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Shell pulling out of all Russian hydrocarbons
Following its recent announcement to exit the Nord Stream 2 pipeline project and equity partnerships with Gazprom, Shell now plans to conduct a phased withdrawal from its involvement in all Russian hydrocarbons, including crude oil, petroleum products, gas and LNG
As an immediate first step, Shell will stop all spot purchases of Russian crude oil. It will also shut its service stations, aviation fuels and lubricants operations in Russia.
“We are acutely aware that our decision last week to purchase a cargo of Russian crude oil to be refined into products like petrol and diesel – despite being made with security of supplies at the forefront of our thinking – was not the right one and we are sorry,” said Shell chief executive Ben van Beurden.
“As we have already said, we will commit profits from the limited, remaining amounts of Russian oil we will process to a dedicated fund. We will work with aid partners and humanitarian agencies over the coming days and weeks to determine where the monies from this fund are best placed to alleviate the terrible consequences that this war is having on the people of Ukraine,” added Mr van Beurden.
As part of its efforts to “disentangle” from Russian energy, Mr van Beurden, said Shell will stop buying Russian crude oil on the spot market and not renew term contracts. It will remove Russian volumes from its crude oil supply chain.
Shell will begin a “phased withdrawal” from Russian petroleum products, pipeline gas and LNG. “This is a complex challenge. Changing this part of the energy system will require concerted action by governments, energy suppliers and customers, and a transition to other energy supplies will take much longer,” said Mr van Beurden.
This latest announcement follow’s Shell’s decision on 28 February that it intends to end its involvement in the Nord Stream 2 pipeline project and exit its equity partnerships with Gazprom and related entities, including its 27.5% stake in the Sakhalin-II LNG facility, its 50% stake in the Salym Petroleum Development and the Gydan energy venture.
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