Shell Canada shifts its focus to green energy interests

Shell Canada Ltd. will soon announce a project to turn vegetable products into diesel fuel in Alberta, as part of the company’s transition to produce less oil and more energy from natural gas, renewables and chemicals.

This follows Shell’s massive US$7.25-billion divestment of its oilsands assets, announced March 9. The company still plans to build an LNG terminal in British Columbia, but no timeline has been set.

In an interview, Shell Canada president Michael Crothers said the company is working with an unnamed partner on the biodiesel project.

Shell would either sell the fuel directly to drivers or could blend it with diesel produced at the company’s existing refineries.

“You look at the new emerging policy that we expect on lowercarbon fuels and how we would manage a carbon-fuels standard and this could be an element to that,” Crothers said, referencing plans by the federal Liberal government on fuel emission targets.

Crothers said the project is one local example of how parent company Royal Dutch Shell plc is trying to transition its global portfolio to gas, renewables and petrochemicals following its US$50-billion acquisition of BG Group last year. He said the company’s projects in Canada will be part of that transition.

Shell divested the majority of its oilsands holdings in massive US$7.25-billion deal with Canadian Natural Resources Ltd. in March but became CNRL’s largest shareholder as part of the deal. “We’re holding those shares for value,” Crothers said.

“We don’t have a timeline but we will monetize them over time as we can create value for them.”

As part of its new focus in Canada, Crothers said Shell plans to bid on new renewable energy projects in Alberta, is working with auto-manufacturers on plans for a hydrogen fuel-cell network and last year expanded its Scotford refinery near Edmonton to produce more diesel.