Partnership to accelerate net zero energy transition

SHELL and energy technology company Baker Hughes have signed a memorandum of understanding (MoU) to accelerate the global energy transition by helping each other to achieve net zero commitments and advance solutions to decarbonise energy and industry.

Lorenzo Simonelli, CEO of Baker Hughes, highlighted that the “urgency around the energy transition to meet Paris Agreement goals requires collaboration to accelerate actionable steps to reduce emissions in various ways”. The broad strategic collaboration agreement will see the companies focus on three key areas.

As the first step in the collaboration, Shell will provide Baker Hughes US sites with power and renewable energy credits for a two-year period. The agreement is expected to allow Baker Hughes to grow its global renewable energy consumption from 22% (in 2021) to 24% annually. The companies will also negotiate supply of up to 100 GWh of renewable power to Baker Hughes facilities in Europe and explore development of onsite solar for the technology company’s chemical blending plant in Singapore.

Through broader collaboration, Baker Hughes and Shell will work to identify and evaluate other opportunities to accelerate their transitions to net zero carbon equivalent emissions by 2050. Shell announced its 2050 net zero pledge in April 2020, and laid out its strategy to achieve this goal earlier this year.

Opportunities for the companies to explore include Baker Hughes providing low-carbon technologies for Shell’s liquified natural gas fleet through upgrades and compressor re-bundles, and Shell providing low-carbon transportation and fuel solutions for Baker Hughes. The energy technology company will also help Shell develop digital technologies to accelerate decarbonisation across Shell’s global assets and operations.

Finally, the companies will also explore how they might co-invest and participate in new models to decarbonise energy and industrial sectors globally.

The partnership between Baker Hughes and Shell builds on an existing relationship which includes Baker Hughes becoming the first supplier in Shell’s Supplier Energy Transition Hub. The digital, co-learning platform allows suppliers to define and estimate emissions reduction ambitions while learning from other industries.

Harry Brekelmans, Projects and Technology Director at Shell said: “Shell and Baker Hughes both have clear ambitions to decarbonise and have already made progress through technical innovations. I’m proud of the work that has been done so far, and with this new agreement, we are taking it one step further. It will enable us – and our partners – to push the boundaries of what can be achieved and move even closer toward our net-zero targets.”