Anglo-Dutch Shell is considering spending high oil and gas revenues to buy an enormous renewable energy (RES) business or buy back its own shares, CEO Ben van Beurden told the Financial Times.
Instead of building a collection of wind or solar farms in the hope of selling the energy it produces, Shell’s approach is to provide every customer with the low-carbon solutions they need, he says.
One way to boost Shell’s energy transition strategy now is to buy the significant renewable energy business with cash from skyrocketing oil and gas prices, the newspaper writes.
But, according to van Beurden, a deal of such magnitude and influence as the takeover of BG (a major player in the LNG market – IF) will be difficult. “I deliberately refrained from doing big things in this area to make sure we know how their business works in the first place,” he said.
There is speculation in the industry that Shell could buy Danish energy company Orsted or Germany’s renewable-focused RWE.
While van Beurden said both of those deals were unlikely, he added that Orsted, in particular, fell short of Shell’s customer-focused plans.
“I would be more inclined to think of RWE with a customer base than Orsted with a collection of wind farms,” he added.
He said that Shell prefers to acquire mid-sized energy companies for about $1 billion. In April, he bought Indian renewable energy group Sprng Energy from Actis for $1.55 billion.