Shell announced on Monday the sale of its European onshore renewable energy operations to TotalEnergies, continuing the British energy giant's retreat from low-carbon investments as it shifts focus toward upstream oil and gas operations along with energy trading. The transaction covers assets in Italy, the Netherlands, Spain, and the United Kingdom, though the financial terms were not disclosed.

Since Wael Sawan took over as Chief Executive three years ago, the company's strategic priorities have gradually moved away from the renewable energy sector. Last week, Shell reported a more than doubling of its second-quarter net profit compared to the same period last year, driven by higher energy prices and strong performance in its liquefied natural gas (LNG) trading business, marking the second-highest profit level in its history.

Shell also stated on Monday that its power business will now focus on providing integrated energy solutions for large corporate clients, combining renewable electricity with more stable fossil-fuel power generation projects to reduce intermittency issues.

TotalEnergies disclosed that the deal is expected to close by the end of 2026. The assets include approximately 500 megawatts of operational and under-construction solar and wind projects, primarily in Italy and the Netherlands, along with a pipeline of 3.5 gigawatts of solar, wind, and energy storage projects across Italy, the United Kingdom, and Spain.

Separately, TotalEnergies announced it has sold a 50% stake in a 1.2-gigawatt European renewable energy portfolio to global investment firm KKR. The portfolio is valued at 1.8 billion euros, equivalent to $2.08 billion.

TotalEnergies stated that both transactions align with its strategy of developing renewable and gas-fired power generation capacity in major deregulated markets, while opportunistically divesting up to half of its renewable energy assets to realize value. The company's total European renewable energy assets currently stand at nearly 10 gigawatts, including operational and under-construction capacity, with an additional 27 gigawatts of projects in the development stage.