A historic year for Shell
Mar 2, 2016
Speech given by Ben van Beurden, Chief Executive Officer (CEO) at Shell, at Shell's Annual Reception 2016 in the National Gallery, London, UK on March 2, 2016.
Acquiring BG creates a springboard for making Shell fit for the future. Shell is using the acquisition, says Ben van Beurden, to create a simplified and more agile company that focuses on our core strengths. These strengths lie in the development of oil and gas fields in deep water, and integrated gas - especially liquefied natural gas. In the UK, Shell inherits several assets and projects in the North Sea. The UK clearly plays an important role in the future of the company, argues Van Beurden.
Your excellencies, distinguished guests, ladies and gentlemen,
A warm welcome to you all. It’s a pleasure to see so many old friends here at the National Gallery. Venus. Adonis. Mary Magdalene. And you, of course.
2016 is a historic year for Shell. But before I go into that, please allow me to say a few words about the year that’s behind us.
The sustained low oil prices made 2015 a challenging year, both for Shell and the energy industry as a whole. Our company has taken a number of steps to weather the storm. We’ve reduced costs, and kept our balance sheet – which compares what we own to what we owe – in good shape. We’ve sold assets, continued to deliver new projects, and - despite having to make significant savings - invested around 29 billion dollars in developments that will deliver returns for decades to come.
In other words: we’re prepared for 2016, which appears to be shaping up as an even more demanding year for our industry.
Alongside challenges, there were also some opportunities over the past year. The acquisition of BG, which we completed last month, was obviously the largest of these opportunities. Many of you have supported us in the process, for which I would like to thank you today.
The combination with BG bolsters our long-term strategy. The energy system is in transition. It’s moving to lower-carbon sources; the geopolitical and economic dynamics are shifting; and the demand for energy is expected to keep rising as a result of better living standards and the world’s growing population.
Shell intends to play its part in this energy transition, in co-operation with governments, NGOs, academia, and businesses. Acquiring BG, with its first-class portfolio, creates a springboard for making Shell fit for that future.
This is why I believe 2016 is a historic year for our company.
We’re using the acquisition to create a simplified, more agile company that focuses on our core strengths. These strengths lie in the development of oil and gas fields in deep water, and integrated gas ― especially liquefied natural gas, or LNG.
Here in the UK, Shell inherits several assets and projects in the North Sea. This is still an important region for the production of energy, despite the significant challenges it faces.
Shell and the UK
The UK clearly plays an important role in the future of Shell. Here, we enjoy an open business environment, with a vibrant, knowledgeable and influential community of academics, scientists, think tanks and NGOs.
In challenging times like these, Shell very much values the high calibre of British universities and the thought leadership of their academics, the expertise of UK-based NGOs, and the professionalism of British diplomats.
We also applaud the role of the UK in the making of the Paris agreement on climate change, and we welcome this country’s continuing engagement in world affairs. I’ll add that I hope that the UK will continue to see the value of being part of the European Union.
Investing in communities
Ladies and gentlemen, I believe that companies need to play their part in communities.
Here in the UK, Shell is doing this by investing in research; by providing a secure supply of energy from our North Sea operations; and by delivering the fuels to keep Britain on the move. But also through employment and investment which boost the UK economy; by contributing to the societal debate on energy; and by investing in the next generation with our STEM schools programmes.
Crucial to a succesful transition of the energy system is encouraging the next generation of scientists and innovators - the bright young minds who will create the ideas and the inventions.
This summer, Shell will be hosting “Make the Future London”, being held at the Queen Elizabeth Olympic Park. This festival will bring science and innovation to many students from across Europe. A key part of it will be the Shell Eco-marathon, which challenges teams of students to design, build and drive ultra-energy-efficient vehicles. On your way in, you may have seen one of these amazing cars in the foyer.
So, ladies and gentlemen, an interesting year lies ahead of us. Thank you for coming. I wish you all a pleasant evening, an evening among old friends.