British energy giant Shell is poised to reduce its workforce in its offshore wind division as CEO Wael Sawan shifts the company’s focus towards oil and gas, Bloomberg has reported.
The job cuts, mainly in Europe, are expected to commence within months.
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A Shell spokesperson stated: “We are concentrating on select markets and segments to deliver the most value for our investors and customers.
“Shell is looking at how it can continue to compete for offshore wind projects in priority markets while maintaining our focus on performance, discipline and simplification.”
The company, which had invested significantly in offshore wind to capitalise on its marine oil and gas extraction expertise, is now prioritising shareholder returns.
This strategic pivot comes amidst rising costs in the renewable sector and Sawan’s emphasis on business performance after becoming CEO.
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By GlobalDataIn June 2023, he announced a target of £3bn cuts in structural costs by the end of 2025.
The impending layoffs in the offshore wind department are part of these cost-reduction measures, following earlier job cuts in the low-carbon solutions unit.
Shell’s offshore wind team, primarily based in the Netherlands, now faces limitations on spending, leaving them with fewer projects than anticipated.
The planned staff reductions ‘coincide with the departure of several executives, including Thomas Brostrom and Melissa Read, leaders of the European and UK offshore wind units, respectively.
In May 2024 Shell also exited China’s power market, ceasing operations in power generation, trading and marketing.
The withdrawal aligns with the company’s strategy to focus on more lucrative ventures, especially in natural gas and oil.
In March 2024, Shell New Energies US sold its 50% interest in SouthCoast Wind Energy to Ocean Winds North America, its joint venture partner.
SouthCoast Wind was established to develop offshore wind projects in Massachusetts with a potential of 2.4GW.
