Sector News

Shell plans to move HQ to UK

November 21, 2021
Chemical Value Chain

Royal Dutch Shell (“Shell”) plans to move its headquarters to the UK as it seeks to simplify its structure – a move it says will help accelerate its push to become net zero.

Shell has been incorporated in the UK with Dutch tax residence and dual share structure since 2005. Under its new proposal, which shareholders will vote on in December, it will move its tax residence from the Netherlands to the UK, adopt a single share structure that will increase the amount of cash it can return to shareholders, and drop “Royal Dutch” from its name and simply be called Shell.

The company said the changes will make the business more agile when it comes to decision-making, with Chairman Sir Andrew Mackenzie noting: “At a time of unprecedented change for the industry, it’s even more important that we have an increased ability to accelerate the transition to a lower-carbon global energy system. A simpler structure will enable Shell to speed up the delivery of its [net zero] strategy, while creating value for our shareholders, customers and wider society.”

The move follows calls in October from activist investor Third Point for Shell to simplify its structure and carve itself up into standalone companies with one responsible for its legacy upstream, refining and chemicals businesses and a second for its LNG and renewables businesses.

Shell’s proposal has been welcomed by UK Energy Secretary Kwasi Kwarteng as “vote of confidence in the British economy”. But has met fierce opposition in the Netherlands where politicians have proposed implementing an exit tax that would penalise the company for leaving the country. Ahead of the backlash, Shell made a point of noting that it will continue to be a significant employer with a major presence in the Netherlands. It said its Projects and Technology division, global Upstream and Integrated Gas businesses and renewable energies hub will remain located in The Hague. It also pointed to recent decisions to build a 820,000 t/y biofuels plant at its Energy and Chemicals Park in Rotterdam, plans to build Europe’s biggest electrolyser in Rotterdam, and its intention to take part in the Porthos CCS project.

Shell has faced friction in the Netherlands of late with the government ordering that Groningen gas field be shut down due to seismic activity, and a Dutch court ordering Shell to accelerate its emissions reduction. Shell is appealing the landmark ruling but has noted that its proposed “simplification will have no impact on legal proceedings relating to the climate ruling issued by the District Court in The Hague in May 2021 or any other legal proceedings currently in progress”.

The company’s shared UK and Dutch heritage is a result of the merger in 1907 of the Royal Dutch Petroleum Company and the UK’s Shell Transport and Trading Company.

by Adam Duckett

Source: thechemicalengineer.com

comments closed

Related News

May 15, 2022

New York’s EPR and packaging reduction bills lauded as game-changers in plastic pollution battle

Chemical Value Chain

The US State of New York is introducing two new bills to combat over-packaging, poor recycling rates and litter issues, including an Extended Producer Responsibility (EPR) program requiring companies such as McDonald’s and Amazon to pay for the cost of packaging disposal and recycling.

May 15, 2022

Borealis and Reclay launch entity focused on lightweight packaging 

Chemical Value Chain

The new organization’s mission is to redesign the critical steps of the plastics sorting and recycling system for post-consumer lightweight packaging (LWP) to speed up circularity, born from a need to meet the rising market demand for high-quality recyclates for use in high-end plastic applications.

May 15, 2022

Starbucks and Hubbub launch reusable packaging fund as COVID-19 diminishes consumer appetite

Chemical Value Chain

Starbucks and Hubbub have launched a £1 million (US$1.22 million) “Bring It Back Fund” to increase the uptake of reusable packaging in the F&B industry. The funding will go toward innovative ideas that make it easier for customers to use alternatives to single-use packaging by supporting pilot projects that help shift consumption habits.