In an effort to reduce costs overall, Shell plans to eliminate hundreds of positions from its oil and gas exploration division.
Chief Executive Wael Sawan intends to slash expenses by up to $3 billion by the end of 2025, including job cutbacks.
Shell To Cut Hundreds of Jobs in Oil and Exploration
About 20% of the employees in Shell’s divisions in charge of developing oil and gas discoveries and developing exploration strategies would be impacted by the layoffs.
While UK operations will be less impacted, offices across the globe are predicted to be impacted by the employment losses, with Houston and The Hague experiencing the worst repercussions.
A spokesperson for the company said, “Shell aims to create more value with less emissions by focusing on performance, discipline and simplification across the business. That includes delivering structural operating cost reductions of $2bn-$3bn by the end of 2025, as announced at our capital markets day event in June 2023. Achieving those reductions will require portfolio high grading, new efficiencies and a leaner overall organisation.”
Shell is concentrating on performance, discipline, and simplification throughout the entire company in an effort to generate greater value with fewer emissions.
The upstream segment of Shell, which generated more than a third of the business’s $28 billion in adjusted profits in 2017—includes the layoffs.
Shell To Increase Gas Output in Upcoming Years
Shell intends to increase its gas output in the upcoming years despite these reductions and cautions from climate scientists regarding the incompatibility of new gas and oil projects with curbing global warming.
As part of the same cost-cutting effort, Shell said earlier this year that it would be reducing employment in its low-carbon solutions division.
Climate activists and a few Shell staff members have expressed disapproval of these plans and encouraged the CEO not to reduce investments in renewable energy.
Sawan has given up on efforts to reduce oil production and instead concentrated on cost-cutting to boost profitability since assuming the CEO role in January 2023.
Shell has previously consolidated departments like legal and communications teams and slashed jobs in its wind and chemicals businesses.
Sawan recently said that the company had saved $1.7 billion in costs and pledged to continue streamlining the operations.
Shell now has a $170 billion market value, up 13% from a year ago.
