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Shell’s top executive in the US has said the Trump administration’s decision to halt fully permitted offshore wind energy projects is “very damaging” to investment and called for more predictable regulation.
Colette Hirstius, president of Shell USA, told the Financial Times that energy projects with proper permits should be allowed to proceed, warning the political pendulum in the US could eventually swing back against the oil and gas sector.
“I think uncertainty in the regulatory environment is very damaging. However far the pendulum swings one way, its likely that its going to swing just as far the other way,” she said when asked about the administration’s stop-work orders on offshore wind farms.
“I certainly would like to see those projects that have been permitted in the past continue to be developed. Similarly, if you think of the business I run offshore [Gulf of Mexico], that type of permitting uncertainty has been utilised to undermine the permits that we have in the past — and that’s equally as damaging.”
Hirstius took over as Shell USA president in August and has retained her previous role of executive vice-president of the Gulf of America, a region that produces about 15 per cent of US oil. US President Donald Trump issued an executive order in January renaming the Gulf of Mexico the Gulf of America, prompting most oil companies to follow suit.
In that position, Hirstius was forced to adapt to former president Joe Biden’s stringent restrictions on offshore lease sales, which posed a threat to the oil and gas industry.
“Predictability about lease sales, predictability about permitting — these are really important elements that contribute to the confidence that we have in this basin . . . I think the Gulf as a whole did suffer from that [Biden lease restrictions],” she said.
Shell is the largest oil producer in the Gulf with 11 offshore facilities and has been present in the region since 1947. It employs more than 11,000 people in the US and invests about $10bn a year — the largest capital outlay in any country.
Hirstius said the Trump administration’s decision to reinstate annual lease sales was a “big step forward” that would encourage investment. A reduction in royalty rates on offshore production and a relaxation of some rules on drilling in the Gulf would also encourage production, she said.
Hirstius said Shell was planning to bid for new leases in a sale in December, the first held under a new annual schedule set by Trump that stretches to 2040.
But she said tariffs were another area of concern, as they affect projects that were greenlit by Shell and other companies years ago.
“Much of the steel that we use, the fabrication, the welding techniques, you can’t fabricate it in the US. It’s not an option,” said Hirstius, adding that Shell is exploring whether it can obtain relief from the administration.
“It’s about the predictability. What I will say is that I have found the current administration and many of the secretaries very willing to listen . . . We haven’t gotten any relief yet.”
Shell has weakened some of its climate and energy transition targets under chief executive Wael Sawan, who took the helm in January 2023 following a surge in oil prices following Russia’s full-scale invasion of Ukraine. Last year the company dropped its 2035 target of a 45 per cent reduction in net carbon intensity, citing the “uncertainty in the pace of change in the energy transition”.
Asked if Shell had misjudged the timing of the energy transition, Hirstius said the company wanted to fully participate in the shift to low-carbon energy but it had to make sure the things it invested in were “economically viable”.
In January Shell exited the Atlantic Shores wind project off the coast of New Jersey, taking an almost $1bn write-off just days after Trump posted on Truth Social that “hopefully the project is dead and gone”. But the company continues to selectively develop renewable generation projects in the US and elsewhere when it can generate financial returns.
Hirstius said Shell’s stable output policy did not restrict it from exploiting hydrocarbon resources in the US, which is the world’s biggest oil and gas producer. “It takes multibillion-dollar investments every year to stay flat,” she said, noting that annual production rates in Gulf oilfield decline by as much as 15-20 per cent every year.
Shell sold its onshore shale oil assets in the Permian basin, the US’s largest oil basin, in 2021 for $9.5bn shortly before oil prices surged. Hirstius said any decision to move back into US shale would have to reflect an “incredible value proposition”.
Hirstius, who is one of the most senior women in the US oil industry, said Shell had no plans to back away from its commitment to diversity, equity and inclusion despite an effort by the Trump administration to dismantle initiatives in the public sector.
“When we talk about the culture within Shell and the performance culture. I think one of the aspects that is in every fibre — and it’s not just in the US, its globally — is the idea of diversity, inclusion in order to unlock business opportunity,” she said.
“It’s hard to step away from that. We wouldn’t want to.”
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