he said.
It is possible that Mr. Sawan, a former director of renewable energy at Shell, “gives extra attention to the transition” energy of the group, according to Richard Hunter, analyst of Interactive Investor.
But in the meantime “the renewable energy market is complicated” with “unproven or simply unprofitable technologies that make progress difficult”, continues the analyst, who notes that Shell is losing $ 1.06 billion for last year in this segment.
The British government introduced in May, then increased at the end of the year to 35%, a tax on exceptional energy profits, just like the EU which adopted a “temporary solidarity contribution” at the end of September.
Shell said in early January that it was planning a $2 billion slate for these one-off taxes in the fourth quarter, and said it was reviewing its investments in the UK as a result – a process still ongoing.
“We continue to believe in the significant potential for energy investment in the United Kingdom”, but such taxes are “destabilizing for an industry which invests to be able to make profits in 10, 15, 20 years”, he justified .
The oil and gas “major” is launching a $4 billion share buyback program on Thursday as well as a 15% increase in the dividend for the fourth quarter of last year.
In total, Shell is distributing $ 26 billion to its shareholders for 2022, making NGOs cringe, even if investors applaud, and the group’s action climbed 2.73% to 2,431 pence Thursday shortly before 12 noon GMT.
For the environmental NGO Friends of the Earth, taxation must be accelerated. It is ‘simply staggering’ to see such profits in the midst of the cost of living crisis, which sees ‘millions of people faced with the impossible choice of putting food on the table or heating their homes’.