This post was written by johnadonovan on 18 July, 2007 (16:45)
By John Donovan
When the news media reports on rising high oil prices, militant attacks in Nigeria are inevitably cited as a factor e.g. the following extract is from a report in The Scotsman, Friday 13 July 2007: The attacks have contributed to a drop in production of about 25 per cent, driving up oil prices worldwide with no end to the kidnappings in sight.
Shell is the leading oil producer in Nigeria. To the outside world it appears to be an unfortunate victim of regular attacks by militants on its employees, pipelines and installations which drive up the price of oil. As readers will see, the truth is more sinister and bizarre.
As the operators of what has been described by the Financial Times as âan anti-Shell website, we were contacted by a conscience driven high level Shell insider who gave us clues about Shell’s actions in Nigeria. They made it clear their life would be at risk in going too far in revealing the truth about issues relating to Shell, including Nigerian politics, bunkering, pollution, kidnapping, MOSOP (Movement for the Survival of the Ogoni People) and the militant activist organisation MEND (Movement for the Emancipation of the Nigerian Delta). We put questions to the whistleblower and subsequently spoke directly to them. In the process, we established that the source is authentic.
The following articles by The Financial Times found during our research into the charges against Shell confirm, to a large degree, what had appeared initially to be incredible and outlandish allegations.
Our investigations included contact with other Shell insiders with knowledge of Shell activities in Nigeria.
Based on the FT articles and information from our sources, we are able to state as a matter of fact, that Shell executives in Nigeria (where corruption is endemic) have been up to their necks in a sinister relationship with militant leaders. Valuable contracts have been awarded by Shell to militants. Shell executives, Nigerian authorities and militant leaders have been locked in a conspiratorial embrace.
Shell would presumably say that their descent into an immoral commercial relationship with militants attacking oil company property and kidnapping oil company employees, has had the positive objective of keeping the oil flowing. In our view such unscrupulous dealings are reprehensible and probably hide an even darker secret.
The plain fact is that there is much more money to be made by stemming oil flow from Nigeria than keeping it flowing. Production cuts have been consistently happening. This has been most fortunate for Shell, which has benefited from billions in windfall profits that have masked the huge losses arising from Shell management incompetence in mega projects such as Sakhalin-2 in Russia. We cannot categorically say that this has been Shell’s real objective: instead it comes under the heading of informed speculation.
In 2004, the world was astonished to discover that Shell had artificially inflated its hydrocarbon reserves in a huge securities fraud. Some of the same directors who signed Form F20 returns containing false information filed with the U.S. Securities & Exchange Commission remain at the helm of Shell. The question now is whether Shell has also been inflating profits by manipulating oil production in Nigeria in cahoots with murderous militant partners and perhaps as an unwanted by-product, has also created massive windfall profits for its competitors. I stress again that it only takes a small crimp in the oil pipeline applied on a regular basis to drive up the global oil price and keep it at a high level, thereby generating billions of extra dollars in annual profits: in the case of Shell alone, $25.4 billion.
By way of background information I co-own with my father, Alfred Donovan, the world’s leading online source of information about Royal Dutch Shell. We have a library of over 15,000 articles relating to Shell. Our website has a track record of exposing misdeeds by Shell management as a result of insiders leaking information to us. The Russian government has confirmed that I supplied the evidence for a threatened $30 billion lawsuit against Shell relating to environmental violations on the Sakhalin Energy project in Siberia. In December last year Shell surrendered its majority stake in the venture to bring the episode to an end. http://www.prospect-magazine.co.uk/article_details.php?id=8209
A few weeks ago, David Greer, a Shell Managing Director seconded to the Sakhalin-2 project, resigned as Deputy Chief Executive of Sakhalin Energy following our exposure in conjunction with the Financial Times, of a scandal which emerged from insider information leaked to me.
Many news organizations such as Dow Jones and Reuters have used information leaked to us by our Shell insider sources. Eminent energy journalists such as Ed Crooks of the Financial Times and Max Delany of The Moscow Times have written front page stories based on information and leaked documents supplied to us from Shell insiders. For this reason the credibility of our Shell insider sources is extremely high.
Moscow Times articles:
Further information about us and our website can be found on the Wikipedia article: http://en.wikipedia.org/wiki/Royaldutchshellplc.com
The Wikipedia article “Controversies surrounding Royal Dutch Shell” conclusively answers the question of whether Shell management is capable of ruthless unscrupulous conduct. The article details Shell’s fines for fictitious trading, its leadership role in illegal cartels, involvement in espionage activities in Nigeria and covers many other subjects.
Senior executives of Royal Dutch Shell Plc, including Shell Oil Company President John Hofmeister and the Chairman of Shell in Nigeria have had advance sight of this article.