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SHELL COMMITTEE OF MANAGING DIRECTORS MINUTES OF THE MEETING HELD IN LONDON ON MONDAY, 22 AND TUESDAY, 23 JULY 2002

By Alfred and John Donovan
Tuesday 13 November 2007

The Shell Group Managing Directors present at the CMD Meeting held on 22 & 23 July 2002 included Philip Watts, Jeroen van der Veer, Paul Skinner (part time), Walter van de Vijver and Malcolm Brinded. Judy Boynton was also present. Other Shell Executives in attendance at various times included Linda Cook, Lynn Elsenhans, Lorin Brass, James Smith, Din Megat and Dominique Gardy. Keith Ruddock acted as Secretary to the Committee.

Every page of the minutes was marked “MOST CONFIDENTIAL” because the discussions covered Shell’s commercially sensitive plans. There is a considerable amount of interesting information. We will comment on just a few issues.

THE CORRIB PROJECT IN IRELAND

During the meeting it was disclosed that planning consent had been refused for a terminal relating to the Corrib field:-

“The Committee queried whether the Group had sufficiently well placed contacts with the Irish government and regulators. Paul Skinner undertook to explore this issue further in consultation with the Country Chairman in Ireland.”

In other words, Shell intended to use its influence to overcome the planning refusal. That snippet is likely to firm up a lot of suspicions among members of the Shell to Sea Campaign about the dubiously close relationship between Shell and the Irish authorities. An environmentally unacceptable project was foisted on the Irish people. It resulted in the jailing of the “Rossport Five”. The suspicion has remained that the ambitions of a ruthless oil giant with deep pockets took precedence over the best interest of ordinary Irish citizens. The fact that members of the Irish government have a track record linked to corruption and that two of the Shell Group Managing Directors involved in the CMD meetings were subsequently forced to resign after a major fraud will only heighten such suspicion. The minutes reflect what was deemed appropriate to record in writing, not necessarily everything discussed.

Aggressive negotiating tactics were evident in the discussion about the Sakhalin-2 project.

The minutes record that: –

“If necessary Senior Group representation should put the Japanese stakeholders under pressure to make commitments to the project in order to progress it in the interest of Japan.”

(They really meant the best interest of Shell)

“The Committee noted that in three months time it may tactically be desirable to put the project on hold to concentrate the attention of potential customers.”

FT Articles

The Committee went on to express concern about articles published by the Financial Times in July 2002 relating to the activities of a Shell employee, George Naumur. The following is an extract from one of the two FT articles published on July 15, 2002.

Oil major Shell slid 8.1 per cent after The Financial Times reported concerns over the accounting treatment of its energy trading derivatives. George Naumur, a former general manager at Shell’s Houston operation alleges that he was told to come up with optimistic forecasts of future power and gas prices that would justify the derivatives deals. Shell insisted that the accounting treatment of the deals was “conservative”.

http://royaldutchshellplc.com/2002/07/15/ftcom-site-european-bourses-close-at-multi-year-lows/

http://royaldutchshellplc.com/2002/07/15/ftcom-site-ftse-down-as-oil-losses-offset-telecoms-gains/

The Committee noted:-

“… in the post Enron and Worldcom climate, former employees with grudges were now being taken very seriously in any allegations they may make about their former employers.” 

“The Committee also noted that in the current climate… it might have been preferable to have fielded someone other than Debbie Wernet for the interview, given her Enron background.”

Three points:

(1)Shell has now joined the ranks of once highly respected global brands ruined by scandal and spoken about with disdain in the manner Shell referred to Enron.

(2) Shell has certainly taken the allegations of former Shell geologist Dr John Huong very seriously, with EIGHT Royal Dutch Shell companies ganging up to bury him in multiple High Court injunctions in relation to articles published on the so called anti-Shell website: www.royaldutchshellplc.com.

(3) Debbie Wernet will likely consult with her lawyers when the CMD comment is brought to her attention.

RESERVES OUTLOOK

It is interesting to note in the light of subsequent events the discussion over reserves “over-bookings”, particular bearing in mind the presence of Jeroen van der Veer, a man said to have an exceptionally good memory, yet who claims not to recollect any early warning signals about the reserves scandal.

It is ironic to note that the reserves discussion concluded on the basis that “high transparency needs to be maintained… on the existing booked reserves…”

That ambition was not entirely met.

THE MINUTES:

http://www.shellnews.net/classactiondocs/403_2.pdf

The minutes for a more recent Royal Dutch Shell CMD Meeting will be published on Wednesday 14 November 2007.

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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