PRODUCING OIL AND GAS RESPONSIBLY AND EFFICIENTLY

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The most ambitious scenarios show that as the energy system evolves, the world will continue to need oil and gas for decades. Find out how Shell is focusing upstream business on fewer existing positions and on creating value rather than volume.

Oil and gas production

Oil and gas are vital to many aspects of modern life around the world, from powering transport and powering industry to heating homes and lighting schools. Shell’s Upstream business provides reliable power from shales, conventional oil and gas and deep water at an increasingly competitive price. The most ambitious scenarios show that even if the energy system evolves, the world will continue to need oil and gas for decades. We are focusing our Upstream portfolio to become more resilient, prioritizing value over volume to deliver the energy the world needs today while funding the energy system of tomorrow.

Our goal is to strike the right balance between managing our upstream assets, which will produce the financial returns needed to help fund the transition, and investing in our transition and growth businesses. Additionally, we are shifting capital from our Upstream business to our Transition and Growth businesses as the energy transition accelerates and we sell more low-carbon energy products. Our oil production peaked in 2019. Excluding the impact of Permian divestment, oil production is expected to decline by an average of 1-2% per year through 2030.

We also seek to reduce emissions from our facilities that produce natural gas by pursuing the operational efficiency of our assets, including reducing our methane emissions.

Deep water operations

Shell has a long history of developing energy projects using its knowledge, experience and proven deep-sea technologies to release energy resources safely and efficiently. Our global deepwater portfolio represents two key positions in our Upstream business with prolific basins in the United States and Brazil, as well as an exciting frontier exploration portfolio in Mexico, Suriname, Argentina and East Africa. West.

Seismic exploration

Shell is a responsible and leading operator and applies rigorous controls and international best practice guidelines to its operations. Procedures for managing the impact of seismic activities are well established and comply with the latest global industry standards.

Offshore seismic surveys are a safe mapping technique to gather information about the possible presence of oil or gas deep below the seabed in a given area using downward directed sound waves. The sound produced during seismic surveys is comparable to many natural and man-made ocean sounds, including wind and wave action, rainstorms, marine life, and shipping.

Shell has extensive experience collecting offshore data from these surveys and we take great care to prevent or minimize impacts on fish, marine mammals and other wildlife. Shell also contributes to joint industry programs, including the Sound and Marine Life Joint Industry Program, which is at the forefront of cutting-edge research into sound in the marine environment.

In 2021, questions and concerns have been raised about Shell’s activities in the ocean off the rugged coast of South Africa. Shell respects the court ruling issued on December 28, 2021 regarding the Wild Coast Inquiry and has suspended the investigation. We continue to examine the best way forward for our longer-term license to meet South Africa’s energy needs.

arctic regions

We do not plan to pursue any new oil exploration leases offshore the Arctic Circle. We are evaluating other opportunities on a case-by-case basis, consistent with our strategic objectives.

Shell ended offshore exploration drilling operations in Alaska in 2015. We hold interests in a small number of exploration licenses in the Arctic regions of the United States, Norway and Russia. We also hold a number of other licenses from our past operations in the Canadian Arctic, although we have no plans to develop these licenses further.

Shell holds interests in two license areas in Alaska’s former North Slope production area. In December 2020, Shell received regulatory approval to combine our coastal leases in West Harrison Bay into a single unit, which we expect to ultimately divest after the exploration phase. Shell is currently looking for a co-owner to operate the unit. The Nikaitchuq North prospect, in which Shell holds a 50% stake, is operated by ENI. Future plans are currently being evaluated.

Natural gas

We are a leading producer, distributor and marketer of liquefied natural gas (LNG). Piped natural gas and liquefied natural gas provide low-carbon energy. For example, switching from coal and oil to gas during the energy transition can help reduce emissions from electricity generation.

The IEA estimates that global natural gas operations have an average methane leakage rate of 1.7%. At this rate, natural gas emits approximately 45% fewer greenhouse gas emissions over its life cycle than coal when used to generate electricity.

Natural gas can also contribute significantly to reducing greenhouse gas emissions in industries such as the steel sector, where switching to natural gas from coal could lead to reduced emissions.

Gas also has significant advantages when used to generate electricity alongside renewables: it can quickly offset drops in supply from solar or wind generation and can respond quickly to increases in demand.

We are also looking to decarbonize our operations by pursuing operational efficiencies across our assets, including reducing our methane emissions and converting refineries into energy and chemical parks, so we can sell more low-carbon and sustainable products.

shales

We strive to release shale resources in a safe and responsible manner by strictly adhering to our onshore safety, air, water, footprint and community principles.

Source: www.shell.com


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