RDSB Royal Dutch Shell 'B'

   By Dieter Holger 
 

Royal Dutch Shell PLC (RDSA.LN) has set a short-term cardon-dioxide emissions target for the first time, the company said Thursday.

The oil giant said it aims to cut its net carbon footprint by up to 3% by 2021, compared with 2016, as it works toward meeting its goal of halving its greenhouse gas emissions by 2050.

"We are seeking cost-effective ways to manage GHG emissions and see potential business opportunities in developing such solutions," Shell said.

Shell's total GHG emissions fell in 2018 by 3.5% to 82.24 million metric tons of CO2 equivalent from 85.25 million in 2017, according to the company's annual report. Shell made emissions and other environmental metrics available for the last two years in the report.

The company's GHG intensity--a measure of emissions when compared to production--from refining and hydrocarbons fell by 7.9% and 4.8%, respectively, Shell said. However, GHG intensity for petrochemical production rose 1%.

In December 2018, Shell agreed to set short-term CO2 targets as part of its long-term carbon reduction ambitions, following pressure from Climate Action 100+, a group of environmentally conscious investors representing more than $32 trillion in assets under management. At the same time, Shell also said 10% of executives' remuneration would be linked to carbon reduction targets.

The company said in 2017 that it would start spending $2 billion a year to fight climate change and to achieve the goals of the Paris Climate Agreement of keeping global warming well below 2 degrees Celsius.

But Follow This, a group of more than 4,600 shareholders in oil companies including Shell, said the oil company's short-term targets and actions don't go far enough.

"Shell takes another step towards Paris, however, this will not get us to Paris," said Mark van Baal, founder of Follow This.

The International Panel on Climate Change has said there needs to be a 70% to 100% reduction in energy emissions by 2050 to meet the goals of the Paris agreement, but Shell is only achieving an absolute reduction in emissions of 30% by 2050 when factoring in the growing energy demand it anticipates in the coming years, Mr. van Baal said.

"While we are committed to reducing our GHG intensity, as energy demand increases and easily accessible oil and gas resources decline, we may develop resources that require more energy and advanced technologies to produce," Shell said. This could result in an increase in direct GHG emissions, it added.

"The oil and gas industry can make or break the Paris Climate Agreement," Mr. van Baal said.

Write to Dieter Holger at dieter.holger@dowjones.com; @dieterholger

(END) Dow Jones Newswires

March 14, 2019 12:57 ET (16:57 GMT)

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