Royal Dutch Shell may have seen its profits slammed thanks to low oil prices, but its CEO told CNBC on Tuesday that the company’s strategy isn’t reliant on a certain oil price outcome.
“We have to be competitive, rather, at every oil price level, and that means that we have to continue to work on reducing our breakeven price of the company, making sure that we have a competitive sense of projects with a low breakeven price per project so that every point in the price cycle we are competitive,” Ben van Beurden said in an interview with “Closing Bell.”
The oil giant recently delivered its worst annual profit in more than a decade as low crude prices continued to weigh on the industry.
On the earnings conference call last week, van Beurden said that while the earnings didn’t “look good” for investors, he was pleased with the company’s performance as it completed its merger with gas utility BG.
“2016 was the transition year, 2017 needs to be the delivery year,” he said on the call.
Van Beurden told CNBC on Tuesday the company is working to pay down its debt, which will not impact its dividend.
“We have been, for two consecutive quarters, generating a free cash flow that can not only pay the cash dividend but in the last quarter also started to make headway with our debt reduction. $4.5 billion — it’s a start, but it’s in the right direction,” he said.
He also wants the company to reclaim its status as industry leader.
“For two decades we have been struggling a little bit but we are getting back to that point and I want us to be, again, back in terms of total shareholder return to the No. 1 spot.”
— CNBC’s Silvia Amaro contributed to this report.