WET: How does a global company like Shell strategically diversify, innovate, and financially prepare itself to support both the UAE and its stakeholders, keeping in mind the objectives of Carbon Net Zero by 2050?
Fakher: Shell's strategy to achieve Carbon Net Zero by 2050 involves a comprehensive approach that includes diversifying its energy portfolio, investing in low-carbon technologies, and enhancing financial resilience. Shell aims to halve emissions from its operations by 2030 and has committed to investing $10-15 billion in low-carbon energy solutions by 2025. This includes expanding its liquefied natural gas (LNG) business, reducing emissions from oil and gas production, and increasing sales of low-carbon energy solutions. Shell's strategy also emphasizes maintaining secure and affordable energy supplies while transitioning to low-carbon energy.
WET: Technology has a major role to play in the decarbonization effort. Shell's investment in services and technology for the industry is marking its commitment to the transition. Where is Shell focusing its efforts in this respect?
Fakher: Shell is focusing its efforts on several key areas to drive decarbonization through technology. This includes investments in renewable fuels, hydrogen production, and carbon capture and storage (CCS). Shell's decarbonization solutions portfolio aims to help customers in hard-to-abate industries reduce their carbon footprint. Additionally, Shell Ventures invests in new technologies and disruptive business models to accelerate the energy and mobility transformation.
CCUS has the potential to capture large volumes of CO2, making it one of the most impactful methods for reducing emissions – especially in industries that are difficult to decarbonise, like steel manufacturing. However, the technology remains expensive, and scaling it up to commercially viable levels has been a challenge around the world. Abu Dhabi is at the forefront of this effort.
WET: How would you assess the current regulatory framework in terms of its ability to support the energy transition?
Fakher: The current regulatory framework plays a crucial role in supporting the energy transition. Progressive policies and regulatory measures are essential to achieve the necessary levels of deployment of renewable energy technologies by 2030. Regulatory frameworks can either enable or restrict the ability of regulators to address challenges surrounding the energy transition. A holistic global policy framework is needed to orchestrate a just transition that strengthens international finance flows, capacities, and technologies.
For instance, for CCUS to be deployed at scale, it requires not just investment from the private sector but also supportive government policies and the development of suitable infrastructure. The energy sector in Abu Dhabi is critical to advancing these initiatives, as it is leading efforts to integrate CCUS into existing operations and scale the technology.
WET: For energy producers, transitioning to more renewables and new energy sources, such as hydrogen, presents a range of challenges too. How is Shell approaching future energies?
Fakher: Shell is approaching future energies by investing in a diverse range of low-carbon technologies and solutions. This includes renewable energy sources like solar and wind, as well as hydrogen production and carbon capture and storage. Shell's scenarios explore different possible futures to help make better decisions today, considering long-term trends in energy supply and demand, geopolitical shifts, and social change. Shell's energy transition strategy aims to transform its business to achieve net-zero emissions by 2050.
WET: International Collaboration across industry and other key stakeholders will be central to success. How are partnerships helping Shell to make a statement globally?
Fakher: Shell's partnerships are crucial in driving innovation and accelerating the energy transition. Shell collaborates with technology companies, research institutions, and industry partners to develop and deploy digital solutions at scale. These collaborations help ensure a continuous influx of fresh ideas and speed the adoption of new technology. Shell's research alliances and industry collaborations also play a significant role in developing low-carbon technologies and addressing key technology challenges.
WET: Where do you see the largest amount of collaboration for the transition in the UAE and globally, with the role the country can play in marking its stance in global change?
Fakher: The UAE is playing a significant role in the global energy transition through various collaborations and initiatives. The UAE has partnered with the US to expand clean energy access and decarbonize industry through the Partnership for Accelerating Clean Energy (PACE). Additionally, collaborations between UAE-based companies like TAQA, EWEC, and Masdar are driving investment in renewable energy and low-carbon infrastructure. These partnerships highlight the UAE's commitment to advancing the global energy transition and strengthening international cooperation.
In 2023, Shell produced the UAE scenario sketch in close collaboration with the Ministry of Energy and infrastructure. UAE is poised to unlock technologies and infrastructure that are critical to meeting not only its growth aspirations, but also its emission reduction ambitions. Beyond its own bold vision, the UAE has an enormous opportunity ahead: to become a prosperous pioneer in deploying lower-carbon energy resources, technologies and approaches that help to address both domestic and international climate challenges.
With the UAE’s significance in global trade, whether it be for heavy industry, ports or airports, the path the UAE decides to take will also have wider, global repercussions and a stark impact on the hard to abate marine and aviation sectors particularly.
