MOSCOW (MRC) -- Shell plans to restructure the way it runs its hydrocarbons and renewables businesses as part of changes being made under new chief executive Wael Sawan to improve performance and bring the company’s low-carbon initiatives into a single division, said the Financial Times.
The moves, which include splitting Shell’s integrated gas, renewables and energy solutions division, represent the second internal restructuring at the company in three years as it seeks to navigate the energy transition.
The gas business, which includes the world’s largest liquefied natural gas trading operation, will be combined with the company’s oilfields in a new Integrated Gas and Upstream division, headed by current upstream director Zoe Yujnovich.
The renewables and energy solutions business, which includes Shell’s wind and solar projects, will be combined with the oil refining and marketing units to create a new downstream and renewables division led by current downstream director Huibert Vigeveno.
The combination of renewables and downstream, which already included Shell’s electric vehicle charging business and work on biofuels, will bring all of the company’s low-carbon investments into one area.
Europe’s largest energy company is set to announce record annual results on Thursday after a bumper year driven by soaring prices for oil and gas resulting from the disruption unleashed by Russia’s assault on Ukraine.
“I’m making these changes as part of Shell’s natural, and continuous, evolution,” Sawan said in a statement on Monday. “I believe that fewer interfaces mean greater co-operation, discipline and speed, enabling us to focus on strengthening performance across the businesses and generating strong returns for our investors."
After heading the upstream division, Sawan headed integrated gas and renewables for a year before taking over as chief executive at the start of January.
The changes, which take effect on July 1, also mean the number of people on Shell’s executive committee will shrink from nine to seven, with Ed Daniels’s role as director of strategy, sustainability and corporate relations discontinued.
From July, chief financial officer Sinead Gorman will oversee strategy and sustainability, while the corporate relations team will report to Sawan. Daniels will leave Shell after more than 34 years at the company, it said.
The appointments represent the first big reshuffle of personnel since Sawan’s appointment. However, the impact on the direction of the company will depend on how the changes on the executive committee cascade through the rest of the business in the second half of the year.
Shell said it did not expect major job losses as a result of the overhaul but that some cuts were “possible” if newly combined functions were streamlined. As part of the 2020 restructuring, known as Project Reshape, Shell planned up to 9,000 job cuts from its global workforce by the end of 2022.
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