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Royal Dutch Shell approved a deal on Monday to buy a 43.8 percent stake in Silicon Ranch Corp, a solar energy company currently owned by the Partners Group’s energy portfolio.
A second agreement signed by Shell also gives it an opportunity to increase its stake in Silicon Ranch after the year 2021. The deal should officially close by March, Reuters reports.
Shell has made an active effort to curb its carbon dioxide output, pledging in November to cut emissions in half over the next 50 years. Its portfolio will soon include more biofuels, renewable energy, and innovative supply chain management efforts. Buying companies already in those spaces gives Shell an additional stake in the future of sustainable power.
Last year, CEO Ben van Beurden told CNBC, "Our view is if society needs to tackle the dual challenge of climate change but also accommodating higher demand for energy — as of course the energy poor need to get access to energy as well — we have to reduce the carbon footprint of the energy system as a society to a net zero level."
Shell, one of the largest oil and gas companies in the world, will also soon invest in carbon capture and storage projects, increasing its total expenditure on renewable energy from $1 billion annually to $2 billion. This is a drop in the bucket compared to its main expenditures budget for oil and gas, which is planned to be valued between $25 billion and $30 billion.
Natural gas will also help Shell to move away from heavy emissions. Van Beurden corrected his CNBC interviewer last year when he called Shell an oil company. “If anything, we are more a gas and oil company,” he said. “And on top of it, we are a much broader energy company as well.”
Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…