Posts from ‘September, 2011’

Published: Sept. 23, 2011 at 8:22 AM

BANDAR SERI BEGAWAN, Brunei, Sept. 23 (UPI) — Natural gas resources will help fuel economic growth in Asia, where advances are vastly outpacing the rest of the world, a Shell executive said.

Malcolm Brinded, executive director for upstream developments at Shell, spoke to delegates at an energy conference in Brunei.

He said advancing economies in Asia, coupled with the energy deficit brought on by Japan’s nuclear power disaster, means the region needs to “invest heavily” in all resources, including solar and wind.

Beijing is moving to include more renewable energy on the national grid. The country set a goal of increasing its solar power capacity significantly in the next five years.

Brinded noted, however, that conventional resources like oil and natural gas will continue to dominate the global energy mix.

“Natural gas will not just be a reliable and abundant fuel for Asia’s remarkable economic growth,” he said. “As the cleanest burning fossil fuel, it can also make an immediate impact in cushioning the environmental impact of the region’s rising energy consumption.”

This week, Howard Gruenspecht, acting administrator at the U.S. Energy Information Administration, said top energy consumer China is expected to use 68 percent more energy than the United States within the next quarter century.

The EIA said the expected increase in world energy consumption by 53 percent by 2035 to be driven largely by economic growth in China and India.

September 22, 2011, 6:30 PM EDT

Far-flung Point Hope puts Shell’s plans for Arctic drilling on ice

Alaska Stock/Alamy

By Katarzyna Klimasinska

This summer, four-year-old Micah Kinneeveauk helped catch and kill his first seal. His proud grandmother plans to reward him with a special dessert at Thanksgiving: A big bowl of ice cream flavored with caribou meat and fat. Hunting seals and whales in the Chukchi Sea and caribou and polar bears on the tundra has provided food, clothing, and rites of passage for centuries in tiny Point Hope, Alaska, a barren gravel village of 800 Inupiat natives located 125 miles north of the Arctic Circle. Many of the people live largely on what they catch.

That’s why Micah’s grandmother, Caroline Cannon, sees trouble in Royal Dutch Shell’s plans to drill for oil in the Chukchi and Beaufort seas. In the long shadow of the Exxon (XOM) Valdez and BP (BP) disasters, she’s unconvinced by Shell’s assurances that it has helicopters, robots, divers, and skimmers available to respond if it loses control of a well, along with a cap-and-containment system similar to the one that ultimately plugged the BP gusher. “There is no technology to clean up an oil spill, and it’s devastating if it happens,” says Cannon, who serves as the village president. “I have 25 grandchildren. That’s why I oppose offshore drilling 2,500 percent—I want them to have a chance to have the same kind of subsistence life I have.”

Many of Cannon’s fellow villagers feel the same way, and the town has been remarkably effective at delaying the company’s plans to begin work in the region. Point Hope successfully challenged government-issued permits for emissions from the rigs, preventing Shell from drilling this summer. It also sued to challenge the government’s lease sale, convincing a court that more public comment and environmental studies were needed. Although Shell won its first lease to extract oil from beneath U.S. Arctic waters in 2005, it has yet to drill a single well, despite spending what it says is almost $4 billion on leases, research, engineering, lawsuits, and government-ordered studies.

Part of Shell’s problem is that it doesn’t have much to offer the villagers to help win them over. The company predicts that development of the offshore fields would create 35,000 jobs a year in the state and bring $4 billion to local governments by 2057. Shell says Point Hope would get its share of the wealth. “We are committed to providing the village … with the same opportunities for jobs and shared services as other villages,” says spokesman Curtis Smith.

Many of the residents of Point Hope say they aren’t interested. The ramshackle village has a grocery store, a Chinese takeout, and not much else. They don’t want Shell coming in and building up the place. They aren’t expecting to be offered jobs on the rigs. They don’t want money. Mostly, the people say, they want to be left alone. “No matter how much money you’ve got, that money goes,” says Ronald Oviok, who says he has caught more than a dozen whales in his 69 years. “I’ve got no money. I don’t really care for money.”

Point Hope is exploring further legal challenges but likely can’t keep Shell from drilling forever. This week the EPA issued revised emissions permits, and in August Michael Bromwich, the chief U.S. offshore oil regulator, approved the company’s plans to explore in the Beaufort Sea provided it also wins permits from the U.S. Fish and Wildlife Service and the National Marine Fisheries Service, which are under review. A U.S. decision on the Chukchi Sea is still pending. “We are accustomed to making decisions that may not make everybody happy,” Bromwich said after meetings with native leaders and Shell executives in Alaska this month. “We have to make decisions based on the best information we have available and the appropriate balance.”

The eventual payoff for Shell will be worth the headaches. The Chukchi holds an estimated 15 billion barrels of oil—about as much as Alaska’s North Slope has produced since 1977. “Chukchi fields truly have the potential to be absolute world class,” says Pete Slaiby, Shell’s vice-president in charge of Alaska operations. That assumes the company can get to them. The Chukchi Sea is buried in ice for eight months every year, meaning Shell can only drill from July through October. That short window came and went this year, and the company must soon decide whether to begin planning to drill when the thaw comes next year—or to brace for yet another summer in court.

The bottom line: Shell, which spent nearly $4 billion for rights to drill in Arctic waters, has been stymied by villagers suing to stop the oil giant.

Klimasinska is a reporter for Bloomberg News.

Alaska Dispatch | Sep 21, 2011

Environmental groups say they’re reviewing air quality permits approved Monday by the federal government for Shell Oil, which hopes to drill offshore next year in Alaska’s Arctic.

The Environmental Protection Agency authorized air emissions from Shell’s drill ship Discover and a support fleet of icebreakers, oil spill response vessels and supply ships to operate 120 days a year in Alaska’s Chukchi and Beaufort seas.

According to reports by Dow Jones and Reuters, Shell could face additional legal challenges over the permits, the approval of which marked a “major milestone” in oil multinational’s multi-year, billion dollar Arctic offshore drilling quest.

Lawyers for Earthjustice and the Center for Biological Diversity are reportedly reviewing the air permits before they, along with Alaska Native tribal groups they represent, decide to appeal.

Erik Grafe, with Earthjustice and based in Alaska, told Dow Jones that “until the petition is adjudicated, Shell does not have a final air permit.”

Brendan Cummings, a senior lawyer for the Center for Biological Diversity, said that “all signs were that the group would appeal the new permits,” Reuters reported.

Other permits still need yet to be acquired and approved before Shell can proceed with its Arctic drilling plans.

Read more about the quest to unlock Arctic Alaska energy reserves.

SOURCE ARTICLE

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The unions contend Royal Dutch/Shell, the world’s second largest multinational company in terms of sales, employs black slave labor in South Africa’s Rietspruit coal mine…

Publication: Chicago Sun-Times
Date: January 19, 1986
Author: Barry Cronin
Section: SUNDAY NEWS
Edition: FIVE STAR SPORTS FINAL
Page: 55

A coalition of labor unions has called on Americans to boycott products sold by the Shell Oil Co., a subsidiary of the Royal Dutch/ Shell Group, which has extensive oil, coal and chemical operations in South Africa.

The unions contend Royal Dutch/Shell, the world’s second largest multinational company in terms of sales, employs black slave labor in South Africa’s Rietspruit coal mine, of which it owns 50 percent with a South African firm.

“We hope this boycott will encourage Shell to disinvest in South Africa as part of the broad effort to pressure the South African regime to help bring about an end to the apartheid system,” said Owen Bieber, president of the United Auto Workers and chairman of the AFL-CIO’s Ad Hoc Committee on South Africa.

A spokesman for Shell Oil in Houston said the boycott is “unfortunate and misplaced” and that it will hurt American workers associated with Shell products.

The unions say their boycott is aimed not at individual merchants who happen to sell Shell products, but only Shell products themselves. Union leaders are asking the public to cut up their Shell credit cards and not buy Shell goods.

Copyright 1986, 1996 Chicago Sun-Times, Inc.

SEPTEMBER 21, 2011

By RYAN DEZEMBER

Royal Dutch Shell PLC’s chief executive says he has no plans to follow in the footsteps of rivals and shed refineries.

“We will remain an integrated oil company,” Peter Voser, head of the Anglo-Dutch oil giant, said Wednesday in an interview with The Wall Street Journal.

Several so-called integrated oil companies, which explore for oil and refine crude, have lately concluded they would be better off split into separate parts.

ConocoPhillips said in July that it is dividing itself into two publicly traded companies, one for each side of the business. That follows a similar move Marathon Oil Corp. made this summer when it created publicly traded Marathon Petroleum Corp. to run its refineries. Meanwhile, Murphy Oil Corp. has sold all of its refineries except for one in Wales, which it is actively shopping.

But Mr. Voser said Shell values its refineries as part of its overall business. Owning refineries, he said, should give the company an advantage in developing its Canadian oil sands, the thick crude that requires intense refining, and in its efforts to turn North America’s abundant natural gas into fuel for vehicles.

If a company is only involved in one part of the oil-and-gas business, he said, “you have the risk that others will optimize the value chain.”

Mr. Voser said that having refining capabilities also gives Shell an advantage when courting government-owned oil companies, which typically have access to vast reserves but little capability to get oil and gas out of the ground or to turn them into marketable products.

“For us to be the right partner to national oil companies, we have to be integrated,” he said.

Separately, when asked Wednesday about market rumors that Shell was targeting gas producer Range Resources Corp. for an acquisition, Mr. Voser said “We don’t comment on rumor, but we’ve got plenty on our table to deliver.”

Range’s operations are increasingly focused on the Marcellus Shale in Pennsylvania and New York, a deeply buried rock formation that has quickly become one of the most prolific natural-gas fields in the world.

Mr. Voser said Shell has some 40 trillion cubic feet of so-called unconventional natural-gas reserves, such as gas from shale, in the U.S. and Canada, some of it acquired when the company bought East Resources last year for $4.7 billion. Shell intends to focus on developing those reserves with an eye toward projects that turn natural gas into a liquid transportation fuel, exporting liquefied natural gas and chemical manufacturing, he said.

A spokesman for Range Resources didn’t respond to a request for comment.

Shell’s U.S.-traded class A shares closed Wednesday down about 4% at $63.15. Shares of Range Resources closed up nearly 5% at $67.96 in New York Stock Exchange trading.

SOURCE ARTICLE

Royal Dutch Shell will invest more than $1.6bn in the second phase exploration of a key Brazilian oil block and also plans to compete in the country’s next auction of oil and gas concessions, senior company figures have disclosed.

An oil rig in Guanabara bay, Rio de Janeiro Photo: Alamy

By Robin Yapp, in Sao Paulo 7:07PM BST 21 Sep 2011

Already Brazil’s second biggest oil producer after the state-run energy giant Petrobras, Shell has had impressive results in the Campos Basin, part of Brazil’s pre-salt oil fields that lie deep below the Atlantic ocean and a thick layer of salt.

Production in the area has been 30pc higher than anticipated, convincing Shell to make substantial further investment in the hope of seeing similarly impressive results.

Andre Araujo, president of Shell Brazil, said the second phase development of the BC-10 block in the Campos Basin – in which Shell has a 50pc share and is believed to hold 400m barrels of recoverable oil – will start next year.

“To give you an idea of the importance of exploratory activity in Brazil for Shell, we are going to invest, just in the second phase of BC-10, more than the $1.6bn that we spent to set up Raizen [its joint venture Brazilian ethanol plant],” he said.

Marvin Odum, Shell’s director of exploration and production for the Americas, said the company would look to further expand in Brazil because it now appears a more attractive investment prospect than many other oil-producing nations.

“The opportunities that we find here are of the highest quality in global terms, both from the regulatory point of view and geological,” Mr Odum told business newspaper Brasil Economico.

“Because of this, we don’t believe that a recovery of production in countries such as Iraq and Libya, in the future, will reduce Brazil’s attractiveness. The pre-salt has areas of the highest quality.”

Mr Odum indicated that Shell was likely to compete when Brazil’s National Petroleum Agency auctions new exploration blocks off the country’s north-east coast in 2012 but said a final decision would be taken after details of the auction are published.

SOURCE ARTICLE

By Ed Crooks in New York

Published: September 21 2011 23:40

Extracts

Oil and gas supplies will struggle to keep up with world demand growth, making energy prices more expensive and more volatile in the long term, the head of Europe’s largest oil company has warned.

Peter Voser, the chief executive of Royal Dutch Shell, told the Financial Times:

“We will have a lot of volatility ahead of us that we cannot avoid … for energy prices in general.”

Complete article

Environmental groups are considering a challenge to a set of permits issued to Royal Dutch Shell this week for oil drilling projects off the coast of Alaska, reports have said.

Bill Lehane and news wires 21 September 2011 12:25 GMT

The Environmental Protection Agency (EPA) announced on Monday it had approved the air quality permits for the Anglo-Dutch supermajor to operate the Discoverer drillship and supporting vessels in the Chukchi and Beaufort Seas starting in 2012.

Environmental groups now say they are reviewing the EPA permits to determine whether to file a challenge with the agency’s Environmental Appeals Board (EAB), according to Dow Jones.

If ultimately successful, the permits would mark a major milestone in Shell’s years-long effort to drill off the coast of Alaska after permit requirements and challenges from tribal and environmental groups stymied the projects.

Loss of similar permits in a battle with environmentalists and Alaska native groups last winter forced Shell to abandon its plan to drill this year.

It is unclear whether a fresh appeal would force Shell to delay its latest plans to begin drilling by July 2012.

Erik Grafe, an Alaska-based staff attorney with Earthjustice, told the wire service tribal and environmental groups had not yet decided to appeal, but added that any appeals process could stretch into early next year.

“Until the petition is adjudicated, Shell does not have a final air permit”, Grafe said.

Shell spokeswoman Kelly op de Weegh said the timing for a possible appeal process would be up to the EAB.

“With this final permit, we feel the EPA has adequately addressed the very specific points that were challenged when the permit was previously remanded back to the EPA”, op de Weegh said.

Center for Biological Diversity senior staff attorney Brendan Cummings, one of the groups that challenged the earlier permits, told Reuters on Monday that all signs were that the group would appeal the new permits.

“The fact that these permits were struck down by the EAB last year forced them so do some things that will reduce pollution. But not really as much as they could and should and we believe that the law requires them to do”, he said.

In addition to the air quality permits from EPA, Shell also has to obtain approvals and permits from other federal agencies.

Since 2005, Shell has spent more than $3.5 billion on its Alaska exploration programme, mostly for leases in the lightly explored Chukchi, off northwestern Alaska, and the Beaufort, off the state’s northern coast.

But the company has yet to drill a single well on those properties because of adverse court rulings and offshore policy changes prompted by last year’s Deepwater Horizon disaster.

Published: 21 September 2011 12:25 GMT

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By John Donovan

In the years in the run up to WW2, Royal Dutch Shell was a business partner both Internationally and in Germany with IG Farben, the notorious German chemical firm. Farben supplied Zyklon-B gas to the Nazi concentration camps, in which millions of innocent people including children, were murdered in the Holocaust.

IG Farben shared patent rights to synthetic oil and other products with Shell.

Royal Dutch Shell group was also a major partner with Farben in jointly owned companies, including Deutsche Gasolin A.G., which operated a refinery and gasoline service station network in Nazi Germany.

Shell was also a major partner in oil related cartels with I.G. Farben and Standard Oil.

A New York Times article published in October 1945 quoted from an I.G. Farben report to the Gestapo on how Germany had benefited from oil cartel agreements.

The report said that experience in the field of lubricants was of the “utmost importance in warfare” and enabled Germany to be “completely prepared from a technical point of view…”

The article went on to say:

Standard Oil and the Anglo-Netherland Royal Dutch Shell group also aided I. G. Farben in 1934 and 1935 to purchase large quantities of mineral-oil products, the report  said. These products, including airplane benzine and lubricants, were bought for a market price of $20,000,000 and stored as reserve stocks.

Further proof of massive Royal Dutch Shell support for the Nazis.