Shell Plc is preparing to cut staff from its offshore wind business as Chief Executive Officer Wael Sawan moves the company away from the capital-intensive renewable energy sector.

The British oil major is set to begin the layoffs within months, mainly in Europe, according to people familiar with the matter who requested not to be identified because the information is private.

“We are concentrating on select markets and segments to deliver the most value for our investors and customers,” a Shell spokesperson said. “Shell is looking how it can continue to compete for offshore wind projects in priority markets while maintaining our focus on performance, discipline and simplification.”

Shell had been spending heavily in offshore wind, aiming to leverage its experience extracting oil and gas at sea to become a leader in the technology. But soaring costs in the sector and a renewed focus on driving returns for shareholders under Sawan has led the company to back away from the green-energy source.

Since Sawan took on the CEO role at the beginning of last year, he’s put pressure on business divisions to improve performance and profitability. In June 2023, he laid out a plan to reduce “structural costs” by as much as $3 billion by the end of 2025. The cuts to offshore wind follow layoffs that started in the low-carbon solutions unit earlier this year.

Shell has built up a team, focused in the Netherlands to develop and build offshore wind farms. But the company limits on spending left a large team with less to do than previously expected.

The staff cuts follow departures of a number of key executives in the offshore wind business, including Thomas Brostrom, the head of its European renewable power division and Melissa Read, the head of its UK offshore wind unit.