GreenWire: A coalition of investors has forced the energy giant Royal Dutch Shell PLC to review its investments into carbon-heavy production in the oil sands of Canada at the firm’s annual meeting this spring.
Cooperative Asset Management and 141 other institutional and individual shareholders forced the resolution onto the agenda of Shell’s audit committee. The groups say the oil sands investments raise “concerns for the long-term success of the company arising from the risks associated with oil sands.”
“Given Shell’s level of commitment to oil sands, there is a greater obligation to shareholders to reassure how it would cope under a number of scenarios,” said Niall O’Shea, head of responsible investing at Cooperative Asset Management.
“What if carbon capture and storage proves too costly in the oil sands? What if sustained high oil prices and carbon regulation lead to switching away from marginal, high-cost, high-carbon sources? And then there’s the cost of cleaning up the locality. Companies must be more rigorous and transparent with their investors,” O’Shea added.
Shell, with its projects in Athabasca, has been one of the lead oil developers in Alberta, investments justified by the need to keep crude flowing, it says. The unconventional source represents less than 2.5 percent of its oil and gas production, it added in a formal response.
“The resolution is basically a request for further information around the economics and other aspects of our oil sands operations,” the firm said. “The resolution is submitted by shareholders representing some 0.15 percent of our total outstanding shares.”
The Anglo-Dutch giant will hold its annual meeting, the first for CEO Peter Voser, this May (Terry Macalister, London Guardian, Jan. 18). – PV