WHILE one oil giant had difficulty convincing campaigners it was serious about climate change last week, some appeared concerned that another major might be showing too much enthusiasm for the renewables business.

Royal Dutch Shell bosses featured in a very slick online presentation that was made to accompany the strategy update the Anglo-Dutch firm issued.

In the update, Shell set out what sounded like ambitious targets to become a net zero business in terms of emissions by 2050, which went beyond what some might have expected.

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The emissions targeted include those associated with the production of oil and gas in areas such as the North Sea.

Shell plans to invest heavily in reducing the carbon content of the fuels and lubricants it produces.

It also intends to ramp up its presence in the market to supply low carbon power generated from windfarms and the like to customers.

The company thinks it is being particularly ambitious because its target includes Scope 3 emissions. It notes these include emissions from the oil and gas that others produce and Shell then sells as products to customers.

Shell chief executive Ben van Beurden said meeting the net zero target will involve Shell working hard with companies in the supply chains of hard to decarbonise sectors such as aviation and shipping to find ways of reducing their emissions.

The presentation made clear that a lot of time and effort has gone into thinking through the problem of climate change and how the company should respond.

But Shell came under fire because of something the update lacked: a commitment to stop producing oil and gas.

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Shell said oil production will decline by up to two per cent annually as other kinds of energy become more important. It sees gas as an important transition fuel that will be required while the required renewables capacity is developed.

The company expects to use the profits it generates from the production of hydrocarbons to help fund investment in support of the energy transition.

Mr van Beurden underlined how important the North Sea business is as a cash generator. It is one of nine core oil and gas areas on which Shell will focus.

READ MORE: Shell boss highlights value of North Sea business as company cuts Aberdeen jobs

Greenpeace was scathing about the update.

“Shell’s grotesque ‘customer first’ strategy seeks to blame customers first for climate change,” said Mel Evans, head of the organisation’s UK oil campaign.

“Meanwhile Shell, the powerful oil major, brazenly says it will dodge oil production cuts and will simply let output dwindle.

“Without commitments to reduce absolute emissions by making actual oil production cuts, this new strategy can’t succeed nor can it be taken seriously. Shell’s plans include a delusional reliance on tree-planting.”

On a call with reporters Mr van Beurden indicated he felt criticism of Shell’s approach was unfair. The company reckons its strategy supports the most ambitious goal of the Paris Agreement on climate change to limit the global temperature rise to 1.5° Celsius.

If oil and gas firms cease production the world will burn much more coal. Some industries could grind to a halt.

Mr van Beurden said it did not make sense to judge Shell on how much it invested in windfarms. It may be wiser for the company to buy the power generated by specialists in such sectors to sell on to its customers.

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Schemes involving things like tree-planting are going to be required to help offset emissions that can’t be eliminated.

One sobering implication of Shell’s analysis is that carbon capture, storage and usage projects will need to be developed at scale and in large numbers around the world if the Paris targets are to be met.

People have been talking excitedly for years about the potential to use depleted North Sea reservoirs to store carbon without any large scale schemes being brought into operation.

Shell may have done more to convince sceptics it had the right priorities if it had not also made lots of noise in the update about how much money it plans to pay out to shareholders in coming years.

The company cut its dividend in April for the first time since the Second World War, to 16 cents per share for the first quarter from 47 cents in the preceding three months, to help save cash.

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However, Shell plans to increase the payment for the current quarter by four per cent, to 17.35 cents per share, from 16.65 cents for the last quarter of 2020.

More increases are expected to follow under the company’s plan to follow a progressive dividend policy.

Share buy backs will be back on the agenda once net debt has been reduced to the targeted $65bn.

The planned payouts may keep investors onside, including many pension scheme members.

However, if Shell wants to be seen as playing a positive part in wider society it perhaps should not attach so much importance to the needs of one group of stakeholders.

In January Shell announced plans to cut around 330 North Sea jobs to help it save cash and to respond to the energy transition.

Shell’s arch rival BP appears set on following a broadly similar approach under new chief executive Bernard Looney.

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He plans to reinvent the firm as an integrated energy business with the aim of achieving net zero in terms of its operations and oil and gas production by 2050. The production of hydrocarbons will remain an important part of the mix. While BP has retrenched in the North Sea it is still an important area for the business.

BP may be set to invest more than Shell in developing renewable energy assets with partners, rather than buying others’ output.

The company has developed Lightsource BP into a big player in the solar market.

It sent shock waves through the renewables sector last week by putting itself in position to become one of the biggest forces in the offshore wind market in the UK.

BP was appointed preferred bidder with a German energy firm for licences that were offered in the first offshore wind leasing round of its kind in a decade.

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The venture partners have agreed to pay the Crown Estate around £1.8 billion fees over the first four years in total. They could invest significantly more if they decide to proceed with the investment required to develop windfarms on the leases, which cover acreage between the Isle of Man and Liverpool.

The decision reflects the fact that BP expects to make huge amounts of money in the UK wind business, even after investing lots up front.

Mr Looney said: “We are fully confident that these highly advantaged resources will deliver - at a minimum – the eight-10 per cent returns we demand of our renewables investments.”

The round held by the UK Crown Estate covered the waters off England, Northern Ireland and Wales.

Management of the Crown Estate in Scotland was devolved to the Scottish Government in 2017.

In June last year Crown Estate Scotland launched the first offshore wind leasing round to cover acreage off the country for a decade, in the expectation that it could unlock billions in investment.

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However the outcome of the UK round prompted the Crown Estate in Scotland to delay the outcome of the Scotwind exercise. It wants more time to consider whether bids reflect the changing commercial reality.

The decision was criticised by trade body Scottish Renewables, which said members that had invested thousands of hours and many millions of pounds preparing to bid would be disappointed and intensely frustrated by the latest delay to a process that was initially expected to conclude in January 2020.

It expressed fear about the possibility that the goalposts would be moved at such a late stage.

Others appeared worried that giants such as BP could crowd smaller players out of the offshore wind market and wondered about the implications for energy prices. The regulator Ofgem must keep a close eye on developments .