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Posts from ‘August, 2004’

Shell waives Czech refinery share option

Reuters: Shell waives Czech refinery share option

Mon 30 August, 2004

Posted 31 August 04

PRAGUE (Reuters) – Royal Dutch/Shell says it will not exercise its option to buy extra shares in top Czech oil refinery Ceska Rafinerska, held by state-controlled group Unipetrol.

Shell is the first of three Unipetrol partners in Rafinerska — the other two are ENI’s Agip and ConocoPhillips — to react on an obligatory buyout offer made by Unipetrol in June.

Shell said on Monday it would keep its existing 16.3 percent stake in the refinery.

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Shell, Sinopec Launch Gas Station Venture

Forbes: Shell, Sinopec Launch Gas Station Venture

“Royal Dutch/Shell and China Petroleum and Chemical Corp., have launched a joint venture to operate a network of about 500 service stations in eastern China’s Jiangsu province…”

Associated Press

08.31.2004

Royal Dutch/Shell and China Petroleum and Chemical Corp., have launched a joint venture to operate a network of about 500 service stations in eastern China’s Jiangsu province, one of the country’s fastest growing regions.

China Petroleum, also known as Sinopec, and Shell inaugurated the Sinopec and Shell (Jiangsu) Petroleum Marketing Co. Ltd. in the provincial capital, Nanjing, over the weekend after receiving government approval, the companies said in statements on their Web sites.

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Shell Abandons ‘Self First’ Bonus Culture

The Scotsman.com: Shell Abandons ‘Self First’ Bonus Culture

“Shell was found by the Financial Services Authority in the UK and the Securities and Exchange Commission in the US to have committed market abuse and breached listing rules by misleading the market over the extent of its reserves.”

By Nicky Burridge, Personal Finance Correspondent, PA News

Posted 31 August 04

Oil giant Shell is changing its bonus scheme to encourage staff to focus on the whole company not just their own division, it emerged today.

The group, which has been embroiled in a crisis over its reserves, hopes the move will convert a “self first” culture into an “enterprise first” one.

The new scheme, which it hopes to have in place for 2005, will no longer pay out bonuses based on a combination of an individual’s performance and that of their division.

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Shell Sheds Refineries, Gas Stations

THE WALL STREET JOURNAL: Shell Sheds Refineries, Gas Stations

“Even after this year’s headline-grabbing scandal over its oil reserves, most people still best know Anglo-Dutch oil company Royal Dutch/Shell Group by the scallop-shell logo”: “a lot fewer people will be seeing this iconic emblem in the future”

Broad Plan Is Under Way

To Help Boost Profitability

Of Oil Products Division

By MARK LONG

DOW JONES NEWSWIRES

August 31, 2004

LONDON — Even after this year’s headline-grabbing scandal over its oil reserves, most people still best know Anglo-Dutch oil company Royal Dutch/Shell Group by the scallop-shell logo on its service stations and products.

But a lot fewer people will be seeing this iconic emblem in the future, as Shell rolls out a significant global purge of its refineries and gas stations.

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Shell EP Africa leadership to comprise 30% Nigerians…

Vanguard: Shell EP Africa leadership to comprise 30% Nigerians…New SPDC DMD appointed

“challenging security situation in the Niger Delta as well as the rising incidence of crude oil theft, currently put at 50,000 per day.”

By Hector Igbikiowubo

Tuesday, August 31, 2004

SHELL Exploration and Production (EP) Africa leadership is to be made up of 30 per cent Nigerian staff from the beginning of October this year when the headquarters is relocated from the Hague to Lagos.

The company has also announced the appointment of Mr. Mark Corner as the new deputy managing director.

Mr. Chris Finlayson, the outgoing managing director of Shell Petroleum Development Company (SPDC) made the disclosure while speaking at a diner party organised in honour of senior management staff of the company in Lagos last week.

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Sinopec denies quitting project

Financial Times: Sinopec denies quitting project

“The company also announced a $187m joint venture with Royal Dutch/Shell to operate 500 petrol stations in eastern China.”

By Enid Tsui in Hong Kong

Published: August 31 2004

Chen Tonghai, chairman of Sinopec, one of China’s big three oil companies, yesterday denied that his company had withdrawn from the controversial west-east gas pipeline project in China.

The statement, made at a press conference in Hong Kong, contradicted an August 5 filing by rival Petrochina, which claimed that the joint venture framework agreement signed by all potential investors in the project, including Royal Dutch/Shell and Exxon-Mobil, had been terminated.

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Boards beware: the road to Shell was paved with ‘good’ intentions

Daily Telegraph: Boards beware: the road to Shell was paved with ‘good’ intentions

“This being Shell, everything was systematic, and was approved at the highest level, and had been going on for years.”: “On top of all this comes the loss to Shell’s reputation – its ultimate hidden reserve.”: “It will have to be rebuilt and earned, and that takes time, if it can be done at all.”

By Chrsitopher Fildes (Filed: 31/08/2004)

Goodwill is hard to measure. Auditors prefer to write if off. Cynics define it as the difference between what you pay for something and what it proves to be worth. It can amount to a hidden reserve, until it turns out to have been overstated. Textbook example: Shell.

Everybody knew Shell, or thought they did. It was too big to miss, after all – durable, self-perpetuating and professional.

Its worst critics called it boring. That changed on the day when Shell owned up to overstating its reserves of oil, and the chairman was told to clear his desk.

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AUGUST 2004 ROYAL DUTCH SHELL NEWS

AllAfrica.com: Shell Plans $9bn Five-Year Investment

AllAfrica.com: Shell Plans $9bn Five-Year Investment

“Coming at a time when there was some speculation about Shell’s future in Nigeria, this development is a resounding demonstration of Shell’s long-term commitment…”

Mike Oduniyi

This Day (Lagos)

Posted 31 August 04

Moves Headquarters to Port Harcourt January

Shell Petroleum Development Company (SPDC) is planning to invest another $9 billion in the Nigerian oil and gas sector, over the next five years.

The investment covers the company’s joint venture projects with the Nigerian National Petroleum Corporation (NN-PC), oil exploration and production in the deep offshore and the expansion of the Nigerian Liquefied Natural Gas (LNG) plant.

Already, Shell has awarded a $43 million contract for the exploitation of non-associated gas from its Oil Mining Leases (OMLs) 35 and 46. The gas will be supplied to the Bonny LNG plant from 2008.

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Malaysia’s Shell Refining posts highest quarterly profit

Hydrocarbon Asia: Malaysia’s Shell Refining posts highest quarterly profit

“Chairman Jon Chadwick said: “We are pleased with this back-to-back achievement, surpassing even the record profit for the first quarter this year.”

Posted 30 August 04

SHELL Refining Company Bhd announced a net profit of RM175.3mil (US$1 = RM3.8) for its second quarter ended June 30, beating an earlier record profit of RM122.5mil in the first quarter.

Chairman Jon Chadwick said: “We are pleased with this back-to-back achievement, surpassing even the record profit for the first quarter this year.

“The excellent financial results was mainly due to the continued strength of our refining margins, sustained operational performance and to a lesser extent, stockholding gains,” he said in a statement yesterday.

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Planet Ark: Shell in talks with China on Sakhalin gas deal

Planet Ark: Shell in talks with China on Sakhalin gas deal

CHINA: August 30, 2004

SHANGHAI – Energy giant Royal Dutch/Shell is keen to sell liquefied natural gas LNG.L from its Sakhalin project to China, as it vies with rivals such as BP to tap the market’s potentially explosive growth.

But the world’s third-biggest oil group RD.AS SHEL.L will first have to overcome pricing issues and a still tiny market for supplies from the island development off eastern Siberia’s coast.

Shell, the biggest private supplier of LNG with sales of more than eight million tonnes per year, is ramping up efforts to tap a gas market expected to boom in coming years as Beijing inches toward cleaner fuels. Rival BP BP.L is hard on its heels.

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Planet Ark: Russian Oil Project to Be Vetted for Whale Threat

Planet Ark: Russian Oil Project to Be Vetted for Whale Threat

“the International Whaling Commission last month warned energy exploration could kill off the 100 or so remaining gray whales on the oil-rich shelf near Russia’s Pacific coast”

SWITZERLAND: August 30, 2004

GENEVA – A top environmental group said last week it had agreed to probe an oil and gas project led by Royal Dutch/Shell off the Russian far east coast because of fears it threatens endangered whales.

The World Conservation Union said the Sakhalin Energy Investment Company had requested an independent study into its plans to expand production around Russia’s Sakhalin Island near feeding grounds of the Western Gray Whale. The independent scientific panel is expected to complete the review by the end of November. “Until then, Sakhalin Energy has postponed certain development work,” said the Swiss-based inter-governmental organization.

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Shell Reserves Scandal: Retired Shell engineer played central role

FROM OUR AUGUST 2004 SHELL NEWS ARCHIVE

Financial Times: Retired Shell engineer played central role

“the company had been engaged in accounting manoeuvres since 1997-98, including a flawed internal audit function”;  “Shell had engaged as [group reserves auditor] a retired Shell petroleum engineer – who worked only part time and was provided with limited resources and no staff – to audit its vast worldwide operations.”

By Adrian Michaels in New York and Carola Hoyos and Andrew Parker in London

Posted 30 August 2004

US and UK regulators on Tuesday went several steps further than Royal Dutch/Shell in their dissection of what went wrong.

The Anglo-Dutch oil group had already presented the main findings of an internal investigation in April into its reserves debacle.

That report heavily criticised dismissed senior executives – Walter van de Vijver, the former head of exploration, and Sir Philip Watts, former chairman. But it had less to say on how the company had been engaged in accounting manoeuvres since 1997-98, including a flawed internal audit function. The US’s Securities and Exchange Commission and the UK’s Financial Services Authority delve into the origin of the problems. “

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Shell, Sinopec in China Retail Venture

New York Times: Shell, Sinopec in China Retail Venture

“But Shell still lagged rival BP in the race for a piece of the lucrative Chinese market.”

By REUTERS

August 30, 2004

SINGAPORE (Reuters) – Royal Dutch/Shell Group(SHEL.L) said it would jointly operate 180 gas stations in China by the end of 2004, the second foreign oil major after BP to enter the country’s huge but tightly controlled retail market.

Shell’s joint-venture with state refiner Sinopec Corp (0386.HK) (SNP.N), would eventually run 500 retail outlets in eastern Jiangsu province, with total investments of $187 million, the companies said in a statement received by Reuters on Monday.

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Royal Dutch/Shell plans new staff bonus scheme

AFX Europe (Focus): Royal Dutch/Shell plans new staff bonus scheme

“Bernstein Liebhard & Lifshitz… ‘lead plaintiff’… considering including the auditors when it files an amended complaint against Shell next month.”

Aug 29, 2004

Posted 30 August 04

LONDON (AFX) – The Royal Dutch/Shell Group of companies intends to launch a new, company-wide bonus scheme from January as an incentive for staff to work together to rebuild the company’s credibility, The Sunday Times reported citing Jeroen van der Veer, chairman of the committee of managing directors.

He said he hoped it would encourage staff to think “enterprise first” rather than “self first”, according to the article.

The plans are still subject to staff negotiation in some countries, but about 90,000 people are expected to be covered by the arrangements.

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Shell Plans $9bn Five-year Investment

TheDayOnline (Nigeria): Shell Plans $9bn Five-year Investment

“Shell said it was currently losing on the average, 50,000 barrels per day (bpd) to crude theft.”

Moves headquarters to Port Harcourt January

By Mike Oduniyi

Posted 30 August 04

Shell Petroleum Development Company (SPDC) is planning to invest another $9 billion in the Nigerian oil and gas sector, over the next five years.

The investment covers the company’s joint venture projects with the Nigerian National Petroleum Corporation (NN-PC), oil exploration and production in the deep offshore and the expansion of the Nigerian Liquefied Natural Gas (LNG) plant.

Already, Shell has awarded a $43 million contract for the exploitation of non-associated gas from its Oil Mining Leases (OMLs) 35 and 46. The gas will be supplied to the Bonny LNG plant from 2008.

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Shell Plans Team Performance Bonus Scheme From January

THE WALL STREET JOURNAL: Shell Plans Team Performance Bonus Scheme From January: “intended to help rebuild the company’s credibility.”

DOW JONES NEWSWIRES

Posted 30 August 04

LONDON — Royal Dutch/Shell (RD) confirmed Sunday plans to launch from January 2005 a company wide bonus scheme that places focus on team performance.

Shell confirmed a report that appeared in the Sunday Times.

“Multiple score cards will be replaced by single group score cards focusing on the execution of strategy, delivery of operational objectives and Enterprise First. Enterprise First addresses the importance of group needs over the needs of individuals or operating units,” said Shell spokeswoman Lisa Givert. “This is still subject to discussion but we will have new scorecards in place for the calendar year 2005 bonus schemes.”

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Royal Dutch/Shell to revise staff bonus scheme

Financial Times: Royal Dutch/Shell to revise staff bonus scheme: “The scandal prompted the resignation of three senior executives, investigations by US, UK and Dutch regulators, a criminal probe by the US Department of Justice and investor lawsuits.”

By Jonathan Moules

Published: August 30 2004

Royal Dutch/Shell, the oil company, is planning to revise its company-wide bonus scheme to create incentives for staff to look beyond their specific section of the business and focus on improving the entire company.

At the moment, staff at the Anglo-Dutch company are rewarded for both their individual performance and the success of their division.

However, under changes that are due to come into effect this January, the divisional element will be dropped and a bonus will be added based on the entire company’s performance.

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£17m Shell shock was just an early broadside in FSA war on abuse

The Guardian: £17m Shell shock was just an early broadside in FSA war on abuse

“Shell’s action was made more serious because false or misleading announcements on reserves were made from 1998 to 2003. Even though Shell had indications and warnings from 2000 to 2003 that figures for proved reserves were incorrect, its actions continued.”

Hector Sants

Monday August 30, 2004

A succession of recent investigations and financial penalties levied by the Financial Services Authority has put the term “market abuse” on the lips of many commentators and, if the reaction to the £17m fine imposed on Shell this week is any indication, on the minds of company directors.

One could be forgiven for believing market abuse was rife in the City. Is this an overreaction? After all, the UK financial markets are world leaders. Surely this wouldn’t be the case if market abuse was rife? Thankfully, market abuse is not widespread, partly because most practitioners are decent people but also because the FSA takes a tough stance with those who do play fast and loose with the rules, no matter how big or small.

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Shell boss pours oil on troubled water

The Times: Shell boss pours oil on troubled water

“the scathing reports, in which the FSA accused Shell of announcing false oil-reserve figures since as far back as 1998 again drove investors to rage that not enough was being done to restore credibility.”

August 29, 2004

Posted 30 August 04

In an exclusive interview, Jeroen van der Veer spells out his plans to appease investors and analysts to Lucinda Kemeny

AFTER 33 years at Royal Dutch/Shell, Jeroen van der Veer, chairman of the oil giant’s committee of managing directors, probably would not have chosen to mark his ascension to the top by signing off £82m in fines to two of the biggest financial regulators.

Last week’s settlement with Britain’s Financial Services Authority and America’s Security and Exchange Commission over charges that Shell misled the market about the true position of its oil reserves may have at least closed one chapter in the crisis that has enveloped the company.

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Daily Telegraph: Shell will abolish ‘discovery bonus’

Daily Telegraph: Shell will abolish ‘discovery bonus’

“Crisis-hit Shell is scrapping a controversial scheme which links staff pay levels to the amount of oil and gas employees find.”: “latest attempt by Shell to restore its reputation”

By Christopher Hope, Business Correspondent (Filed: 30/08/2004)

Crisis-hit Shell is scrapping a controversial scheme which links staff pay levels to the amount of oil and gas employees find.

Van der Veer: new scheme would encourage staff to think ‘enterprise first’ rather than ‘self first’

The news is the latest attempt by Shell to restore its reputation after its disastrous admission that it had exaggerated its “proven” oil and gas reserves by 23pc earlier this year.

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Auditors dragged into Shell lawsuit

The Scotsman: Auditors dragged into Shell lawsuit

“role of auditors KPMG and PricewaterhouseCoopers in the scandal that wiped £2.9 billion off Shell’s market capitalisation in one day.”

CATRINA STEWART

30 August 04

AUDITORS might find themselves implicated in the reserves scandal surrounding oil major Shell as lawyers leading US class actions against the company prepare to file an amended complaint.

Bernstein Liebhard & Lifshitz, the Wall-Street law firm leading the class action on behalf of individual investors, said that it was looking at the role of auditors KPMG and PricewaterhouseCoopers in the scandal that wiped £2.9 billion off Shell’s market capitalisation in one day.

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Shell knew of error in reserves in 1998

The Scotsman: Shell knew of error in reserves in 1998

“AUDITORS at Royal Dutch/Shell, the British-Dutch energy group, warned the company as early as 1998 that its reserves figures may have been overstated…”

CATRINA STEWART

Posted 30 August 04

AUDITORS at Royal Dutch/Shell, the British-Dutch energy group, warned the company as early as 1998 that its reserves figures may have been overstated, six years before executives admitted mistakes in public and two years earlier than previously reported by its own investigation into the reporting scandal.

Yesterday, US and UK regulators revealed that the oil giant has agreed to pay more than US$150 million (£83.7m) in penalties for providing “false and misleading” information, which led to a downwards revision of its proven reserves by 4.47 billion barrels.

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LNG promise seen to ward off oil price woes

Times of India: LNG promise seen to ward off oil price woes

“Scenario planners at Royal Dutch/Shell think that gas may surpass oil as the world’s most important energy source by 2025.”

AUGUST 27, 2004

Posted 28 August 04

Even as headlines scream about $50 a barrel oil, energy firms and their investors are becoming increasingly excited about its likeliest replacement: not wind nor wave nor solar power, but gasor, to be precise, gas that is frozen and transported as liquefied natural gas (LNG). This is expected to become as ubiquitous and crucial to the global economy as petroleum is today. Scenario planners at Royal Dutch/Shell think that gas may surpass oil as the world’s most important energy source by 2025.

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Sinopec, Shell Set Up Venture to Tap Retail Business in China

Bloomberg: Sinopec, Shell Set Up Venture to Tap Retail Business in China

Posted 29 August 04

Aug. 28 (Bloomberg) — China Petroleum & Chemical Corp., Asia’s largest oil refiner, said it formed a venture with Royal Dutch/Shell Group, Europe’s second-largest oil company, to operate 500 gasoline stations in China’s Jiangsu province and develop new outlets.

The venture, with total investment of 1.5 billion ($187 million), is 60 percent owned by China Petroleum, or known as Sinopec, the company said in a press statement. Shell’s two wholly owned units in China own the remaining 40 percent, it said.

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Oil finds fuel shareholders’ bid against Shell

Stuff.co.nz: Oil finds fuel shareholders’ bid against Shell

“to press their long-running $23 million insider trading case against Shell.”: “The High Court has already ruled the small shareholders had a case to take against Shell. That decision was upheld by the Appeal Court.”

29 August 2004

By GARRY SHEERAN

Spiralling oil share prices are spurring on shareholders in the former oil explorer Southern Petroleum to press their long-running $23 million insider trading case against Shell.

Shareholder spokesperson Tony Gavigan said he was confident they now had information to prove price-sensitive information was withheld from them during Fletcher Energy’s takeover of Southern Petroleum in 1995.

He said the new information emerged during a search of relevant documents as part of the legal “discovery” process in recent months.

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The Scotsman: Concerns over potential £3m windfall

The Scotsman: Concerns over potential £3m windfall

“Ensuing investigations by the US Securities and Exchanges Commission and the UK Financial Services Authority revealed that the oil major had been over-inflating its reserves since 1998, implicating the company’s top management in the scandal.”

CATRINA STEWART

Posted 29 August 2004

A CORPORATE governance watchdog has flagged concerns over share option rewards for disgraced Royal Dutch/Shell executives Sir Philip Watts and Walter van de Vijver.

Sir Philip and Van de Vijver, who resigned this year along with chief financial officer Judy Boynton over the reserves scandal at Shell, could reap windfalls of over £3 million apiece if the dual-listed company’s share price achieves certain levels, said the Pensions Investment Research Consultancy (Pirc) this week.

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Shell plans bonus to rally workforce

Sunday Times: Shell plans bonus to rally workforce

“some staff in the exploration and production division had oil-reserves replacement as one of the targets that determined their pay.”

Lucinda Kemeny

August 29, 2004

ROYAL DUTCH/SHELL, the embattled oil giant, intends to launch a new, company-wide bonus scheme from January as an incentive for staff to work together to rebuild the company’s credibility.

The plans are still subject to staff negotiation in some countries, but about 90,000 people are expected to be covered by the arrangements.

Jeroen van der Veer, chairman of the committee of managing directors, said he hoped it would encourage staff to think “enterprise first” rather than “self first”.

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Daily Express: FAT CATS REWARD: SIR PHILIP Watts

Daily Express: FAT CATS REWARD: SIR PHILIP Watts

His deputy, Dutchman Walter van der Vijver, repeatedly warned him of the overstatement and finally exploded in an angry e-mail last November that he was “sick and tired of lying about the extent of our reserves”.

Published 28 August 2004

Company: Shell

Payoff: £1m

Anglo-Dutch oil giant Shell shocked stock markets in January by admitting that it had overstated its proven gas and oil reserves by more than 20 per cent, the equivalent of a mind-boggling 4.47 billion barrels. Shell, long considered a safe haven by private investors and pension funds, saw £3bn wiped off its share value in the subsequent furore. Almost everybody with a pension will have been hit by the fallout.

Chairman Watts initially claimed he first heard about the shortfall at the end of 2003 but it was later reported that he was warned about the dangers in February 2002. His deputy, Dutchman Walter van der Vijver, repeatedly warned him of the overstatement and finally exploded in an angry e-mail last November that he was “sick and tired of lying about the extent of our reserves”.

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THE BUSINESS: Regulators must bring Shell directors to book

THE BUSINESS: Regulators must bring Shell directors to book

“a deliberate attempt by Shell, over a number of years, not just a few months, to overstate their oil and gas reserves.”

29/31 August 04

THE reports by Britain’s Financial Services Authority (FSA) and America’s Securities & Exchange Commission (SEC) into Shell’s overstating of reserves are far more damning than expected.

The two regulators conclude that there was intent to mislead on the part of Shell executives, some of whom, like former chief executive Sir Philip Wilts, have walked away with large payoffs.

So no simple arithmetical mistake, then. It was a deliberate attempt by Shell, over a number of years, not just a few months, to overstate their oil and gas reserves.

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The Observer: We all pay price for murky gas market

The Observer: We all pay price for murky gas market

“Shell’s £84 million fine for falsifying its gas and oil reserve statements”

Consumers should not accept higher bills, says energy watchdog Allan Asher, who calls for the EU to intervene

Sunday August 29, 2004

Last week saw one of the least auspicious days in the life of the energy market: Shell’s £84 million fine for falsifying its gas and oil reserve statements, price spikes for wholesale gas breaking the 50 per cent barrier, British Gas announcing the single biggest energy price rise since liberalisation, and Powergen’s £700,000 fine for, wrongly, preventing consumers switching to the company of their choice.

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Sunday Telegraph: Shell in Hell

Sunday Telegraph: Shell in Hell

29 August 2004

The oil giant has been heavily fined for overstating its reserves, but now looms the prospect of law suits against the individuals involved. Sylvia Pfeifer reports

The great and the good of the North Sea oil industry descended on the town of Stavanger in Norway last week for one of the sector’s annual get-togethers. But among the chief executives, politicians and royalty attending – Norway’s King Harald V opened the conference – there was only one man everyone wanted to see: Jeroen van der Veer.

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Shell’s auditors in firing line as US lawyers prepare class action

Sunday Telegraph: Shell’s auditors in firing line as US lawyers prepare class action

“Shell had ignored internal warnings for several years that it was overstating its reserves to maintain the appearance of having a strong oil and gas reserves base”

By Sylvia Pfeifer (Filed: 29/08/2004)

The US law firm leading class action lawsuits against Shell is considering targeting the oil giant’s external auditors, KPMG and PricewaterhouseCoopers, over their alleged role in the overbooking of reserves.

Stanley Bernstein, the senior partner with Bernstein Liebhard & Lifshitz, which is heading the class actions as “lead plaintiff” on behalf of investors, said that his firm was considering including the auditors when it files an amended complaint against Shell next month.

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Daily Mail: Alarm at former Shell chiefs’ options

Daily Mail: Alarm at former Shell chiefs’ options

“Pirc says Watts could make £3.1m if the shares reach 552p”: “Regulators are still investigating those believed to have had a role in the company’s reserves scandal.”

27 August 2004

Posted 28 August 04

OVERNANCE watchdog Pirc has given Shell investors something else to worry about after warning that ousted bosses Sir Philip Watts and Walter van de Vijver could collect hefty option gains on top of their massive pay-offs.

Pirc says Watts could make £3.1m if the shares reach 552p – below their 637p peak in 2001. Any option gains for Watts would be on top of his £1.05m pay-off and £584,000 pension. Shell shares rose 3 1/4p to 399 3/4p.

Van de Vijver needs a 70% share rise to put all his options in the money. Pirc says they would then be worth £3.6m, on top of his £2.57m pay-off and £260,000 pension.

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The Guardian: He’s no Hector

The Guardian: He’s no Hector

David Varney, executive chairman of Revenue and Customs: “Varney admits to being “very concerned” about seeing Shell immersed in a reserves scandal.”

Terry Macalister

Saturday August 28, 2004

David Varney is not anybody’s idea of a typical taxman, but from next week he will become the top public face of both the Inland Revenue and of the Customs people who search your car at Dover.

The state-educated south Londoner could not be further removed from bowler-hatted cartoon character Hector the Tax Inspector, who used to exhort us to get our end of year forms in. Relaxed and chirpy, the bearded 58-year-old is willing to comment on pretty much anything – including troubled Shell, where he worked for 28 years and is still viewed by some as a potential chairman.

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Buoyant E&P sector

Financial Times: Buoyant E&P sector

“Shell has a particular problem at the moment. It is running out of oil in the ground and has lost a chairman and faced public humiliation following surprise cuts in its oil reserve estimates earlier this year.”

Posted 28 August 04

From Antrim Energy, through Cairn Energy and Paladin Resources, to Tullow Oil and Venture Production, the 20 oil and gas exploration and production companies that represent about 97 per cent of the sector by capitalisation have increased in value by an average of about 70 per cent this year.

And the superlatives do not stop there. Canaccord Capital analyst Charlie Sharp points out that the E&P (exploration and production) index has outperformed the FTSE All-Share consistently over the past five years.

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Shell-shocked

Financial Times: Shell-shocked

“Shell was found to have “announced false or misleading reserves and reserves replacement ratios throughout the period 1998 to 2003″…: “three heads have rolled… other people in key positions during that time remain. They include Jeroen van der Veer… and Sir Mark Moody-Stuart”

By Jane Fuller

Published: August 28 2004 0

Speaking of oil companies, Royal Dutch/Shell endured another pasting from regulators this week.

We already knew it had been fined $120m by the US Securities and Exchange Commission and £17m by the Financial Services Authority for market abuse. But we had not been treated to the full reasons.

Shell was found to have “announced false or misleading reserves and reserves replacement ratios throughout the period 1998 to 2003”. While three heads have rolled for covering up or failing to act on this problem, other people in key positions during that time remain. They include Jeroen van der Veer, newly installed as chairman of the committee of managing directors, who has been an MD since 1997; and Sir Mark Moody-Stuart, who preceded the departed Phil Watts as chairman of the CMD and is still a non-executive director.

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FSA’s report accuses Shell of market abuse

The Times: That was the week: “FSA’s report accuses Shell of market abuse by announcing false oil reserves between 1998 and 2003, implicating several major executives in the scandal, including Sir Mark Moody-Stuart”

August 28, 2004

The Financial Services Authority says that the misreporting of a quarter of Shell’s oil and gas reserves was part of an attempt over several years to boost its poor exploration performance.

The FSA’s report accuses Shell of market abuse by announcing false oil reserves between 1998 and 2003, implicating several major executives in the scandal, including Sir Mark Moody-Stuart, former chairman of Shell’s committee of managing directors.

The FSA imposes a £17 million fine, the largest in its history, for misconduct amounting to market abuse.

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The landslide bringing down Shell grandees

FROM OUR AUGUST 2004 SHELL NEWS ARCHIVE

The Daily Telegraph: The landslide bringing down Shell grandees

The SEC and FSA reports, however, go back to the previous regime, when Sir Mark Moody-Stuart was chairman.”: Even Shell fell for the “group bonding” mumbo-jumbo, and he was videoed stumbling blindfold around head office during one such session, talking of his desire to “encourage the creativity of people” around him. He seems to have succeeded.”

(Filed: 28/08/2004)

The Securities & Exchange Commission has announced its intention to pin the reserves scandal on individuals, writes James Moore

The Shell Show, a tragicomedy in an unlimited number of parts, featured a powerful double act this week.

On Tuesday America’s Securities and Exchange Commission and the Financial Services Authority both gave the company a good kicking for wrongly booking billions of barrels of oil and gas reserves as “proven”.

Now Harold Degenhardt, the director of the Securities & Exchange Commission’s office in Fort Worth, Texas, is hard at work on the sequel. “What people need to focus on is that companies only act through people,” he says.

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Petrobras Executives Continue In Chile, Mulling Takeover

THE WALL STREET JOURNAL: Petrobras Executives Continue In Chile, Mulling Takeover

…considering an asset swap involving Petrobras upstream assets and Shell downstream operations, including service stations in Chile and Argentina and refining in the latter country.

DOW JONES NEWSWIRES

August 26, 2004 10:03 a.m.

SANTIAGO — Executives from Brazilian state energy company Petroleo Brasileiro (PBR) continue in Chile, meeting peers and mulling a possible asset purchase in the Andean country, one of only three South American countries in which it isn’t yet active and whose energy market is a declared target.

“Any commitment undertaken leading to the acquisition of any asset in Chile will be announced to the market and the shareholders at the appropriate time in accordance with the company’s disclosure practices,” the company said in a statement distributed from its Rio de Janeiro headquarters.

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Oil companies must be made to follow UN on human rights

The Independent: Oil companies must be made to follow UN on human rights

“Shell and BP the leaders in building a human rights responsibility into their business principles and recognising that explicit adherence to the Universal Declaration of Human Rights”

LETTER From Sir Geoffrey Chandler

United Kingdom; Aug 27, 2004

Sir: As oil prices reach new heights it would be as well to realise that stability of price and security of supply will be achieved not by the geographical diversification of sources, but by political justice and economic equity in the producing countries. Unfortunately it is the former course that consuming countries, with the US in the lead, appear to be pursuing.

Nearly 70 per cent of the world’s proven reserves of oil and gas lie in countries with poor human rights records. The growth of oil wealth has fuelled the ability of governments to invest in armaments and to transform small-scale corruption into personal or political gain on a scale hitherto undreamt of. The contrast between oil wealth and national poverty is nowhere more evident than in Angola and Equatorial Guinea, countries which may be considered secure from the turbulence of the Middle East.

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Managers look for the moral dimension: ‘Post-Enron, post-Shell, post-WorldCom, post-Parmalat’

Financial Times: Governance: Managers look for the moral dimension: ‘Post-Enron, post-Shell, post-WorldCom, post-Parmalat’

By Thomas Stewart

Posted 27 August 04

In a theatre lobby at intermission, I spotted a half-familiar face, looking at me with the “is that you?” expression people wear when they have not seen someone in a long time. He had worked for me 15 years earlier. He had left to accept a job in another city; I had changed employers, too. Since then he had married, had children and made a great success of his new job.

When I congratulated him and facetiously claimed credit for his achievements, he startled me by agreeing. He said: “You told me something that made an enormous difference in my life.” He repeated it – something about how he had strong organising skills – but I could not remember having said it.

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Shell Chairman responsible for Shell’s descent into cover-up, scandal and shame – Sir Mark Moody-Stuart

The Shell Chairman responsible for Shell’s descent into cover-up, scandal and shame on an epic scale – Sir Mark Moody-Stuart

By Alfred Donovan, 27 August 2004

(This article was written at the kind invitation of Mr Charles Wiwa, the nephew of Ken Saro-Wiwa, for publication in a US newsmagazine circulated to university students. Charles Wiwa is one of the parties in a U.S. Class Action lawsuit being brought against Shell in respect of its misdeeds in Nigeria.)

It is now confirmed by the reports by the U.S. Securities & Exchange Commission and the UK Financial Services Authority that the deception regarding Shell reserves started during the tenure of Shell Chairman Sir Mark Moody-Stuart. He is identified in many newspaper reports as being implicated in the reserves debacle. As will become obvious when reading this article, the news stories naming Moody-Stuart came as no surprise to me.

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Royal Dutch/Shell told to pay compensation

Financial Times: R Dutch/Shell told to pay compensation

“Nigeria accounts for about 10 per cent of Shell’s production but the company’s position is seen as increasingly precarious”

By Michael Peel, FT.com, Aug 26 2004 11:40

Nigeria’s Senate has ordered Royal Dutch/Shell, the oil company, to pay $1.5bn compensation for environmental damage allegedly caused by exploration and production in the violent and polluted Niger Delta region.

The call, which comes after a similar but still unenforced recommendation by a judicial panel set up by the parliament’s lower house last year, demands a $1bn payment by Shell “forthwith” for problems including “severe health hazards”, “economic hardship” and “avoidable deaths”.

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Irish Independent: Good addresses, interesting gamble

Irish Independent: Good addresses, interesting gamble

“When the oil price goes up the value of their reserves goes up, the share price goes up… and vice versa. However, Shell’s recent performance – where its reserves had to be written down and the oil giant was fined – turned that market truism on its head.”

Aug 26, 2004

THERE’S just no satisfying some investors/speculators. Undeterred by the collapse of the dotcom bubble, some risk-aware investors have been rediscovering oil companies in general and the exploration and production sector of the oil industry in particular.

Traditionally, the oil majors have been a pretty safe bet. When the oil price goes up the value of their reserves goes up, the share price goes up . . . and vice versa. However, Shell’s recent performance – where its reserves had to be written down and the oil giant was fined – turned that market truism on its head.

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The Guardian: Shell hit by $1.5bn Nigeria spill claim

The Guardian: Shell hit by $1.5bn Nigeria spill claim

Senate action on pollution adds to damage from reserves scandal

Terry Macalister

Thursday August 26, 2004

Shell has been hit by a $1.5bn (£840m) pollution claim from the Nigerian parliament 24 hours after being fined in Britain and the United States by financial regulators for “unprecedented misconduct”.

The latest bombshell was delivered by the Nigerian senate after it reviewed a compensation demand from the Ijaw tribe in the oil-rich Niger Delta.

Shell has been under fire in Nigeria for many years over its environmental record, which has been made worse by sabotage in the politically turbulent south of the country.

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Shareholders could be damaged beyond repair

The Times: Shareholders could be damaged beyond repair

“Several lawyers specialising in class actions on behalf of aggrieved investors are circling the Anglo-Dutch group, which is well within the orbit of American law.”

By Graham Searjeant

August 26, 2004

AMERICA’S Securities and Exchange Commission promises to deliver even more embarrassment to the corporate heart of Royal Dutch/Shell than to its London equivalent.

For shareholders, however, the agreement of fines and the switch in emphasis to errant individuals should be an enormous relief.

Other regulators can have their say, but the main damage is clear, quantifiable, done and over with.

Except that it isn’t. The unquantifiable peril for shareholders, the one that could wreck their investment, comes from themselves. Several lawyers specialising in class actions on behalf of aggrieved investors are circling the Anglo-Dutch group, which is well within the orbit of American law.

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Regulators dig deeper into Royal Dutch/Shell’s problems

Financial Times: Regulators dig deeper into Royal Dutch/Shell’s problems

“The SEC is scathing about Shell’s advice to investors that it had changed its mathematics, saying in its 1998 annual report only that estimation methods “have been refined”.

By Carola Hoyos, Adrian Michaels and Andrew Parker

Published: August 25 2004 03:00

Posted 26 August 04

US and UK regulators yesterday went several steps further than Royal Dutch/ Shell in their dissection of what went wrong at the oil group.

The Anglo-Dutch group had already presented in April the main findings of an internal investigation into its reserves debacle.

That report had been heavy on its criticism of dismissed senior executives – Walter van de Vijver, the former head of exploration, and Sir Philip Watts, former chairman. But it had been less fulsome on the detail of how the company had been engaged in accounting manoeuvres since 1997-98, including the administering of an internal audit function that was riddled with flaws.

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The misreporting scandal: Shell penalties ‘bolster’ “BILLION-DOLLAR” class action lawsuits

The Times: The misreporting scandal

Shell penalties ‘bolster’ “BILLION-DOLLAR” class action lawsuits

“A source close to the SEC told The Times last night that a list of questions had been sent to all Shell executives involved in the inquiry. It is understood that those questions have been passed to, among others, Sir Mark Moody-Stuart”

From James Doran, Wall Street Correspondent

August 26, 2004

BILLION-DOLLAR class action lawsuits against Shell will be bolstered by the company’s settlement with UK and US regulators over its oil reserves misreporting scandal, Wall Street lawyers said last night.

Melvyn Weiss, the senior partner of Milberg Weiss, said that the $150 million (£84 million) in fines imposed on Shell by the Securities and Exchange Commission (SEC) and the Financial Services Authority (FSA) on Tuesday “demonstrate that our allegations are well founded”. The New York law firm is claiming damages from Shell on behalf of the company’s employee pension fund.

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Shell hit by $1.5bn oil pollution claim from Nigerian Senate

The Independent: Shell hit by $1.5bn oil pollution claim from Nigerian Senate

“Shell was linked by international campaigners to the military government of Sani Abacha, which executed a delta activist, Ken Saro-Wiwa.”

Saeed Shah

United Kingdom; Aug 26, 2004

SHELL, THE beleaguered oil giant, has been asked to pay $1.5bn (pounds 830m) compensation by Nigeria’s Senate to communities affected by oil pollution in the country.

The resolution passed by the Senate, against the company’s Nigerian joint venture, Shell Petroleum Development Corp, was to compensate the Ijaw tribe in the southern Bayelsa state. SPDC has long been accused by activists of not cleaning up oil spillages and complicity in human rights abuses.

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