LONDON, June 22 (Reuters) - The Church of England Pensions Board said it had decided to divest its holding in Shell over what it said were insufficient plans to align its strategy to the goal of limiting global warming to 1.5 degrees Celsius.

The Board, which up to 2022 led engagement with Shell on behalf of the CA100+ climate-focussed investor group, has around 1.35 million pounds ($1.72 million) invested in Shell of its total 3.2 billion pounds in investments.

The Church of England's separate 10.3 billion pound Church Commissioners fund will also divest from all remaining oil and gas companies in its portfolio, including Shell, BP, Equinor and TotalEnergies, it said on Thursday.

"The Church will follow not just the science, but our faith – both of which call us to work for climate justice," Justin Welby, the Archbishop of Canterbury, said in a statement.

The Pensions Board said in its statement it would no longer prioritise engagement with the oil and gas sector on climate change and would instead refocus its efforts on reshaping the demand for oil and gas from sectors such as the auto industry.

Shell aims to reduce carbon emissions to net zero by 2050 and has set several short and medium-term emission intensity targets, but has so far rejected calls to set 2030 goals to reduce absolute emissions.

Scientists say the world needs to cut greenhouse gas emissions by about 43% from 2019 levels by 2030 to meet the Paris Agreement's goal of keeping warming to less than 2 degrees Celsius (3.6 Fahrenheit) above pre-industrial levels.

A Shell spokesperson said the Church funds' decisions were "disappointing, but not surprising", adding Shell believed it was Paris-aligned.

"At the same time, we are clearly focused on capital discipline, enhanced performance and delivering shareholder value," the Shell spokesperson said.

This year, the Board voted against Shell's chair and directors over climate concerns and in favour of an activist shareholder resolution asking Shell to set Paris-aligned emissions targets for 2030, which received 20% support.

($1 = 0.7839 pounds) (Reporting by Shadia Nasrall and Muvija M; Editing by Jan Harvey)