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Retired Shell Global Chief Petroleum Engineer Iain Percival speaks out

By Iain Percival

Subject: Shell Petroleum Engineering

I have been enjoying the delights of my home in the Scottish Highlands for a few weeks without the “benefits” of  internet connection and have only now caught up with the news / comments on the site.

“Insider” posted a message on 23 September asking me if I was about to change my mind with respect to the technical capability of petroleum engineering within Shell. Of course I have an opinion. Those who know me from my long career with Shell would be surprised if I did not! Of course my opinion does not count for much; I am now “ex-Shell” and nothing is more true than the comment made by a political commentator the day after the departure of Margaret Thatcher when asked what she would have thought. His reply was “She’s cold potatoes now”.

I remain totally confident in the capability of individual petroleum engineers in Shell. In fact, for what it is worth, that confidence extends to the entire community of genuine technical professionals in the company. However, I do have an issue with the new approach to Petroleum Engineering functional leadership.

The function has a new leader to replace Roelof Platenkamp who in turn replaced me. However, in contrast with the full time position filled by Roelof and myself, the new man will “double hat” as PE functional leader and VP Front End Studies Europe, Middle East, Africa in the Global Solutions Upstream organisation. This has not been done with the wells community for example where there is a true global functional head in the person of Peter Sharpe. In addition, I was most surprised to learn that the new incumbent of petroleum functional leadership is a relatively recent newcomer to Shell (formerly XOM) with a strong exploration background. I do admit however to knowing nothing at all of the abilities of the gentleman in question (Glen Daley); he joined Shell just before I retired in 2006. I shared my concerns with Matthias Bichsel and Malcolm Brinded and to his credit, Matthias replied almost by return. He thanked me for my continuing interest in the company but in essence he maintained that the way Roelof and I had led the function had given rise to isolation with a focus on process and technical excellence but to the detriment of integration with wells and engineering in pursuit of robust projects. However, nothing could be further from the truth. Roelof and I were clear on the criticality of close iterative and integrated working across all the functions (including production operations) in order to maximise full field life cycle value. I believe what has happened concerns the personalities and prejudices of the leadership of the former EP Solutions, i.e. the subsurface study entity spread over Rijswijk, Aberdeen, Houston and Bangalore in the period 2003 until mid 2009. The view strongly held was that EP Solutions was the natural home for functional leadership in addition to petroleum geosciences / petroleum engineering / development planning excellence. John Darley (a petroleum engineer through and through) and the predecessor to Matthias did not share this view but with his departure this “wisdom” resonated with Matthias as I presume it would given shared exploration background and the “bonding” of shared membership of the Petroleum Development Oman leadership team.

In answer then to the question from Insider, I believe the reorganisation as it impacts the petroleum engineering function / community to be a retrograde step. The message is loud and clear  with the appointment of 3 non petroleum engineers to the 3 Front End Studies Groups in Rijswijk, Houston and Bangalore – (i) there is no senior home grown petroleum engineer in Shell capable of leading the community, (ii) a “single hat” leadership role cannot be justified. I am in receipt of much comment from petroleum engineers both long in the company and not so long (I keep in touch with many and still mentor more than a few) and the general reaction is one of dismay.

In the enjoyable and satisfying consulting work I have pursued since retirement from Shell, I have found acceptance and indeed promotion of the need for strong distinct functional excellence – especially in the domain of petroleum engineering. As the head of petroleum engineering in a successful NOC put it to me “if you are not totally on top of and really push your understanding of the physics and chemistry of the rocks and fluids in addition to a real knowledge of lithological spatial relationships in the sub surface – how can you claim to be an industry leader especially in an era of increasing focus on IOR / EOR?” Precisely!

It has given me just so much satisfaction to be invited by a growing number of significant players in the business to advise on the architecture of functional technical excellence. The satisfaction is tempered however by the disappointment of what appears to be a different approach in the company where I learned so much. Since retirement I have continued to be an active ambassador for Shell – in particular for the practice of functional & discipline excellence since its reintroduction in the early 2000’s (after the dreadful mistake of abandonment in 1995). However, I feel I can no longer speak to students at home and abroad with the same conviction and acted accordingly with SPE Young Professionals and students at Offshore Europe in early September. I am prepared of course to be convinced otherwise.

In conclusion let me wish the community and Glen well. As I have stated several times on this site, Shell is staffed with competent, dedicated technical professionals whose only wish is to do a good job for the business, to have their efforts recognised and to be well led. What none of us who wish Shell well want is an echo of the observation of a German general in the first world war in respect to lions and donkeys in the British army.

Article Ends (Text highlighting in red by royaldutchshellplc.com not by Iain Percival)

The following information, links and photograph of Iain Percival are all sourced from the Internet. They were not supplied or suggested by him.

Iain Recognised for Mentoring Work

Shell retiree and former Group Chief Petroleum Engineer, Iain Percival, took the award for Outstanding Individual Achievement at the Energy Industry (EI) Annual Awards, for his work mentoring a number of young professionals, both in Shell and other organisations.

Iain is currently spending time with students and staff at RGU and the University of Aberdeen, and visits schools in his home area of the north of Scotland. Iain retired from Shell in 2006 after 33 years of service.

Iain remarked, “It is an honour I appreciate but of course I do derive a great deal of personal satisfaction from my activities.”

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Comment on Article by “dutchdude”

on Oct 10th, 2009 at 7:24 am

Iain’s article captures not only the PE community’s concerns. I wish we had such a strong advocate and champion in my discipline. Unfortunately in my area you only make promotion and VP jobs if you know how to handle mirrors and blow white smoke (and of course the creative adaptation of definitions also helps ..). When vd Veer told the investment community that the Reserve issue was the only optimistic reporting problem in Shell, I couldn’t stop laughing for two days! Anywhere you look in Shell there is “optimistic” reporting, in HR, IT and of course HSE!

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