Shell plans to cut staff from its offshore wind business as part of a move by CEO Wael Sawan to shift the oil and gas giant away from a capital-intensive renewable energy sector.
According to reports Bloomberg, The British oil company will begin layoffs within a few months, mainly in Europe, according to people familiar with the matter who asked not to be identified because the information is private.
“We are focusing on select markets and segments to deliver the greatest value to our investors and customers,” a Shell spokesperson said. “Shell is looking at how to continue competing for offshore wind projects in priority markets, while maintaining our focus on performance, discipline and simplification.”
Shell had been spending heavily on offshore wind, aiming to leverage its experience in offshore oil and gas extraction to become a leader in that technology. But rising costs in the sector and a renewed focus on generating returns for shareholders under Sawan have led the company to move away from the green energy source.
Since Sawan took over as chief executive early last year, he has put pressure on business divisions to improve performance and profitability. In June 2023, he presented a plan to reduce “structural costs” by up to $3 billion by the end of 2025.
The cuts to offshore wind come after layoffs that began in the low-carbon solutions unit earlier this year.
Shell has formed a team focused on the Netherlands to develop and build offshore wind farms. But the company’s spending limits left a large team with less to do than previously expected.
The staff cuts follow the departure of several key executives in the offshore wind business, including Thomas Brostrom, head of its European renewable energy division, and Melissa Read, head of its UK offshore wind unit. United.
