Shell They Say Goodbye? Energy Giant Might Give Norway's Wind Farm the Cold Shoulder
Portfolio Pulse from Lekha Gupta
Shell PLC (NYSE:SHEL) is considering withdrawing from the tender for Norway's first commercial offshore wind farm, Soerlige Nordsjoe II, due to concerns over the project's profitability. Despite being part of a consortium with Norwegian utilities and having applied for pre-qualification, Shell's Norway country manager, Marianne Olsnes, expressed doubts about the business case and the challenging tender conditions. The tender, which includes subsidies of 23 billion Norwegian crowns ($2.17 billion), is seen as a critical step for Norway's offshore power developments from 2040. Shell's recent financial results showed a revenue miss but an earnings beat.
February 15, 2024 | 1:13 pm
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Shell PLC is contemplating pulling out from Norway's offshore wind farm project due to profitability concerns, amidst a backdrop of mixed financial results.
Shell's consideration to withdraw from the Norwegian wind farm project due to profitability concerns could negatively impact investor sentiment, especially in the context of its recent financial performance. The company's revenue miss may already have investors on edge, and doubts about the viability of its renewable energy projects could further dampen confidence. However, the earnings beat provides a counterbalance, suggesting that the company's core operations remain strong. The net effect is likely negative in the short term as the market digests the implications of Shell's potential withdrawal from the wind project.
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