Azernews.Az

By Alimat Aliyeva

Shell has announced plans to strengthen its position in the liquefied natural gas (LNG) market, aiming to increase LNG production by 4-5% annually until 2030, Azernews reports.

"To ensure greater returns with lower emissions, Shell will strengthen its leadership position in the LNG market by increasing sales by 4-5% per year until 2030," the company stated in its report.

In addition to this, Shell plans to boost production in its Upstream and Integrated Gas segments by 1% annually until 2030, while maintaining its liquid hydrocarbons production at 1.4 million barrels per day. This strategy reflects the company’s ongoing focus on energy transition while preserving profitability from traditional energy sources.

Moreover, Shell has set a target for a structural cost reduction of $5-7 billion by the end of 2028, compared to 2022 levels. Initially, the company had estimated a cost reduction of $2-3 billion by the end of 2025, indicating an acceleration of cost-cutting measures in response to market conditions and sustainability goals.

Shell's capital expenditures for the 2025-2028 period are expected to range from $20-22 billion annually, reflecting a more disciplined approach to investment. Free cash flow per share is projected to increase by more than 10% annually through 2030, signaling robust financial health and resilience.

“We want to become the world’s leading gas and LNG production company and the most customer-oriented company in the field of energy marketing and trading, while maintaining a significant level of liquid hydrocarbons production,” said Shell’s CEO, Wael Savan, in a statement.

Shell's strategy reflects a shift toward more sustainable energy production while maintaining a strong foothold in traditional hydrocarbons. The company’s focus on LNG is part of a broader trend where natural gas is seen as a "bridge" fuel in the transition to a low-carbon energy future, particularly in industries where electrification is more challenging.

LNG, as a cleaner alternative to coal and oil, is expected to play a crucial role in decarbonizing global energy consumption, particularly in emerging markets where gas infrastructure is being rapidly developed. Shell’s goal of increasing LNG production by 4-5% annually aligns with global efforts to meet energy demands while reducing carbon emissions.

Additionally, Shell's cost-reduction and capital expenditure strategies will likely drive innovation and improve operational efficiency across its business segments. The company’s goal to increase its free cash flow per share by more than 10% annually indicates its confidence in achieving long-term, sustainable profitability amid growing pressure from investors and regulators to prioritize environmental, social, and governance (ESG) factors.