Shell (NYSE:SHEL), the British oil major, has announced plans to increase shareholder returns and maintain steady oil output, aiming to simplify its business and boost investor confidence, CNBC reports.
Boosting Shareholder Returns: Shell plans to raise shareholder distributions to 30% to 40% of cash flow from operations, up from the previous 20% to 30%. This includes a 15% increase in the dividend per share from the second quarter and executing at least $5 billion of share buybacks in the second half of the year.
Steady Oil Output: Shell intends to maintain its current oil production levels until the end of the decade, aiming to generate more cash from its oil division. However, the company also reiterated its commitment to climate targets, stating it is making “good progress” towards becoming a net-zero business by 2050.
Criticism from Activist Shareholders: Shell’s decision to refrain from new oil output cuts has drawn criticism from activist shareholder group Follow This. The group’s founder, Mark van Baal, stated that Shell’s growth in fossil fuels puts the company “on a collision course” with the 2015 Paris Agreement.
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