Shell to change with the times
Firm targets vehicle recharging stations and low-carbon fuels
Royal Dutch Shell aims to expand marketing operations in Asia and wants 20% of sales from its fuel stations worldwide to come from recharging electric vehicles and low-carbon fuels by 2025, as the world shifts away from crude.
The Anglo-Dutch firm, with 43,000 fuel stations in 80 countries, aimed to expand in China and India, as well as Mexico, where it expected fossil fuel growth in the next decade, said John Abbott, the head of refining, trading and marketing.
But, he said Shell remained focused on a future in which demand for alternatives to petrol and diesel cars would rise.
“Shell will be part of leading the decarbonising of the energy system. We have to accept that is the way the world is going.”
He said Shell was “working back from the customer, which is very relevant as we go through the energy transition”.
Britain and France have said they will ban sales of new petrol and diesel vehicles by 2040, while China and India are considering such a step, putting pressure on Shell and its peers to show investors how they can make profits in a world consuming less fossil fuel.
Electric and hybrid-engine vehicles represent only a fraction of the world’s 1-billion car fleet now, but Shell forecasts it will account for about a quarter in 2040. Other fuels, such as hydrogen and natural gas, are also expected to become more popular as drivers seek lowerpolluting alternatives.
Abbott said Shell wanted about 20% of fuels offered at its forecourts by 2015 to be low- carbon intensity, including biofuels, battery recharging and liquefied natural gas, which can be used to power trucks.
Shell has launched pilot projects for vehicle recharging sta- tions in Britain, the Netherlands and California. It is also part of a scheme to develop hydrogen fuel stations in Germany.
Shell, which is betting on marketing to secure its revenues, planned to expand retail operations in China, India, Indonesia and also Mexico, where it opened its first fuel station in September, Abbott said.
BP has also increased its focus on retail, forming joint ventures with stores such as Marks and Spencer in Britain to attract customers to its fuel station forecourts.
A drop in oil prices in the past three years, during which a barrel of crude fell from above $100 to about $54 now, allowed Shell’s downstream activities to shine, partly because lower oil prices also mean cheaper petrol and diesel for drivers.