Former Shell chief stokes London listing departure fears
The former boss of UK oil major Shell has echoed concerns that the company’s valuation gap between its London listing and a potential New York one is a “major issue”.
Speaking at the Financial Times Global Commodity Summit in Switzerland today, Ben van Beurden said that the company, the largest listed in London with a £118bn market cap, is “massively undervalued” and that the US would open up wider investment opportunities.
Shell’s share price is sitting today at £2,832 per share, an all-time high for the stock driven by the oil price gains of recent years and a promise to continue to pursue profitable fossil fuel projects.
Van Beurden, who left the supermajor in 2022 after a 39-year career, added that the US has more favourable attitudes towards conventional energy companies, a factor that is “increasingly” becoming an issue for those listed in Europe.
His comments echo those made last month by Shell’s current chief, Wael Sawan, who said he would have to “consider all options” relating to where the company domiciles.
It is understood, however, that any potential move would not come before the company has completed its so-called ‘sprint’ phrase which began in June last year and is scheduled to end next year, to improve the firm’s competitiveness and profit-making.
Coming off the back of a 2023 that saw the oil major lead UK rival BP in earnings, with $28.3bn (£22bn) for the full-year 12-month period, against $39.9bn (£31.4bn) in 2022.
These numbers were not enough to reach those achieved by the world’s largest non-government backed oil company, US giant Exxon, which posted $36bn (£28.3bn) in net income for 2023.
The company is also running a $3.5bn (£2.7bn) programme, which is expected to be completed by its first-quarter 2024 results — due out by early May.
On first quarter production, Shell said late last week that it expects strong gas production to bolster numbers.
It is also currently fighting in the Dutch courts against a 2021 ruling that determined it must reduce its carbon dioxide emissions by 45 per cent within a decade.