Royal Dutch Shell Plc this week said it was leaving a U.S. refining lobbying organization in 2020 because the oil supermajor disagrees with the firm’s climate policy, Kallanish Energy learns.
The oil giant, in its first review of its association with 19 industry groups, said it found “material misalignment” over climate policy with the American Fuel & Petrochemical Manufacturers (Afpm). The oil giant supports the goals of the Paris climate agreement.
First major O&G company to leave Afpm
Shell becomes the first supermajor or major oil and gas company to announce it was leaving Afpm due to disagreement on climate policies.
“In line with our desire to provide greater transparency around our activities related to climate change, and in response to requests from institutional investors, we have reviewed our memberships in industry associations in Australia, Europe and North America,” Shell said, in its 48-page Industry Associations Climate Review (reviewed by Kallanish Energy).
Shell said it looked at each association’s stated position in relation to four of Shell’s climate-related policy positions: supporting the goal of the Paris Agreement on climate change; government-led carbon pricing mechanisms; policy frameworks for low-carbon technologies; and the role of natural gas in the energy system.
Aligned with just nine associations
“We found that we were aligned with nine of the 19 industry associations; that there was some misalignment with nine; and that there was material misalignment with one industry association, American Fuel & Petrochemical Manufacturers (Afpm),” Shell stated.
“We have decided not to renew our membership of Afpm in 2020 as a result.”
The review is part of Shell’s efforts to increase transparency and show investors it’s in line with the 2015 Paris climate agreement’s goals to limit the rise in global average temperatures this century to well below two degrees Celsius (2°C) above pre-industrial levels.
Van Beurden urges producers to take action
It is the latest sign of how investor pressure on oil companies, particularly in Europe, is leading to changes in their behavior concerning climate.
Shell CEO Ben van Beurden has repeatedly urged oil and gas producers to take action on climate and pollution, taking a more radical position than the leaders of other major oil companies.
“Afpm has not stated support for the goal of the Paris Agreement. Shell supports the goal of the Paris Agreement,” the Anglo-Dutch company said in its decision.
Afpm CEO Chet Thompson thanked Shell for its “longstanding collaboration.” “We will also continue working on behalf of the refining and petrochemical industries to advance policies that ensure reliable and affordable access to fuels and petrochemicals, while being responsible stewards of the environment,” Thompson said, in a statement.
AFPM counts roughly 300 U.S. and international members, including ExxonMobil, Chevron, BP Plc and Total SA, which operate 110 refineries and 229 petrochemical plants, according to its 2018 annual report.
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