Third Point blasts Shell’s efforts to walk the green tightrope

Third Point blasts Shell’s efforts to walk the green tightrope

Trust us to ride two horses at once, say the big western energy companies. We will drill enough oil and natural gas to keep the lights on while shovelling the profits into renewables and electric vehicle charging stations to save the planet at the same time.

Shell, TotalEnergies and BP have all been touting more or less aggressive versions of this strategy for a while. Similar lines have also started to appear at ExxonMobil and Chevron amid pressure from climate activists.

Now Third Point is calling them out. Last week, the activist hedge fund run by Dan Loeb took aim at Shell, arguing that it should break itself up into a legacy oil and chemicals business and a green arm focused firmly on the future.

Legacy Shell would drill the oil it already has while handing most of its free cash back to investors. Future Shell wouldn’t be entirely green: it would use the existing natural gasfields to fund investment in renewables and its service stations.

“You can’t be all things to all people,” is how Third Point puts it. It argues that future Shell would attract growth-oriented investors who value environmental, social and governance factors, while legacy Shell would be optimised for those