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We Found Oil! Is That Good?

Nov 7th, 2011
by John Donovan.
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New ways to extract oil and natural gas could buy the U.S. some time to develop renewable energy. Or they could keep us addicted to dirty fuels.

INTRODUCTION

For renewable energy, even the successes can reveal how much work remains to be done: huge amounts of hydroelectric and wind power in the Pacific Northwest sometimes threaten to overwhelm the grid. So is it good news that recent approaches to drilling have created a boom for fossil fuels?

Companies can now extract oil and natural gas from the high Arctic, shale, oil sands and deepwater wells. These fossil fuels are still finite and dwindling, but tapping the new sources pushes back the date of “peak oil.” Does that give the United States necessary time to develop sustainable energy sources, or will it keep Americans needlessly addicted to dirty fuels by keeping them cheap — and eroding the “energy security” argument?

Cheap Gas Is a Trap

Updated November 6, 2011, 07:00 PM

Matthew Kotchen is a professor of environmental economics and policy at Yale University.

New and efficient technologies for extracting oil and natural gas are increasing the supply of both fuels from North America. But the consequences will be different for oil than for natural gas. Oil is traded in a highly integrated world market, and the relatively small increases in North American oil will have virtually no effect on prices. The result is that our demand for oil will remain unaffected by the change in supply, though we may take comfort in knowing that more of the oil we use is produced closer to home.

Natural gas is a different story. The markets are far less integrated, so the increase in domestic supply will lower prices and increase demand. We will have more households switching from oil to natural gas for heating, and we will have relatively more electricity generated with natural gas than with coal. The lower prices will be a good thing for consumers paying their utility bills, and there will be health and environmental benefits because natural gas is a relatively clean fuel.

But more and cheaper natural gas does not help our prospects for bolstering renewable sources of energy, including solar, wind and biomass. History has shown repeatedly that nothing is worse for renewable energy — and the policies that support it — than cheap and abundant conventional energy. Without the urgency of high fuel prices, the United States has never sustained meaningful private and public investment in the technological innovation and deployment of renewables.

We should do our best to make sure this time is different. There has been meaningful investment — both public and private — in recent years, and despite our current economic challenges, it would be a mistake to turn back these efforts. Also, we must not throw out the baby with the bath water in response to the Solyndra bankruptcy. Instead, it is critical that we find ways to do better with the right economic incentives.

The expansion of oil and natural gas supplies in North America changes little about our long-term energy challenges. Beyond the growing demand for energy worldwide, climate change is an increasingly important and closely related problem. Conventional sources of energy generate greenhouse-gas emissions that cause global warming. While the burning of natural gas generates fewer emissions than oil and coal, its emissions are nevertheless substantial — and extraction using hydraulic fracturing raises other environmental concerns.

Renewable sources of energy provide a leading alternative, and we need a sustained commitment to improving these technologies with the aim of making them cost competitive. Indeed, it should be concerning that China is doing exactly this while we in the U.S. watch our former leadership in renewable energy continue to erode.

SOURCE ARTICLE

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Worlds leading online free source of oil and gas industry news

Nov 3rd, 2011
by John Donovan.
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MORE FREE NEWS ABOUT SHELL AND ITS LEADING RIVALS THAN ANY OTHER WEBSITE. FREE LIVE NEWS FOR SHELL, EXXONMOBIL, BP, CHEVRON AND RELATED CONTROVERSIAL SUBJECTS – OIL SANDS, OIL SPILLS & FRACKING. FREE access to historical information, news archive and current news articles (subject to subscription required on some third party websites). This is an entirely non-commercial independent website owned and operated by Alfred and John Donovan. No subscription or any other charges. No advertising. No donations solicited or accepted.  2,545,430 million hits and 1,513,016 million page views in January 2012.

Shell is another country: they do things differently there

Oct 28th, 2011
by John Donovan.
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The oil giant handles budgets and projects of a size that would daunt nation states. The difference is that it need answer to no one … and it’s running a huge surplus

Posted by Thursday 27 October 2011 13.08 BST The Guardian

Shell: ‘ticking like a Swiss watch’. Photograph: Leon Neal/AFP/Getty Images

What European leader would not want to swap places with Shell boss Peter Voser? He has just doubled the company’s profits in the third quarter, amassed $30bn (£18.7bn) of cash over the last nine months and is now buying back shares at the rate of $800m every three months for want to anything better to do with the money.

Voser has the advantage of having everything to gain from higher energy prices. The social and political fallout from rising fuel poverty and mutinous motorists rarely touches the parallel universe that is Shell Centre in London.

Are there any Shell-shaped worries, then? Well, one of them – in a wider world of growing unemployment, of course – is concern about wage inflation. Shell frets that there is so much activity in the energy sector that it is having to fork out more and more to secure project managers and petroleum engineers.

Voser also has the advantage over the likes of embattled Greek premier George Papandreou in that he can switch spending from one country to another. Unsurprisingly, Shell has not much confidence in Europe: only 15% of
the company’s investment is located this part of the world with 85% elsewhere – increasingly in high-growth Asia.

And how to deal with any worsening financial crisis in the eurozone? Well, the company has just sold its last UK refinery – Stanlow in Cheshire – and says it expects to further reduce its overall investment in Europe as time goes on. The bulk of Shell’s $30bn per annum capital expenditure is going elsewhere – in North America, the Middle East and Asia Pacific.

Also, unlike European political leaders, Voser does not have to worry about global warming or meeting carbon targets. Some of the company’s cash is being pumped into dirty tar sands production in Canada – which is pleasing the Ottawa government if not making any new friends in the environmental movement.

But Shell is also bulking up an already world-leading position in the cleaner gas
market, particularly the liquefied natural gas sector.

And even oil companies do have to make some tough decisions. The cost
of investing in a big scheme – say the Pearl gas-to-liquids project in Qatar, for example – is more than the final bill for building the Channel Tunnel singlehanded. It is unlikely Voser would get away with letting the costs for that scheme double to £10bn, as happened with the rail link.

One oil analyst described Shell as “ticking like a Swiss watch”. That might be true. But it also relies on $100-a-barrel oil prices – and if the sovereign debt crisis triggered a double-dip recession, we might hear the company squawking like a cuckoo clock.

SOURCE ARTICLE

Economic benefits will likely win Keystone XL approval: Shell

Oct 25th, 2011
by John Donovan.
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Oct 24, 2011 – 5:41 PM ET

TORONTO — The U.S. government is likely to approve the Keystone XL pipeline in part because of the economic benefits that would come along with the controversial US$7-billion project, the head of Royal Dutch Shell’s North American operations, predicted Monday.

In fact, the economic benefits attendant on the energy industries in North America in general are even more important than energy independence, Marvin Odum, president of Shell Oil Co. and upstream director of Royal Dutch Shell’s subsidiary company in the Americas, said at a Toronto conference.

“As you get a real balance of environmental concerns with pipeline safety concerns, with energy security, with the creation of jobs and with the improvement in the economy as a whole, I think a decision will be made to proceed with that pipeline,” Mr. Odum said. “It actually feels pretty obvious to me that will be the decision so that’s my expectation of the government.”

The United States is expected to make a decision on the fate of the TransCanada pipeline, which will transport heavy oil from the Alberta oil sands to refineries on the U.S. Gulf Coast and already has regulatory approval in Canada, by the end of the year.
“From the oil sands perspective, the Keystone XL pipeline is an extremely important part of developing that resource and will be a critical supply artery to the U.S.,” said the executive, who was the keynote speaker at the lunch session of the fifth annual Toronto Forum for Global Cities conference hosted by the International Economic Forum of the Americas.

Anglo-Dutch Shell is one of Canada’s biggest oil sands developers as a 60% partner in the giant Athabasca Oil Sands Project in Alberta.

On the subject of energy security or independence, Mr. Odum said it’s an “interesting goal” but not one he sees as a “primary driver.”

“As I look across North America… the supply potential is enormous and it’s changed dramatically over the last four or five years,” he said, pointing to the development of natural gas plays and the oil sands as well as other resources in Mexico and Alaska.

“So with all of that within reach of North Americans, it could clearly drive us toward the direction of energy independence, but I think the bigger driver in the near term is the economic benefit that comes from that, the number of jobs that come from that,” Mr. Odum said.

He said the United States should consider connections with friendly trade partners like Canada and Mexico as well as a number of South American countries as part of the idea of energy independence more broadly.

Mr. Odum also addressed the controversy over hydraulic fracturing or “fracking” used to extract natural gas from shale reservoirs and said companies can address this through transparency in what they’re doing.

“This is a case where the arguments have gotten away from businesses and industry,” he said. “It actually never should have been a big issue. These are relatively small components in the fracture treating fluids that we put in the ground.”

He noted that all of the components of the fracturing fluid Shell uses are listed on its website, although for proprietary reasons, the specific percentages are not disclosed.

SOURCE ARTICLE

Will Malcolm Brinded be attending the funeral of his friend Gaddafi?

Oct 20th, 2011
by John Donovan.
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COMMENTS FROM A ROYAL DUTCH SHELL RETIREE ON CURRENT NEWS STORIES

Interested in the report on this leak they are trying to stop in Athabasca…

Oilsands leak turned mine to pond

Few people probably realise this is a nightmare and very likely unstoppable until the whole aquifer runs out of energy. Compare it with a blow-out.  I think it is a major mishap but have no other info then what I read in the article.

And the oilwells in Sakhalin going to sand is a disaster of great magnitude.

6 Oil Wells On Sakhalin Go Offline

With winter starting they presumably cannot re-enter the wells and try to fix it. It also shows the original design was flawed. I bet that even those atheist Russians (and the secular Shell folk as well)  are praying the same will not happen on the gaswells because then they really are f*cked!

Finally, will Malcolm Brinded be attending the funeral of his friend Gaddafi, or is Shell’s focus solely on its slick switch of allegiance to the new government?

Shell execs in Tripoli discuss Libya return


Shell set to plug leak that created pond at oilsands mine

Oct 15th, 2011
by John Donovan.
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Never-seen-before problem shows importance of additional seismic work in areas earmarked for mining

By Dave Cooper, edmontonjournal.com October 14, 2011

The flooded pit at Shell’s Muskeg River mine now holds about seven million cubic metres of salty water after a deep crack formed in the rock below the mined-out area last year, allowing water from a deep aquifer to flow upwards. It was the first time an oilsands firm has faced such a situation. Shell is building a drilling pad in the pond and will inject hot asphalt and then cement into the crack to permanently seal the leak next year. Photograph by: Shell Canada, edmontonjournal.com

EDMONTON – When water started appearing at the bottom of a Muskeg River mine pit north of Fort McMurray last October, crews assumed it was normal seepage from surrounding rock.

But it quickly became clear that this was something different — the water was not slowly rising from the basal aquifer, but flowing in under pressure, bubbling up from the bottom of the pit. It was salty, and it stank of rotten eggs, thanks to low levels of hydrogen sulphide.

So it was clearly coming from a deeper aquifer, and that meant it needed to be patched.

But how to do it?

Shell Canada tested the site to learn more about its geology and has recently come up with an innovative plan to permanently seal the crack in the floor of the mined-out pit, named cell 2A. It also has a way to deal with the seven million cubic metres (seven billion litres) of salty water now sitting in the former mine pit — a deep pond that is still growing at 200 cubic metres (200,000 litres) per hour.

“This situation in cell 2A was unexpected and something that has never happened to any oilsands mine before. But what we have now learned is going to change the way we operate, and I think the other firms will be doing the same,” said John Rhind, vice-president of heavy-oil operations for Shell Canada Energy, the operator and majority owner of the Albian Sands project.

And that means doing additional seismic work throughout areas that are planned for mining, so geologists can detect weak areas in the underlying limestone — the 150-metre-thick rock that lies above the deep saline aquifer that is the source of the water in cell 2A.

In this area of the Muskeg River mine, Shell had removed 40 metres of overburden and up to 70 metres of oilsands. Crews were cleaning out the bottom of the cell, down to the limestone base, when the water began gushing in.

“We immediately got the heavy equipment out of there. We had already started to build this cell to hold tailings, so we continued to build up the berms” to contain the salty water, Rhind said.

Water initially gushed in at 2,000 cubic metres (two million litres) per hour.

Geologists know the aquifer under cell 2A originates in Saskatchewan, where fresh water enters the ground and becomes salty as it moves through the salt-rich layer of porous rock. The aquifer eventually seeps into the Athabasca River.

Shell estimates a five-metre-long crack that snakes up through the limestone is the source of the problem.

The firm is currently filling in a small portion of the pond above the leak, dumping sand over a layer of rip-rap (rubble to allow drainage from the leak to continue) to create a base for a drill rig.

“We are going to drill holes from this pad that we are creating, which will allow us to take core samples, and also be a way to inject sealant.”

Shell considered using a floating drilling barge, but if the hydrogen sulphide gas returned it would be a safety hazard for the crew.

“The pad is the safest approach,” he said.

Shell brought in its experts from around the world, people with experience in the Gulf of Mexico and the North Sea, and scientists from Houston and Amsterdam to study the problem.

Normal cement injection won’t work because of the incoming water flow, so Shell intends to inject a hot asphalt material to create a temporary seal. Then grouting cement will be pumped down to make the seal permanent.

Drilling should be completed by January, and Rhind figures it will take another 10 months to complete the sealing process.

Dealing with the remaining water is a simpler problem. Shell can’t use the salty water in its processes, but another oil firm may be able to pipe it to its facility.

Perhaps the easiest solution is to slowly add dry sand from the tailings handling process.

“Dry sand would slowly absorb the water. There would be about 30 per cent water in the sand, and other tailings areas receive wetter sand,” Rhind said.

Reclamation could then proceed as normal, “and as our aboriginal neighbours tell us, the real architects of the land, the beaver, will come in and finish off the landscape,” he adds.

The Energy Resources Conservation Board is closely following the Shell project, spokesman Bob Curran said.

“We believe what Shell is doing is appropriate,” he said.

He could not comment on any moves to ensure all firms do full seismic work at future mine sites to detect any weakness in the limestone cap rock which overlies the deep aquifer.

But Rhind says Shell is sharing all its seismic data with its competitors, Suncor, Syncrude, Canadian Natural and Esso.

“They are happy. Everybody in the industry will learn what we have learned,” he said.

“And from this point forward, we are doing the extra seismic at Muskeg and our new Jackpine Mine so we know what we are dealing with under the oilsands.”

dcooper@edmontonjournal.com

—

The Muskeg River Mine Leak

- In October 2010, a five-metre crack developed in a weak area of the 150-metre thick limestone which caps a salty aquifer.

- After mining was completed, but before tailings were added to cell 2A, up to 2,000 cubic metres per hour of salty water flowed in through this crack.

- Containment walls were heightened as the cell filled, but the pressure of the new pond slowed the inflow to just 200 cubic metres per hour.

- Shell is now building a pad in the pond to support a rig which will drill three holes around and through the fracture to understand the geology.

- In January, Shell will begin pumping hot asphalt down these holes to create a temporary seal. Then grouting cement will be pumped in to make the seal permanent by the end of 2012.

- Dry sand will then be added to soak up the salty water, and normal land reclamation will proceed.

© Copyright (c) The Edmonton Journal

Shell Won’t Shed Refineries, CEO Says

Sep 22nd, 2011
by John Donovan.
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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

Shell On Track To Deliver Growth Targets For 50%-80% Cashflow By 2012

Sep 9th, 2011
by John Donovan.
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SEPTEMBER 9, 2011

LONDON (Dow Jones)–Royal Dutch Shell PLC (RDSA.LN), Friday confirmed that it has made solid progress in starting up three world-class oil & gas projects in 2011, which at peak will add some 400,000 barrels oil equivalent, and is on track to deliver its strategic targets for 50-80% growth in cash flow from operations from 2009 to 2012.

MAIN FACTS:

-Shell’s three-year strategic plan, outlined in 2010, is building the foundations for profitable growth for shareholders in the future.

-The company is improving near-term competitive performance, and delivering a new wave of production growth.

-Shell’s decision to maintain investment in new projects in the 2009 downturn is driving growth in the company.

-In Canada oil sands, the company has progressed with ramping-up of the expansion project at its Scotford Upgrader, and ASOP-1 recently reached its full production level of 100,000 barrels per day.

-In Qatar, the Qatargas 4 LNG project reached production plateau earlier this year. Ramp up of Train 1 of the Pearl GTL project continues to make good progress, with Train 2 on track for start-up before year- end, as planned.

-These three projects, representing some $30 billion of investment, underpin our targets for financial and production growth to 2012.

-The company is on track to deliver strategic targets for 50-80% growth in cash flow from operations from 2009 to 2012, driven by cost savings, operating performance, and an 11% increase in oil & gas production from one of the most substantial portfolios of new oil & gas projects in the industry Friday.

-Building on this growth, the company has launched 14 further Upstream projects so far in 2010-11, which have a expected peak production of some 400,000 barrels oil equivalent per day for Shell in the medium term, and underpinning the company’s longer-term growth potential.

-In Downstream, as the company completes a major phase of asset sales, it is consolidating this reshaped portfolio, focusing on operating performance, and investing in selective growth, for example recently forming the Ra??zen biofuels and marketing joint venture in Brazil.

-The scale and integration of projects such as Pearl GTL, Ra??zen biofuels and Prelude floating LNG are a solid platform to create long term value for shareholders.

-Shares at 1315 GMT down 10 pence, or 0.5%, at GBP20.49, valuing the company at GBP74.19 billion.

-By Razak Musah Baba, Dow Jones Newswires; 44-20-7842-9275; razak.baba@dowjones.com

SOURCE ARTICLE

Revealed: Shell’s poor safety record in the UK

Aug 21st, 2011
by John Donovan.
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“Shell’s poor regard for safety and their terrible communications over the last 10 days should be ringing major alarm bells…”

Last week’s North Sea oil spill was not the first time Shell had found itself in trouble. Environment Editor Rob Edwards reports

Shell has been officially censured for breaking safety rules 25 times in the last six years and has one of the worst safety records of the major oil companies in the UK, an investigation by the Sunday Herald has revealed.

The British oil multinational has been prosecuted, fined and formally reprimanded for repeatedly failing to maintain pipelines and other vital equipment in the North Sea, for failing to report a dangerous incident, and for failing to protect workers from hazardous chemicals.

The revelations, from records held by the Government’s Health and Safety Executive (HSE), have led to renewed criticism of Shell in the wake of last week’s oil leak from a pipeline to the Gannet Alpha platform 112 miles east of Aberdeen. The company has been slammed for failing to be open about the leak, which it claimed to have sealed on Friday.

Now, critics have lambasted Shell for being a “serial offender” that refuses to learn from its mistakes. And they warn that the regulatory regime meant to ensure the safety of the North Sea oil industry is no longer fit for purpose.

“This shocking history of warnings, violations and prosecutions could suggest a company that is cutting corners on essential maintenance and skimping on safety,” said Dr Richard Dixon, director of the environmental group, WWF Scotland.

“With such a lamentable performance, something like the Gannet Alpha spill was almost bound to happen. The question now is what other knackered bits of kit are about to give out.”

Dixon called for Shell’s North Sea operations to be restricted until a full and independent audit of all its facilities had been carried out. “Shell’s poor regard for safety and their terrible communications over the last 10 days should be ringing major alarm bells with the UK Department of Energy and Climate Change and the HSE,” he argued.

The HSE maintains online databases of all the prosecutions, prohibition orders and improvement notices against UK companies for breaching health and safety regulations. An analysis of those involving oil companies shows that Shell is among the top offenders.

Since 2005, Shell has been prosecuted four times: for an explosion at Bacton gas terminal near Norwich; an accident at Ellesmere Port in Cheshire; a collision at the Mossmoran gas plant in Fife; and a fatality on the Clipper rig in the North Sea. The company has been forced to pay out nearly £1 million in fines and legal costs.

No other major oil company has faced as many prosecutions in the last six years. According to the HSE, Talisman has been prosecuted twice, while BP, Total, Amec and Nexen have each been prosecuted once (see table).

In addition, Shell has been served with 21 prohibition and improvement notices by HSE safety inspectors since 2005. The company has twice been told it was guilty of a “failure to implement a suitably resourced maintenance regime” on the Clipper rig, once in 2006 and again in 2007.

“This has lead to excessive backlog of maintenance activities for safety-critical equipment and non-safety-critical equipment, leading to poor working order and repair of equipment,” said the HSE.

In October 2009, Shell was served an urgent prohibition notice to remedy dangers on the Brent Charlie platform. According to HSE, there was “a risk of serious personal injury because there is no effective means of safely removing toxic and flammable gas” from below a floor.

In April 2007, Shell was accused by HSE of failing to report “by the quickest practicable means that there was a dangerous occurrence” on the Dunlin Alpha rig. There have also been maintenance failures on Brent Bravo and Leman Alpha, as well as problems controlling exposure to asbestos on Leman Charlie and another toxic chemical on Dunlin Alpha (see table below).

Only one oil company has received more enforcement notices than Shell. That is the Danish corporation, Maersk, which has been served 33 prohibition and improvement notices by HSE since 2005. But it hasn’t been prosecuted.

Other evidence previously released under freedom of information law shows that Shell rigs have one of the worst records for oil spills in the North Sea over the last two years. There were leaks from seven of the company’s platforms in 2009 and 2010.

The most spills were from the Brent Charlie rig, which suffered seven leaks in the two years. The biggest was in April last year when an escape of four tonnes of gas triggered a production shutdown.

Shell’s poor track record prompted experts to question whether the current regulatory regime is working. The company’s performance was “deeply worrying” in an industry which suffered “serious and often potentially catastrophic shortcomings,” warned Professor Andrew Watterson, head of the occupational and environmental health research group at the University of Stirling.

He pointed out that ensuring health and safety for oil workers should help reduce pollution. “But this will not happen if companies can escape the consequences of poor performance and offset much of the human, environmental and economic damage they do onto injured workers and wildlife,” he argued.

According to Watterson, oil and gas spills in the offshore industry as a whole rose from 65 in 2008-09 to 85 in 2009-10. At the same time, major injuries rose sharply from 106 to 188 per 100,000 workers.

“The number of HSE offshore inspectors in the same years fell from 98 to 90,” he said. “These are not figures that inspire confidence either in the oil industry or the increasingly run-down regulators.”

The HSE, however, insisted it had an established record of holding oil companies to account. The offshore industry was obliged to adopt high standards, which were independently checked, it said.

“Although we are confident that we have one of the most robust safety regimes in the world, we are not complacent,” said an HSE spokesman. “The penalties imposed for breaches of offshore regulations are a matter for the courts.”

He added: “HSE’s enforcement notices database is not designed to be read as a safety league table. Counting the number of enforcement notices does not take account, for example, of the number of installations a company may operate.”

Shell stressed that its “prime focus” was a commitment to ensur- ing the safety of staff and infrastruc- ture. “We constantly inspect, monitor and review all our assets,” said a company spokeswoman.

“We work closely with regulators and have invested over $1 billion in recent years to upgrade facilities across the North Sea.”

But that is not going to comfort environmentalists. “Shell appears to have one of the poorest safety records of the major oil companies,” said Stan Blackley, the chief executive of Friends of the Earth Scotland.

“This doesn’t really surprise us, but it’s depressing all the same. Already some environmental and human rights groups claim Shell has a reputation for poor practice, complacency and misinformation.”

Blackley said Shell was fiercely criticised for pollution and human rights abuses in the Niger Delta. “Fining Shell is not going to make it change its ways,” he warned.

“The executives running the business need to be held accountable for any failings or wrongdoings and, if found guilty of any breach of the law, prosecuted to the full extent of the law.”

SOURCE ARTICLE

Shell profits jump 77% on higher oil prices

Jul 28th, 2011
by John Donovan.
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28 July 2011 Last updated at 14:16

Oil giant Royal Dutch Shell has reported a 77% jump in second-quarter profit, thanks to higher energy prices.

Shell’s profit for the three months to June came in at $8bn (£4.9bn) on a current cost of supplies basis, up from $4.5bn in the same period last year.

Though oil and gas production was 2% lower than the same quarter in 2010, the company said it had benefited from asset sales in the first half of 2011.

Earlier this week, rival BP announced second-quarter profits of $5.3bn.

On Thursday, larger US rival Exxon Mobil said that net profit rose 41% to $10.7bn for the three months to June from the same period last year.

New projects

The price of oil is much higher now than it was a year ago, in part inflated by political unrest in oil-producing countries such as Libya.

Twelve months ago, US light sweet crude oil was trading at about $78 a barrel. It is currently trading at about $97 a barrel, having topped $110 at the end of April.

Shell also said it had sold $4bn of non-core assets in the first six months of the year, which was a “key driver” to reducing costs and improving its operating performance.

However, like BP, Shell’s production was down in the second quarter year-on-year, due to field sales and warm weather which hit European gas demand.

But the company said it had started three large-scale projects this year that would add to its oil production by over 400,000 barrels per day.

These are a Canadian oil sands venture and two gas plants in Qatar, in which it has invested $30bn.

“We have made important progress with new production in 2011, and the ramp-up of our new projects should drive our financial performance in the coming quarters,” said Shell chief executive Peter Voser.

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