Friday 13 December 2019

Shell links $10bn revolving credit facility to carbon footprint target

Shell has signed a $10 billion (£7.5bn) revolving credit facility where the interest and fees will be linked to its progress towards reaching its carbon footprint target.

The oil and gas giant has set a three-year goal to reduce its net carbon footprint by 2% to3% by 2021 compared to 2016.

It has also set an ambition to reduce the net carbon footprint of the energy products it sells by around 20% by 2035 and 50% by 2050 as it moves towards meeting the aims of the Paris climate change agreement.

A revolving credit facility is a committed bank loan facility which allows a company to borrow funds at short notice if required.

The new facility replaces Shell’s existing $8.84 billion (£6.6bn) revolving credit facility and is provided by a syndicate of 25 banks.

Russell O’Brien, Group Treasurer at Shell said: “We are delighted to support the transition to new benchmark interest rates with this, market leading, syndicated SOFR [Secured Overnight Financing Rate] facility. This is an innovative deal which also demonstrates Shell’s broad-based commitment to reducing the net carbon footprint of the energy products we sell. We appreciate the strong support and commitment from our relationship banks.”