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July 15th, 2005:

Admission of troubles at Sakhalin-2 fuels fears Shell might miss targets

Financial Times: Admission of troubles at Sakhalin-2 fuels fears Shell might miss targets

“In a conference call with analysts and journalists, Shell executives said they had received an interim report that put the overall cost of the project at $20bn (£11.4bn) – about double the original estimate. They also said the project would not start deliveries of the super-cooled natural gas until summer 2008, at least eight months later than planned.”: “The news revived fears that Shell would be unable to meet its targets to produce an average of 3.8m-4m barrels of oil equivalent a day by 2009.”

Friday 14 July 2005

By Thomas Catan

Published: July 15 2005

Perched on a remote island off the east coast of Russia, Sakhalin-2 has long been cited as the sort of difficult and large-scale project that would help Royal Dutch/Shell turn round its flagging oil and gas production.

The liquefied natural gas project was seen as a bright spot for the world’s number-three oil company after a humbling year in which it had to slash its reserves of oil and gas five times.

Yesterday, however, the company confirmed rumours that its flagship project was running behind schedule and was badly over-budget. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

THE WALL STREET JOURNAL: Shell’s Costs Soar For Russia Project

THE WALL STREET JOURNAL: Shell’s Costs Soar For Russia Project

“In a potentially big setback to its turnaround attempt, Royal Dutch/Shell Group disclosed a $10 billion cost overrun and delays at an important Russian energy project…”: “The Sakhalin delay is particularly bad news for Shell. The company last year was rocked by a scandal after it emerged that it had overstated its reserves of oil and natural gas following years of subpar performance at finding new resources”

Friday 15 July 2005

Price Tag of Sakhalin II

May Double to $20 Billion;

Half-Year Delay Expected

By BHUSHAN BAHREE and BENOÎT FAUCON

Staff Reporters of THE WALL STREET JOURNAL

July 15, 2005; Page B2

In a potentially big setback to its turnaround attempt, Royal Dutch/Shell Group disclosed a $10 billion cost overrun and delays at an important Russian energy project, becoming the latest victim of soaring development costs for the oil industry’s increasingly ambitious projects.

Shell said costs in the second phase of the massive Sakhalin II natural-gas project, which it is spearheading, may double to $20 billion, and it expects the project to be delayed by half a year. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

THE WALL STREET JOURNAL: Venezuela Steps Up Tax Actions on Oil Firms

THE WALL STREET JOURNAL: Venezuela Steps Up Tax Actions on Oil Firms

“Venezuelan tax authority Seniat ordered oil company Royal Dutch/Shell Group to pay nearly $131 million in back taxes it said the company owed.”:

Friday 15 July 2005

A WALL STREET JOURNAL ONLINE NEWS ROUNDUP

July 15, 2005; Page A8

CARACAS, Venezuela — Venezuelan tax authority Seniat ordered oil company Royal Dutch/Shell Group to pay nearly $131 million in back taxes it said the company owed.

Seniat also seized a number of documents from the offices of U.S. oil company Chevron Corp., saying the company had failed to produce the information on request. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Daily Telegraph: Shell admits cost of flagship Russian oilfield rises to £11bn

Daily Telegraph: Shell admits cost of flagship Russian oilfield rises to £11bn

“It is the second time in recent memory that the oil company has surprised its investors, after admitting last year that it had overstated its reserves by more than 40pc.”

Friday 15 July 2005

By Malcolm Moore (Filed: 15/07/2005)

Shell yesterday admitted that the cost of its flagship project on Sakhalin Island in Russia had doubled to about $20billion (£11.5billion).

Jeroen van der Veer, chief executive of the oil major, said that he had been told on Wednesday there were “further significant cost overruns” and that he felt announcement had to be made in line with the policy to be “fully transparent”.

Shell has faced protests from environmentalists read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

THE TIMES: Shell forced to admit Russian costs have doubled

THE TIMES: Shell forced to admit Russian costs have doubled

“The doubling of costs and an anticipated half-year delay to the construction schedule is a blow to Shell’s reputation as a project manager and it will lead to further embarrassment with Shell’s partners, including Gazprom, the Japanese investors Mitsui and Mitsubishi, and the Russian Government.”

Friday 15 July 2005

By Carl Mortished, International Business Editor

SHELL has been forced to admit that the cost of Sakhalin Energy, a vast liquefied natural gas project in Eastern Siberia and a pillar of the company’s future expansion, has ballooned from $10 billion to $20 billion (£11.4 billion).

The doubling of costs and an anticipated half-year delay to the construction schedule is a blow to Shell’s reputation as a project manager and it will lead to further embarrassment with Shell’s partners, including Gazprom, the Japanese investors Mitsui and Mitsubishi, and the Russian Government. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Shell’s Sakhalin-2 gas project hit by eight-month delay and $10bn cost rise

Financial Times: Shell’s Sakhalin-2 gas project hit by eight-month delay and $10bn cost rise

Friday 15 July 2005

By Thomas Catan in London

Published: July 15 2005

Royal Dutch/Shell, the Anglo-Dutch energy giant, yesterday said its flagship Russian gas project would be delayed by at least eight months and cost $20bn (£11.4bn) – twice the original estimate.

The giant Sakhalin-2 liquefied natural gas project off the east coast of Russia has been beset by a range of problems, the company said, including the rising cost of raw materials, a shortage of contractors, Russian inflation and currency exchange rate fluctuations. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Guardian: Shell shock

The Guardian (UK): Shell shock

“Now we learn that it has encountered cost overruns at its Russian gas project Sakhalin-2 and will have to look again at figures for upcoming capital expenditure. We all know about builders’ estimates but Shell has now discovered that its figures are “out” to the tune of $10bn.”

Friday July 15, 2005

Things almost seemed to be swell again for Shell. The soaraway oil price has helped to smudge memories of last year’s reserves over-statement scandal. Board unification proceeded as planned and the company also began to get its public relations into some sort of order: wheeling Lord Oxburgh out to argue for action on climate change, for instance.

Now we learn that it has encountered cost overruns at its Russian gas project Sakhalin-2 and will have to look again at figures for upcoming capital expenditure. We all know about builders’ estimates but Shell has now discovered that its figures are “out” to the tune of $10bn. What are they building in Russia? The east coast mainline? read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

THE NEW YORK TIMES: Shell, Chevron in Venezuelan Tax Probe

THE NEW YORK TIMES: Shell, Chevron in Venezuelan Tax Probe

“Venezuela on Thursday ordered international oil major Shell to pay nearly $131 million in back taxes, and also confiscated financial data from U.S.-based Chevron Corp. in a tax crackdown.

Posted Friday 15 July 2005

By REUTERS

CARACAS, Venezuela (Reuters) – Venezuela on Thursday ordered international oil major Shell (RD.AS)(SHEL.L) to pay nearly $131 million in back taxes, and also confiscated financial data from U.S.-based Chevron Corp. (CVX.N) in a tax crackdown.

The actions announced by national tax authority SENIAT against the two foreign oil companies formed part of a campaign by left-wing President Hugo Chavez’s government to tighten control over Venezuela’s strategic oil sector. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Irish Times: Minister accused of excluding risk from safety review

Irish Times: Minister accused of excluding risk from safety review

“The five north Mayo men who are still in prison over their opposition to the Shell Corrib gas pipeline have accused Minister for the Marine Noel Dempsey of “deliberately excluding” the risk of rupture and explosion from his new safety review.”

Friday 15 July 2005

Lorna Siggins, Marine Correspondent

Jul 15, 2005

The five north Mayo men who are still in prison over their opposition to the Shell Corrib gas pipeline have accused Minister for the Marine Noel Dempsey of “deliberately excluding” the risk of rupture and explosion from his new safety review.

The impact of such risk on the safety of residents in the area represented “a core issue”, the five men have said in a statement released from Cloverhill Prison in Dublin through Mayo TD Dr Jerry Cowley (Ind). Any review which did not include it was “not acceptable”, they said. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Business World (Ireland) Ion Equity consortium buys Irish Shell

Business World (Ireland) Ion Equity consortium buys Irish Shell

“A consortium led by venture capital firm Ion Equity has acquired Shell’s businesses in Ireland. The financial terms of the deal were not disclosed, but the company will continue to trade as Shell in Ireland.”

Friday 15 July 2005

(BizWorld)

A consortium led by venture capital firm Ion Equity has acquired Shell’s businesses in Ireland.

The financial terms of the deal were not disclosed, but the company will continue to trade as Shell in Ireland.

Irish Shell owns six oil importation facilities in Dublin, Cork, Limerick, Galway, Derry and Greenore; 35 local distribution depots geographically spread across Ireland; 55 retail service stations and also supplies 105 independently-owned service stations.

It sells gas oil, diesel, kerosene, fuel oil and lubricants into all sectors of the market, both directly and through a countrywide network of authorised distributors. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Reuters: Gazprom says Shell’s cost hike hits asset swap plan

Reuters: Gazprom says Shell’s cost hike hits asset swap plan

Friday July 15, 2005

MOSCOW, July 15 (Reuters) – Russian gas monopoly Gazprom said on Friday it was considering Shell’s assets on Sakhalin as less expensive after the oil major doubled the project’s cost estimates this week to $20 billion.

Earlier this month, Gazprom agreed to swap a 50 percent stake in a Siberian gas field for a 25 percent stake in the Shell-led giant liquefied natural gas project in Russia’s Far East.

On Thursday, Shell said it was not only increasing the cost estimate for Sakhalin, but also postponing the first LNG shipment from the end of 2007 to summer 2008. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Independent: Sakhalin pipeline $10bn over budget

The Independent: Sakhalin pipeline $10bn over budget

“Shell, the troubled oil giant, revealed yesterday that the costs of building its controversial Sakhalin gas project in Russia had shot $10bn (£5.7bn) over budget.”

By Philip Thornton

Published: 15 July 2005

Shell, the troubled oil giant, revealed yesterday that the costs of building its controversial Sakhalin gas project in Russia had shot $10bn (£5.7bn) over budget.

It said soaring metal prices, higher contractor fees and the fall in the dollar could double costs of the second phase to $20bn. In a further blow, Shell pushed back the date of the first deliveries of liquefied natural gas (LNG) from Sakhalin II to the summer of 2008 from November 2007. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.
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