News and information on Royal Dutch Shell Plc.
Daily Mail
17 March 2010, 8:11am
Linda Cook, the former head of Shell’s oil and gas division, received a £5m compensation payment after losing out on the role of chief executive to Peter Voser.
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| Compensation: Linda Cook |
The revelation came in the firm’s annual report and will overshadow a well received strategy update by Voser.
His earnings were £2.9m last year.
By Will Kennedy and Andrea Catherwood
March 17 (Bloomberg) — Royal Dutch Shell Plc Chief Executive Officer Peter Voser said industry costs have started to rise and the company will use technology to control spending as it invests $100 billion to boost production.
“Costs have not come down as much as we hoped for, and some of them are now rising again,” Voser said in an interview with Bloomberg Television broadcast today. Shell’s challenge is to be “more speedy in terms of technology implementation.”
Shell, vying with BP Plc as Europe’s biggest oil company, said yesterday it’s assessing more than 35 projects to keep production rising until 2020. Australia, where the company is developing offshore and coal-seam gas reserves, may attract as much as 40 percent of Shell’s capital expenditure. It has higher wage rates than other countries where the company operates.
“In Australia, we are doing floating LNG, which is actually fabricated in Korea, so we will be less exposed to the labor costs,” Voser said in London. We need to do “things differently in the future so that you actually save costs and get things built cheaper.”
Crude prices doubled to more than $80 a barrel in the past year, prompting producers to resume projects put on hold during the recession. Oil and gas industry spending will rise 11 percent this year to $439 billion, according to Barclays Capital. Increased investment may start to reverse reductions in drilling and engineering costs caused by the global slowdown.
Raise Production
Voser, speaking to analysts at the company’s annual strategy briefing, outlined plans to raise oil and gas production 11 percent by 2012 to 3.5 million barrels a day. The company’s capital expenditure, set at $28 billion this year, will be between $25 billion and $27 billion from 2011 to 2014.
Investment in production will be focused on three main areas, Voser said in the interview. These are Australia, the Gulf of Mexico and so-called tight gas in the U.S., where recently developed drilling techniques are used to access resources trapped between rocks.
“On top of that we have other projects in areas like Kazakhstan, like Nigeria, in the Middle East we have Iraq,” he said. “We have got a vast set of opportunities. I’m very pleased with the variety we have in the portfolio, so if one doesn’t come, we’ve got others to replace those.”
Shell yesterday announced plans to cut staff by a further 1,000 people, making the overall reduction of 7,000 in the three years through 2011. Voser has said he will cut costs by $1 billion this year, after reducing them by $2 billion last year.
The company plans to sell filling stations and oil refineries to free up capital for production spending. Shell is negotiating with India’s Essar Oil Ltd. to sell three European plants after the recession cut fuel-processing profits.
“You need bigger refineries, more complex refineries, because they can withstand recessions better than smaller refineries,” Voser said.
To contact the reporters on this story: Will Kennedy in London at wkennedy3@bloomberg.net; Andrea Catherwood in London at acatherwood@bloomberg.net.
Last Updated: March 17, 2010 05:09 EDT
Daily Telegraph: Royal Dutch Shell has unveiled the most dramatic overhaul of its business in recent memory, outlining plans to exit more than a third of its 90 retail markets, slash refining capacity and return to growth after seven years of falling output.By Garry White
Published: 10:10PM GMT 16 Mar 2010
Peter Voser, chief executive, unveiled a further 1,000 jobs cuts in addition to the 6,000 already announced as he vowed to “sharpen up” Shell in the next three years by boosting output by 11pc.
“Shell has been disadvantaged recently, due to our higher exposure to refining and natural gas, where margins are hard-wired to the economy,” Mr Voser said.
“The priorities are for a more competitive performance, for growth, and for sharper delivery of strategy. We have more to do to drive out cost and improve the operating performance in the company.”
Shell plans to exit 35pc of its petrol station markets and reduce refining capacity by 15pc to help it make cost saving of $1bn (£658m) this year. It also said it would sell non-core assets worth $1bn-$3bn a year, including its refineries in Gothenburg, Los Angeles and New Zealand.
Monday is the deadline for bids for the company’s liquified petroleum gas distribution arm, which could raise £1.1bn. Those understood to be tabling offers include Brazilian chemicals group Ultrapar, Centrica spin-off DCC and French listed Rubis, as well as a number of private equity groups.
“Upstream, we have built up strong foundations in activities like gas-to-liquids, oil sands and liquefied natural gas,” Mr Voser said. “Looking out to 2020, I expect Shell’s exploration to underpin new upstream growth, especially in North America and Australia, with additional barrels from development-led projects.”
The news came on the day that Shell released its annual report, which showed that Mr Voser earned less than Tony Hayward, chief executive of rival BP, in 2009. Mr Voser earned a total salary and bonus of £2.8m compared with Mr Hayward’s £4m.
Shell has said it would freeze management salaries until 2011 after shareholders objected last year when executives were awarded bonuses even after performance targets were missed.
Linda Cook, who resigned as head of Shell’s gas and power business in May last year, was paid a salary and bonus of £2.1m as well as a severance payment of almost €5.5m (£5m). She leaves with a total pension pot of just under $25m. Mr Voser’s predecessor, Jeroen van der Veer, left with a pension pot worth $34.2m.
Shell predicts oil will trade between $50 and $90 a barrel over the next few years and is targeting output of 3.5m barrels of oil equivalent per day in 2012. This compares to 3.15m in 2009, the equivalent to an annual growth rate of 3.5pc, or 11pc in total over three years
Mr Voser said the company should be in a surplus cash flow position in 2012, after capital investment and dividend payments – assuming $60 oil prices and a more normal environment for natural gas prices and downstream. In order to achieve this it will have to invest between $25bn and $27 a year in its operations.
The Anglo Dutch group also said that it replaced 288pc of its oil and gas output with new discoveries in 2009, or 3.42bn barrels of oil equivalent.
RELATED TELEGRAPH ARTICLES
By John Donovan
On 31 March, Richard Wiseman, the Chief Ethics & Compliance Officer of Royal Dutch Shell Plc will be making a speech at a seminar in London: “Best Practice in Combating Corruption Extortion and Bribery“
“The event will examine new developments and tools in fighting corruption and providing practical methods for addressing and investigating extortion and bribery.”
We can only surmise that Mr Wiseman is present on the basis of being a poacher turned gamekeeper.
When he was Legal Director of Shell UK Limited we brought to his attention irrefutable evidence of corrupt practices inside Shell. A Shell executive on the make had plotted with colleagues on how to deceive companies participating in what they foolishly thought was an honest tender process for a major Shell contract. The companies in question were enticed into confidentiality agreements under false pretenses, so that Shell could steal intellectual property from them and prevent them offering it to rival oil companies.
The contract was eventually given to a company which never took part in the tender. A company with whom the Shell executive had a close personal relationship. Evidence shows that he had an offshore bank account and had recorded in his diary a devious plan to set up his own business inside Shell and then retire from the company at the age of 35.
We also brought the extensive documentary evidence of this ruthless conspiracy to the attention of all directors of Shell UK, Shell Transport and Royal Dutch Petroleum. We invited Malcolm Brinded to disassociate himself from the thoroughly dishonest Shell executive in question. Instead of doing so, Shell senior management, including Wiseman, gave him its full backing.
It is therefore the height of hypocrisy that Wiseman was appointed to his current position and even more outrageous that he has the audacity to make another speech on the subject – unless he is giving tips on predatory conduct against small companies lulled into a false sense of security by sham business principles.
By Keith Findlay
Published: 17/03/2010
It emerged yesterday that a further 1,000 positions globally are going, on top of the 5,000 shed in 2009 and 1,000 the firm had previously flagged up for this year.
Shell would not say exactly where the latest cuts in its 101,000-strong worldwide workforce would be, but chief executive Peter Voser said the axe would fall mainly on downstream and corporate roles.
Aberdeen, where Shell employs about 1,800 people, is the hub for the firm’s UK upstream – exploration and production – activities and is, therefore, unlikely to see much of an impact.
But about 8,500 Shell UK workers have been left wondering if the latest round of redundancies will be the last.
Jake Molloy, north-east spokesman for the National Union of Rail, Maritime and Transport Workers, said contractors working offshore were also getting increasingly nervous.
“They are receiving mixed messages of what the future holds for them. There is no clarity at all from Shell right now.”
The company is selling a range of assets in the UK and overseas to help to meet the cost of its £18billion capital spending programme this year.
Earlier this month, it revealed it was looking for a buyer for the Anasuria floating production vessel in the central North Sea plus stakes in associated fields.
Yesterday’s move is part of “firm plans” for about £660million of savings in 2010 and 2,000 job cuts by the end of 2011, including the 1,000 that were announced in February as Shell posted a 69% plunge in annual profits, to £6.1billion.
Also in February, Shell said it had frozen salaries for top bosses to show “appropriate restraint in the current economic environment”.
Mr Voser and finance head Simon Henry, who took on their roles last year, will not see their pay reviewed again until January 2011 under the reforms.
International exploration boss Malcolm Brinded is also affected by the pay freeze, although he has had his salary kept on hold since July 2008, according to Shell.
The group aims to net up to £2billion a year from asset sales as it exits from non-core activities and focuses its downstream business, including refining and forecourt sales, on the most profitable and high-growth areas.
Shell plans to exit from 15% of its worldwide refining capacity and 35% of its current retail markets.
In a strategy update yesterday, the Anglo-Dutch group admitted it had been slow to respond to the global downturn.
But Mr Voser said the firm was entering a “new period of growth” and he pledged to turn around years of under-performance and ramp up production by 11% to 3.5million barrels a day by 2012.
“These are exciting times for Shell,” he said.
“We are poised to deliver a new wave of financial and production growth.
“We are making substantial investments in new projects to drive the financial performance going forward.”
(Reuters) – Australia Arrow Energy Ltd (AOE.AX) has opened its books to Royal Dutch Shell (RDSa.L) and PetroChina (0857.HK) for them to conduct due diligence for their joint takeover offer worth at least A$3.3 billion ($3.03 billion) sources said on Wednesday.
One of the sources said Arrow is expected to make a response on the offer within days. ($1=1.088 Australian Dollar)
(Reporting by Fayen Wong; Editing by Michael Perry)
Boston Common is one of more than 140 institutional investors supporting a shareowner resolution asking Shell to report on the strategic risks of Canadian oil sands investments in the face of “future carbon prices, oil price volatility, demand for oil, anticipated regulation of greenhouse gas emissions and legal and reputational risks arising from local environmental damage and impairment of traditional livelihoods.”
Click to continue reading “Shareowners Challenge Shell to Report on Oil Sands Risks”
March 17, 2010: Robin Pagnamenta Energy Editor
Royal Dutch Shell will sell full or part-stakes in as many as 9,000 petrol stations worldwide and cut a further 1,000 jobs as it intensifies its global cost-cutting.
The announcement came as Shell appeared to be edging closer to a deal with Arrow Energy to bolster the group’s position in Australia’s fast-growing industry supplying coal-seam gas to China and South-East Asia.
Peter Voser, the chief executive, said that Shell intends to leave about 30 of the 90 countries in which it operates petrol stations. The move, which is already under way, is part of a focus on more profitable markets and on exploration and production.
“We are leaving retail markets where we have low volumes,” Mr Voser told Shell’s annual strategy briefing in London. These would include Greece, Sweden, Vietnam and New Zealand.
Globally, Shell holds interests in about 45,000 petrol stations, of which just under 30,000 are operated directly by the company. Yesterday it indicated that by 2012 it would sell about 2,000 sites outright and cut the number that it operated directly by almost 7,000.
Sites no longer operated directly would follow a model that Shell has pioneered in America, where its retail sites retain the Shell brand and are supplied wholesale by the company but are operated by third parties.
Shell is selling fuel stations in Spain and Portugal. In France, it will leave many of its smaller, regional stations but plans to retain its more profitable, high-volume motorway network.
Britain, where Shell operates about 900 fuel stations and is the biggest player by volume in the retail market, is not expected to bear the brunt of the sales.
Richard Savage, of Mirabaud Securities, said that the move reflected an effort “to release capital to spend more on production”.
The announcement came as Mr Voser said that Shell expected to boost crude oil production by 11 per cent to 3.5 million barrels a day by 2012, up from 3.15 million — reversing seven years of consecutive declines. “All this is underpinned by a new wave of project start-ups,” Mr Voser said. “Beyond that we have an upstream portfolio that can grow to at least 2020.”
He also announced a further 1,000 job cuts, raising the total expected to 7,000 during 2009-11. Shell employed about 102,000 people before Mr Voser revealed the first phase of his reorganisation last July.
He called for “more focus and more urgency”, adding that most of the cuts would be in refining and marketing — which is struggling in the face of the worst industry downturn in 20 years — and in middle management. “The company had become too complicated and slower to respond than we’d like, so we are sharpening up,” he said.
The chief executive’s remarks came as Arrow Energy said that it was in “active discussions” with Shell and Petrochina over their joint $3 billion takeover offer.
Shell, which confirmed the talks but declined to comment, also announced positive news on the discovery of new supplies of oil and gas. The company said that 2009 was the “best year for exploration in a decade”, after finds in Australia and the Gulf of Mexico gave it new reserves equal to almost three times the amount of oil and gas that it produced.
Shell’s reserves at present production rates had increased from ten years at the end of 2008 to 11.9 years at the end of 2009.
Shell is to cut a further 1,000 jobs. Photograph: Graham Turner
Royal Dutch Shell announced a further 1,000 job cuts today as the Anglo-Dutch firm admitted it had been slow to respond to the global slump.
The oil group, which has 100,000 staff worldwide, cut 5,000 posts last year and had already announced a further 1,000 job losses for this year.
Chief executive Peter Voser said the group would axe another 1,000 posts by the end of 2011 as he presented his strategic update for the firm.
“The company had become too complicated and slower to respond than we’d like. So we are sharpening up,” he said.
Shell gave no details on where the cuts would fall. It employs around 8,500 staff in the UK at sites including Aberdeen, London and the Stanlow refinery in Ellesmere Port, which is up for sale.
Voser said Shell was entering a “new period of growth” as he pledged to turn around years of underperformance and increase production 11% to 3.5m barrels a day by 2012.
SHELL is working on a submission for the Environmental Protection Agency (EPA) regarding the discharge of water which will be separated from the gas, writes Marian Harrison. The company agreed with fishermen not to discharge the treated water into the Sruwaddacon Bay and are investigating alternative options before seeking permission from the EPA.
Click to continue reading “Fishermen ‘right to be concerned about mercury’”
: It appears that Voser finally got fed up with Mr Overpromise/Underdelivery. Despite all the nice words about him, he is clearly kicked out. Plenty of sycophants around him are now fearing for their jobs and positioning themselves whom to kow-tow now. This bearded fellow wasted his great brain on very small details and he was unable to delegate. I think his only real good project was the SLIM project. This was many moons ago and launched him to the top jobs. And there he failed as frequently and eloquently pointed out on the Donovan site. Big brain, a micromanager on par with the pointy haired boss in Dilbert, a vicious and vindictive attitude to those that were of no use to him or that might talk back. In summary: Good riddance and now the legal system of Scotland can go after him. But I doubt they will.
: What goes around comes around.... The announcement of Brinded has long been anticipated. We now wait for the next much smaller announcement.... Tom Purves to retire..... This will make our day when that moment happens. Shell never deals with the issue of bad leadership until it is too late and the havoc has been wreaked.... However, as we say in the US, Every dog has its day..... and today that was Malcolm.
: So early retirement then after all that ....... REPLY BY JOHN D. You are still playing a point scoring game. You seem to forget that the avoidable deaths of Shell offshore workers on Brent Bravo is at the heart of this matter. The deaths occurred after a safety audit led by Bill Campbell exposed a shambolic, illegal and shameful safety regime on Brent Bravo. They occurred after Shell senior Expro management had promised Bill that Shell would bring an end to the "Touch F*** All" culture and the falsification of safety records. The explosion and record breaking fine provide proof that the promises were not kept. There is NO commercial aspect to this matter as far as Mr Campbell is concerned. He is driven solely by a fear of an even worse event due to the same policy by Shell of putting production and profits before the safety of offshore workers. Please give Bill some credit for his integrity and for his long campaign, which has rightly received cross-party support from many MP's.
: Agent provocateur indeed!! Never been called that before, and I am most certainly not in league with Shell in any way! I again reiterate my point : was Campbell fired or given early retirement from Shell and thereby lies his grudge or did he reach full retirement age in the company? An honest answer might convince many that his continuous aggressiveness against Shell is genuine or just an ongoing grudge. This is not a "slanging match" merely a point of clarification. REPLY BY JOHN DONOVAN: Mr Campbell has made it clear that he does not wish to get into discussion with someone making insulting comments while hiding behind an alias. With regards to his comment that you may be an agent provocateur, perhaps he gained that impression from checking your history of postings. Just so there is no misunderstanding, we welcome contributors who provide a counter-balance to negative postings about Shell. I have provided some links to further information about the Brent Bravo scandal. Despite all of the promises by Shell senior management about safety, which including appointing a safety Czar, its track record remains atrocious. Years after the Brent Bravo debacle, it was revealed that the lifeboats for a Shell North Sea platform were not seaworthy. You could not make it up. “Lifeboats trouble at Brent field” published on 14 March 2008, UpstreamOnline revealed “SHELL’s safety record on its Brent Bravo platform in the UK Northern North Sea is once again under scrutiny after the discovery of technical problems with two lifeboats on the installation that resulted in both of them being removed from service.” Jake Molloy, general secretary of the Offshore Industry Liaison Committee was quoted in the article by Christopher Hopson as claiming “If they had loaded up this particular lifeboat, the chances are it could have been launched into the sea in an uncontrolled fashion which would have caused death or injury as it was held in place by corrosion and not by the designed system”. The article said that problems had been found with a second lifeboat on the Brent Bravo platform. It also reported that a lifeboat had launched itself into the sea from Shell’s Tern platform because the brakes and clutches were “dysfunctional” and had damaged the launch mechanism off the platform. Shell confirmed problems had been discovered with two lifeboats on Brent Bravo during “routine maintenance”. Shell was quoted as stating that it viewed the matter seriously and had “mobilised an investigation team on the platform”. BILL CAMPBELL EMAIL SENT TO MEMBERS OF THE UK HOUSES OF PARLIAMENT ROYAL DUTCH SHELL SAFETY CONCERNS
: LondonLad: In many cases "Reaching Retirement age" in Shell simply means being unable to find a position outside Shell -nowadays the most competent people generally move on long before reaching retirement age and pursue a second career elsewhere.
: To : an observer of Shell, you state "It is commonly known that a great many employees of Shell Expro are freemasons". Where did you get this "fact" from - smoking whacky backy?? I doubt very much that a great many are indeed freemasons. Even if they are (wich I seriously doubt), so what? Let's face it they are a society that provide one of the largest contributions to charities in the UK. I think you very clearly have an axe to grind against Shell. In that context why does Campbell have such a chip on his shoulder over Shell? Was he sacked for some reason? Did he actually reach his retirement age in Shell? Would be nice to know so that we can believe more that his rants are genuine problems he has with Shell rather than caused by some hidden grudge.
: GTW, I know you are right, TP and others will get their due. What is painful is that those whose lives have been changed and whose spirits have been destroyed because of his actions, will not be compensated. Tom is not the only one taking credit for this new cruel process of forced ranking, by claiming credit for what market demand has meant for profits. There are promotions taking place right now because credit is claimed by those executing Tom's plan for performance 'refirings'. I worked in manufacturing sites where management and performance was a joke, and profits were above forecast. It's always been market demand and the hard work of the folks on the ground that make manufacturing successful, Tom is not a pioneer in taking undue credit for local successes, but he has certainly been the cruelest!
: I have no proof nor will I ever find that proof, but this reprehensible conduct of the legal authorities smells to high heaven of masonic lodges. It is commonly known that a great many employees of Shell Expro are freemasons. The police forces all over the world are well presented in the various lodges. I would not be surprised if Brinded himself is a member. Bill Campbell is a very courageous man taking on these evil forces. We in Shell all knew him to be a completely honest and competent Maintenance manager and HSE auditor. But he loses against all the parasites and sycophants whose sole job is to protect the directors. And then live well on the spoils of their abhorrent activities. Top marks for the Donovans who keep this festering sore in the spotlight. To some it maybe a lot of repeating old stories, but those that want to hide and bury their bad actions know that time is on their side. And Shell has deep pockets and knows how to procrastinate.
: John, there is no issue with my post. This is the same GTW that has been providing updates for some time on the ill fated project CEP and the ill fated Tom Purves, both of which should be going fading into the background this year as old worn out news.
: I retract my previous statement. COMMENT BY JOHN DONOVAN: WE HAVE REASON TO SUSPECT THAT THIS POSTING IS NOT IN FACT FROM THE PARTY WHO USES THE ALIAS "GOLDENTRIANGLE WATCHMAN ON THIS BLOG, BUT IS FROM AN IMPOSTER.
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