Oil Giant Shell at 'Inflection Point,' Says CEO

I'd start off by saying, actually, this is just an important point on the journey that we have been on, a journey that started over three years ago where we said we want to methodically transform the company, and that's what we've been doing. And so the inflection point came that as we continue to deliver performance discipline simplification in Shell, we felt that it was time to look at more and more capital reallocation, and we felt that we had earned the right to be able to grow. And so the announcement yesterday for ARC was essentially just a step in that journey that we have been on. We had been looking at ARC for over two years, and so that, of course, predated the Middle East crisis. I've particularly been attracted to multiple elements of ARC. I mean, first and foremost, this is a liquid rich play, high quality resource, low cost, long duration in a terrific basin like the Montney Basin with low carbon intensity molecules. And so we like that piece of it. We like the synergies, the adjacency to our own assets, and the integration into LNG Canada, our LNG project in Canada there. And then thirdly, we really like the people. We like the culture that they had developed over thirty years. And so this world predated the crisis, but, of course, always helpful to be able to have diverse sources of supply to meet the growing energy demands around the world.

Absolutely. So we had in the past guided to a 1% CAGR growth between now and 2030 for our oil and gas production. On the back of this deal, we have guided to a 4% per annum CAGR, so a significant growth uptick between 2025 and 2030. But importantly as well, it gives a long duration growth platform. It allows us to add a 150,000 barrels per day of liquids out in 2035, and the inventory we're talking about is well above fifteen years of inventory into up to twenty five years in certain areas. And so this is just an exciting growth platform that is underpinned in my mind with the liquids opportunity, but also with significant optionality for the gas through our existing plant and possibly through a second phase of that development that we have in LNG Canada.

Yeah. Difficult to call. I mean, very, very early days, and, of course, I'll leave it to The UAE leaders and to OPEC to opine on it. What I would say is, you know, OPEC is roughly a third of the overall liquids production of the world, and, undoubtedly, demand for liquids continues to grow. And I mean by that oil condensate and so on and so forth. The most important influence of OPEC has typically been in who has the spare capacity and how do they choose to deploy that spare capacity. And so that will be, I think, the calculus that will have to be made in the coming weeks, months, and years. For a company like ours, of course, our focus has been on indeed diversifying production. We have production in OPEC countries and non OPEC countries, but also importantly, continuing to make sure that we look at new horizons to be able to grow our production and that, of course, we do through both exploration and M&A, deals like what we've done, for example, here in Canada. And so I think at the end of the day, what will be important will be supply demand balances. We know that those are going to be tight for at least the coming months, if not at least the next year plus, given the closure on this in the straits. The question will be longer term, how does all that pan out? And I think that's too soon to call at the moment.