Shell Shock: Oil Giant Announces Corporate Headquarters to Relocate to London

Global oil giant Shell has announced the relocation of its corporate headquarter from the Netherlands to London and proposed a simplified share structure in alignment with the change in tax residence.

The move, which still needs to be approved by shareholders, would also see the company drop the “Royal Dutch” from its name.

The Netherlands was reported to be unpleasantly surprised by the proposals.

“The Cabinet regrets to the utmost that Shell wants to move its head office to the United Kingdom,” Economic Affairs and Climate Minister Stef Blok said, quoted by news agency Reuters. “We are in a dialogue with the management of Shell over the consequences of this plan for jobs, crucial investment decisions and sustainability.”

In a news release, Shell’s Chair, Sir Andrew Mackenzie, defended the move: “At a time of unprecedented change for the industry, it’s even more important that we have an increased ability to accelerate the transition to a lower-carbon global energy system. A simpler structure will enable Shell to speed up the delivery of its Powering Progress strategy, while creating value for our shareholders, customers and wider society.”

Since 2005, the company has been incorporated in both the UK and the Netherlands and has operated a dual share structure. The company claims the simplification will enable it to more easily distribute money back to shareholders and also help aid the company rise to the challenge of the energy transition.

But the timing - six months after the company suffered a setback in the Dutch courts over its plans to cut emissions - has left some questioning whether carbon emission targets and a long running dispute with the Netherlands over taxes might be the real reason behind the change.

According to a statement on the Shell website, the company intends to meet the goal of the UN Paris agreement on climate change to limit global temperature increases to below 1.5 degrees Celsius above pre industrial levels by becoming a net-zero emissions energy company by 2050. It aims to meet this goal by reducing the carbon intensity of its business operations and the fuel and energy products they sell to customers.

The shareholder vote on the proposed changes is scheduled to take place on December 10, 2021.