Shell has announced that it will be replacing its current CEO, Ben van Beurden, with its head of gas and renewables, Wael Sawan.
The long-standing chief executive has filled the role for almost a decade and will step down at the end of the year after an almost 40-year career at the oil giant. His replacement will be Shell veteran Wael Sawan.
Sawan is a Lebanese-Canadian dual national, born in Beirut. The married father of three was born and raised in Dubai and attended Harvard Business School. He also received a Master’s degree in chemical engineering from McGill University, located in Canada.
Joining the oil company in 1997, Sawan has been a member of its executive committee since 2019. He has previously run several divisions, including oil and gas projects and its deepwater business based in Houston. Last year, he was appointed head of its integrated gas and renewables business.
Commenting on his appointment, Sawan said: “We will be disciplined and value focused, as we work with our customers and partners to deliver the reliable, affordable and cleaner energy the world needs.”
Shell’s Chair, Sir Andrew Mackenzie, called Sawan an “exceptional leader” claiming he had all the “qualities needed to drive Shell safely and profitably through its next phase of transition and growth.”
Van Burdens departure from the oil giant comes at a time when the industry faces one of the most severe energy crises in history, a situation that has led to record highs in oil and gas profits.
During a press conference in Norway on Monday, Van Beurden said that the current situation may persist for several years. He added, “It may well be that we will have a number of winters where we have to somehow find solutions.”
He went on to suggest these solutions would have to be found through “efficiency savings, through rationing and a very, very quick build out of alternatives”
Van Beurdens joined the company in 1983, and his departure ends an almost 40-year career. During his tenure, he oversaw one of the company’s biggest acquisitions in decades, the £36bn purchase of BG Group in 2016. This decision helped develop Shell’s gas and liquified natural gas business before many nations decided that gas would be their transition fuel between coal and greener alternatives. This created bumper profits for the group, which delighted shareholders but outraged activists.
After the landmark 2015 Paris climate agreement, van Beurden faced growing investor pressure to come up with a strategy to slash the company’s carbon emissions and shift to renewables.
After an initial push back, Shell has since 2017 set more ambitious goals to tackle global warming.
The companies most ambitious target is to reduce emissions to net-zero by 2050 with several short and medium-term targets, as well as plans to increase spending on renewable energy to 25% of its total spending by 2025.
Sawan will likely continue to face pressure from environmentalists and politicians to build on and implement these targets.
“For a group whose renewable strategy has been somewhat vague, though grand sounding, this is a clear marker that Shell intends to change this.” commented Sophie Lund-Yates, Lead Equity Analyst at Hargreaves Lansdown.
“Change won’t happen overnight, but it’s reasonable to think that at least tweaks to the existing renewable strategy could be on the cards.
“Investors will be looking to assurances on dividend security and renewable strategy first and foremost, and in that order.”
Charlie Kronick, climate campaigner for Greenpeace UK, says of Sawan: “He must state that Shell will massively shift capital expenditure to renewable energy in the short term. Without those clear commitments, Shell will continue to make the climate emergency even worse and remain part of the problem, not part of the solution.”
