* Says strategy does not go far enough
* Questions use of carbon capture and storage
* Says backs resolution from activist Follow This
(Adds detail from statement, bullet points, background)
LONDON, April 28 (Reuters) - The UK's Local Authority
Pension Fund Forum said on Wednesday it recommended members
oppose Royal Dutch Shell’s climate change strategy at
the company's forthcoming annual general meeting.
The oil and gas major is the first in the sector to give
investors a chance to vote on its energy transition strategy,
although the vote is advisory and the company would not be bound
to change its plans.
Shell has set an ambition of reaching net zero carbon
emissions by 2050, depending on its customers buying fossil fuel
products combined with carbon offsets from nature-based projects
or carbon capture projects.
However, LAPFF Chair Doug McMurdo said the plan did not go
far enough.
"The strategy as stated does not sufficiently address the
challenges Shell faces, with competition from renewable energy
potentially putting fossil fuel businesses out of business on
cost grounds alone," McMurdo said.
"Yet its net zero strategy is couched in such terms that
Shell will decarbonise ‘in step with society’. That is not
taking a lead, that is a recipe for being left with stranded
assets."
McMurdo also questioned Shell's reliance on carbon capture
and storage (CCS) solutions and the company's plans to plant a
large number of trees to help it reduce its emissions.
"There are references to relying on very large amounts of
carbon capture and storage (CCS), yet it is unclear for what
products, and CCS doesn’t work without subsidy and it does not
result in ‘net zero’," he said.
On the tree-planting plans, McMurdo said the scale of
tree-planting needed did not seem credible, and nature-based
solutions should be focused on difficult-to-abate sectors such
as cement, chemical manufacturing and aviation.
Instead, the LAPFF, whose 82 members manage over 300 billion
pounds ($416.61 billion) in assets, said it backed a resolution
from activist group Follow This calling for the company's
targets to be aligned with the Paris Agreement on climate.
The AGM takes place on May 18.
($1 = 0.7201 pounds)
(Reporting by Simon Jessop, Ron Bousso and Shadia Nasralla;
editing by Carolyn Cohn)
