Shell (SHEL.US) has been continuously reducing its renewable energy business and is considering pulling out of the Scottish offshore wind farm project.

As Shell (SHEL.US) continues to cut its renewable expansion plans, the company plans to sell the leases it won for floating wind farms off the coast of Scotland. Shell hopes to sell its stake in the joint venture with Scottish Power Renewables, a subsidiary of Iberdrola, which will develop up to 5GW of floating wind farms.

It is worth noting that at the end of May, it was reported that Shell planned to cut jobs in its offshore wind business in the coming months, mainly in Europe. A Shell spokesperson said previously: "We are focusing on markets and areas where we can create the most value for our investors and customers. Shell is looking at how to continue to compete in key offshore wind projects while maintaining our focus on performance and simplification."

The decision to exit the floating wind project off the coast of Scotland highlights the challenges the UK government faces in developing floating wind as a major industry. The offshore wind industry has been struggling to cope with rising interest rates, supply chain bottlenecks and inflation, all of which have driven up project costs.

Since taking over Shell in early 2021, the company's chief executive Wael Sawan has refocused on generating profits for shareholders. The company is now more focused on generating low-carbon power for its own use and trading, rather than investing in large-scale renewable projects that could take years to return a profit. This shift is also behind the company's plans to cut jobs in its offshore wind business. This is a stark contrast to the approach Wael Sawan took as head of Shell's gas, renewables and integrated solutions.

Wael Sawan has promised to "spare no expense" in improving the company's performance while increasing shareholder returns. In its February earnings call, Shell stressed that its top priority was to improve shareholder returns while reducing the company's less profitable businesses, such as renewables.