The head of Shell has launched a stinging attack on increasingly vocal critics who are calling for fossil fuels to be left in the ground, accusing them of peddling naive and impractical solutions to climate change.
Ben van Beurden urged fellow industry leaders meeting in London to be “more assertive” in debates over the future of energy. But Shell’s chief executive admitted that the oil sector had its own credibility problem, enhanced by the fact that too many energy industrialists had been slow to acknowledge global warming.
In a speech to be delivered on Thursday night to the International Petroleum Week annual dinner, Van Beurden will warn his colleagues that they must be prepared for ever more intense public discussion about the role of fossil fuels in the runup to the UN climate change conference in Paris later this year.
“The outcome of the political process is uncertain, but the trends behind it are unmistakeable. Even more than the oil price, these trends will shape the future of the industry over the coming decades. For a sustainable energy future, we need a more balanced debate. ‘Fossil fuels out, renewables in’ – too often, that’s what it boils down to. Yet in my view, that’s simply naive,” he argues.
“Yes, climate change is real. And yes, renewables are an indispensable part of the future energy mix. But no, provoking a sudden death of fossil fuels isn’t a plausible plan,” he adds.
The Shell boss’s comments are likely to be welcomed by those political leaders who feel pressurised by environmentalists over the green agenda but they are likely to lead to criticism over the company’s own record, particularly with regard to its drilling in the Arctic and investments into carbon-heavy tar sands of Canada.
The comments from Van Beurden indicate that the oil industry is beginning to become rattled by those talking about a “carbon bubble” of oil and gas reserves that should be left in the ground, and moves by the Church of England and universities to remove their investments from the large oil and coal extractors.
The Dutchman was due to tell his audience that three billion people still lack access to the modern energy that many in the west take for granted. This is not just about having a television set, he will say, but about the difference between poverty and prosperity.
He will warn that demand is growing with more people on the planet, more people living in cities and more people rising out of poverty. “The issue is how to balance one moral obligation, energy access for all, against the other: fighting climate change. We still need fossil fuels for a lower carbon, higher energy future,” he argues.
The debate over climate change is being run by forces opposed to the fossil fuel industry so that it is unbalanced and this needs to be addressed by the oil companies becoming more involved, argues van Beurden.
“Our industry should be less aloof, more assertive. We have to make sure that our voice is heard by members of government, by civil society and the general public. I’m well aware that the industry’s credibility is an issue. Stereotypes that fail to see the benefits our industry brings to the world are short-sighted. But we must also take a critical look at ourselves.
“You cannot talk credibly about lowering emissions globally if, for example, you are slow to acknowledge climate change; if you undermine calls for an effective carbon price; and if you always descend into the ‘jobs v environment’ argument in the public debate.”
Van Beurden, recognised as one of the more articulate energy executives, has only been in the top job at Shell for a little over 12 months and after a relatively low-profile start has begun to emerge as a significant public performer.
His rival Bob Dudley, the chief executive of BP, is preoccupied with the aftermath of the Deepwater Horizon accident, while Rex Tillerson at ExxonMobil tends to avoid the limelight.
- This article has been corrected to make clear that Ben van Beurden is delivering his speech at the International Petroleum Week annual dinner on Thursday evening, not on Wednesday as originally stated.
