Shell boss says listing could move to US

Wael Sawan said the environment is more 'supportive' to fossil fuel producers

Shell chief executive Wael Sawan. Reuters

The boss of Shell has said that the energy giant could shift to a New York listing and the more supportive environment of the US.

Wael Sawan said while the UK-based company has no plans to move its headquarters and listing to the US in the next three years, he has not ruled out the possibility.

In an interview with the BBC, he said the UK lacks stability on energy policy and taxation.

"When you do not have the stability you require in these long-term investments, that raises questions when we compare that to other countries where there is very clear support for those investments," he said.

He spoke about the “valuation gap” between Shell and American oil companies such as Exxon Mobil, which is worth 40 per cent more per dollar of profit.

"There are many who question whether that valuation gap can only be bridged if we move to the US. A move of headquarters is not a priority for the next three years."

"But after that? I would never rule out anything that could potentially create the right circumstances for the company and its shareholders. Ultimately, I am in the service of shareholder value," he said.

The company reported a record profit of $40 billion in 2022 as it benefited from higher energy prices caused by Russia's invasion of Ukraine last year.

In May the company reported a better-than-expected first-quarter profit based on strong performance in its fuel trading business, despite lower energy prices.

Shell's quarterly adjusted net profit increased about 6 per cent to $9.65 billion, from $9.13 billion a year earlier, exceeding the company’s own earnings forecast of $8 billion.

But in November, Shell said it was reviewing plans to invest £25 billion ($31.76 billion) in British projects after the UK government extended a windfall tax on energy companies.

The company said it would look at each of its projects on a “case-by-case basis” after Chancellor Jeremy Hunt raised the levy on oil and gas profits from 25 per cent to 35 per cent in his autumn statement.

Mr Sawan said Shell received a “warm welcome” from the New York Stock Exchange during a recent investors’ meeting.

"The welcome we had there was exemplary. The Shell flag was waving next to the New York Stock Exchange flag," he said.

And he suggested the US was more supportive of oil and gas companies.

"They said we continue to value a company that provides us the energy we desperately need. That resonated with me as a person who comes from Lebanon, where we are starved of energy,” he added.

Mr Sawan also warned that cutting oil and gas production would be “dangerous and irresponsible” because the renewable energy sector is not developing fast enough to replace it.

He dismissed a suggestion from the head of the UN, Antonio Gutteres, that investment in new oil and gas production would be “economic and moral madness”.

"What would be dangerous and irresponsible is cutting oil and gas production so that the cost of living, as we saw last year, starts to shoot up again,” he said.

Opposition leader Keir Starmer recently pledged to not rip up existing oil and gas licences as he unveiled a plan to make the UK a “clean energy super power” by 2030.

A Labour government will not grant any new oil and gas licences, he said. But it will honour all existing ones.

“Oil and gas will be part of the mix for decades to come under existing licences or licences that are granted in the near future,” he said.

“We are not going to interfere with existing licences. And that includes licences that are granted before we come into power.

“It is very important for investors who are going to invest in the UK to know that there is continuity if there is a change in government," Mr Starmer said.

“What we will do in the future is one thing. But how we will ensure continuity is another.”

Under Prime Minister Rishi Sunak the government has signalled support for new North Sea oil and gas exploration.