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The elephant in the atmosphere

Screen Shot 2014-03-10 at 23.56.16Extract from an article published by on 19 July 2014: “Shell, Exxon and carbon: The elephant in the atmosphere”

IN SEPTEMBER 2013 a group of institutional investors with $3 trillion of assets under management asked the 45 biggest quoted oil firms how climate change might affect their business and, in particular, whether any of their oil reserves might become “stranded assets”—unusable if laws to curb emissions of carbon dioxide became really tight. Exxon Mobil and Shell are the most recent to get back with their assessment of the risk: zero. “We do not believe that any of our proven reserves will become ‘stranded’,” says Shell.


South African anti-fracking group threatens legal challenge

Screen Shot 2014-03-11 at 14.07.51Extract from a Reuters article by Ed Cropley published 22 July 2014 under the headline: “UPDATE 1-S.African anti-fracking group threatens legal challenge”

JOHANNESBURG, July 22 (Reuters) – A South African anti-fracking group threatened a legal challenge on Tuesday to government plans to grant shale gas exploration licences in the pristine semi-desert of the Karoo, saying the regulatory process had been marked by “patent ineptitude”. Green groups wanting to protect the Karoo, believed to hold significant shale gas deposits, said Pretoria was incapable of ensuring firms such as Royal Dutch Shell, at the forefront of the fracking push, would adhere to the rules.


Shell’s Ho-Ho pipeline plagued by mechanical issues

Screen Shot 2014-02-10 at 16.29.29Extract from a Reuters article by Catherine Ngai published Tuesday 22 July 2014 under the headline: “Ho-Ho pipeline slow to start but pickup anticipated- traders”

(Reuters) – Royal Dutch Shell’s RDSs.L Houston-to-Houma pipeline meant to relieve bottlenecks in the country’s oil hub has been plagued by mechanical issues that have led the line to run below capacity though traders said on Tuesday volumes are expected to increase. The most recent data from the Louisiana Department of Natural Resources shows that the pipeline had a throughput of barely one-third of its capacity in each of the first four months of the year.


Death of 193 Dutch Strains Russian Relations for Shell, Heineken

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At one point the largest foreign investor in Russia, Shell declined to comment on whether its business would be affected after the downing of the plane. The company lost four employees in the incident, it said yesterday.

BloombergBusinessweek article by Celeste Perri, Maud van Gaal and Fred Pals published 22 July 2014

For centuries, the fortunes of the Netherlands, the wind-swept country carved out of North Sea wetlands, have relied on preserving the peace with its global trading partners. Last week’s downing of an airliner carrying 193 Dutch nationals is testing one of its most important relationships, involving companies from Royal Dutch Shell Plc (RDSA) to Heineken NV. (HEIA)

The Netherlands was Russia’s third-biggest trading partner last year, data compiled by Bloomberg show. The Dutch, home to the busiest container port in Europe and the region’s biggest energy company, send dairy products, meat and machinery to Russia, which the U.S. says is complicit in the attack.

“We’ve passed a turning point,” said Jan Melissen, a senior research fellow at Clingendael, the Netherlands Institute of International Relations. “Even for a trading nation, this is the point when you have to consider whether economic interests are outweighed by principles and values.”

While Malaysian Air Flight 17 was likely caught in military crossfire by a missile rather than a chosen target, it represents the gravest act of violence against Dutch civilians since World War II.

Unlike the U.S., the world’s biggest economy, the Netherlands has always had to be pragmatic when choosing trading partners. Since the founding of the Dutch East India Company, which carried spices from Indonesia back to the canals of Amsterdam, the Dutch set themselves apart from their European neighbors by focusing on financial interests.

Financial Interest

For a country smaller than West Virginia, the Netherlands has major trading relations with Russia. From 2011 to 2013, Dutch imports from Russia jumped 20 percent.

Dutch companies including the Port of Rotterdam, Shell and Heineken have a significant eastern exposure. The Port counts on Russia for 15 percent of all its throughput, while Heineken is a major brewer in the country.

Shell, which Deutsche Bank AG estimates has about $6.7 billion of oil and gas producing assets in Russia, is exploring for shale gas and plans to expand its Sakhalin-2 project there.

At one point the largest foreign investor in Russia, Shell declined to comment on whether its business would be affected after the downing of the plane. The company lost four employees in the incident, it said yesterday.

Screen Shot 2014-06-10 at 08.08.45“The demand is there and the Shell CEO has visited Russia more than any other nation since he took office to make the Sakhalin-2 expansion a reality,” said Bertrand Hodee, an analyst at Raymond James in Paris.

Deep Ties

Royal Philips (PHIA) NV has been selling in Russia since 1898, when Anton Philips got his first order for 50,000 light bulbs. The company, which lost two employees in the crash, called the incident “unacceptable,” while saying governments should lead the investigation.

Russia, where the company employs 1,000 people, accounted for 3 percent of Philips’ business last year. Paintmaker Akzo Nobel NV (AKZA) produces coil coatings in the Russian city of Lipetsk. Russians have also been increasingly consuming dairy products sold by Dutch food company Royal FrieslandCampina NV.

Ties between Russia and the Netherlands that stretch back to Tsar Peter the Great were the subject of a yearlong celebration in 2013. Even months after unrest between Russia and Ukraine had erupted, Dutch Foreign Minister Frans Timmermans stressed that relations between the countries were of great importance, suggesting that energy trade between Europe and Russia could help solve the crisis.

First Casualty

Timmermans changed his message today.

For the Netherlands, “all options are on the table as it is clear that things have changed since Thursday,” the minister said at a meeting in Brussels. “This is no longer about economy and trade only, but about security.”

The first casualty of the crisis is likely going to be new investment by Dutch companies in Russia, according to Marcel Stoeten, the secretary of the Netherlands-Russia center in Groningen, which was created to promote and support contacts between companies and governments of Russia and the Netherlands.

“I expect companies that were planning to do business in Russia will be hesitant at this point to pursue that, even without sanctions,” Stoeten said.

Another area that may come increasingly under fire is the Dutch practice of marketing itself as a tax haven to Russia.

Russia’s biggest oil, gas, mining and retail companies — including some run by billionaires close to President Vladimir Putin — have moved tens of billions of dollars in corporate assets to the Netherlands and other European countries. The firms include OAO Rosneft (ROSN), OAO Gazprom (OGZD), OAO Lukoil (LKOH) and Gunvor Group Ltd., a Geneva-based company that was co-founded by a Putin associate now under U.S. sanctions.

“We have always been against those tax haven constructions,” said Bram van Ojik, the leader of the GreenLeft opposition party. “This is a litmus test on how serious we are about sanctions as they can hurt us as well. We need to be prepared to shoot ourselves in the foot.”

To contact the reporters on this story: Celeste Perri in Amsterdam at [email protected]; Maud van Gaal in Amsterdam at [email protected]; Fred Pals in Amsterdam at [email protected]

To contact the editors responsible for this story: Jacqueline Simmons at [email protected] Benedikt Kammel, David Rocks


Nigerian Federal Government, Shell and the Ogoni: Treachery all round?

Screen Shot 2014-02-10 at 16.29.29Extract from an article by Ifeanyi Izeze published 21 July 2014 by

Without doubt, treachery has continued to be the defining attribute in the tripartite relationship between Shell Petroleum Development Company of Nigeria (SPDC) and the Federal Government on one side and the Ogoni people of Rivers state with the Rivers state government on the other. Each side has always tried to outwit the other by firing loads of lies from all sides to win sympathy from the outside world.


Qatar’s LNG Dominance Threatened by Shell’s Reported Withdrawal

Screen Shot 2014-02-10 at 16.29.29Extract from an article by Andy Tully published by oil on 21 July 2014

In 2013, however, one Shell well in Block D of the field came up dry, although Qatar had promoted it as a rich source of energy. As a result, Shell decided against even beginning a second exploratory well, anonymous sources told The Wall Street Journal. A person identified by The Journal only as a Shell spokesman said the first well had reached the depth planned to explore for gas, but “it did not encounter commercial volumes of hydrocarbons.” Now, he said, Shell is negotiating with QP and PetroChina on how to withdraw from the venture without drilling the second well.


Protecting Oil Installations in Nigeria

Screen Shot 2014-02-10 at 16.29.29Extracts from an article published 22 July 2014 by ThisDayLive under the headline: Protecting Oil Installations through Community Engagement

At a recent practical dialogue on the security and human rights practices of stakeholders involved in Nigeria’s oil and gas industry, especially within the Niger Delta operational basin, the Global Rights Nigeria disclosed that oil companies in the country might have spent over $53 billion securing their operational facilities between 2007 and 2011.

Global Rights, which is currently headquartered in Washington noted that it was possibile the federal government expended such huge amount of money in securing oil and gas operations within the Niger Delta, owing to the region’s poor history of human rights practices.

It was also revealed that Shell maintains a 1,200-strong internal police force, called ‘supernumerary’ or SPY police, in addition to a network of plain clothes informants; irrespective of Shell’s claims that it does not admit to allegations that the SPY police are usually armed, especially on escort duties and despite a law banning them from bearing firearms.


Legal challenge launched against Shell Centre decision

Screen Shot 2014-07-22 at 09.13.36Extracts from an article by Elizabeth Hopkirk and Ike Ijeh published by on 22 July 2014

An opponent of Squire & Partners’ Shell Centre development has launched a legal challenge in the High Court. Activist and writer George Turner claims communities secretary Eric Pickles’ decision to approve the £1.3 billion scheme last month was flawed and will unleash a planning free-for-all on the South Bank. He served the challenge on Pickles, as well as the mayor of London, Lambeth council, Shell and developer Braeburn Estates, a joint venture between Qatari Diar and Canary Wharf Group. The defendants now have two weeks to respond. They are expected to contest the validity of Turner’s challenge.


A Horrified Netherlands May Rethink Its Economic Ties With Russia

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Screen Shot 2014-02-10 at 16.29.29Extract from a BloombergBusinessweek article by Carol Matlack published 21 July 2014

The Netherlands, a nation of traders, generally doesn’t like to let politics interfere with business. The death of 193 Dutch nationals in the Malaysia Airlines  jet crash could change that.

Major Dutch companies with business interests in Russia also are drawing fire for their relations with President Vladimir Putin. “In April of this year, when the crisis over Crimea was at its height, [Royal Dutch Shell Chief Executive Officer] Ben van Beurden made a point of visiting Putin and saying that no matter the political situation, Shell and Russia had great plans for the future…”

The Netherlands has deep economic ties with Russia, ranging from Shell’s investment in the Sakhalin-2 oil and gas project…


Will Royal Dutch Shell Be Forced to Skedaddle From Russia?

Screen Shot 2013-10-01 at 07.59.11Extract from a Motley Fool article by David Smith published 21 July 2014 under the headline: “Will ExxonMobil, BP, and Royal Dutch Shell Be Forced to Skedaddle From Russia?”

Amid a crescendo of calls in Washington for the imposition of severely tightened sanctions on Moscow, following last week’s tragic shoot-down of a Malaysian airliner over Ukraine, I’m wondering whether in, say, six months, the likes of ExxonMobil, BP, and Royal Dutch Shell, will retain permission to work side-by-side with Rosneft and other Russian state-controlled energy companies.

Shell has a 27.5% interest with Gazprom in Sakhalin-2 on a desolate, eponymously named island in the Sea of Okhotsk, to Russia’s east. Until 2006 Shell operated the project, but late that year it was forced to sell much of its then majority interest to Gazprom, for what was generally agreed to be a pittance, relative to the $20 billion the company had already invested in the project.


Few limits offshore, Shell says

Screen Shot 2014-02-10 at 16.29.29Extract from a UPI article by Daniel J. Graeber published 21 July 2014

LONDON, July 21 (UPI) –John Hollowell, Shell’s vice president in charge of deep waters in the Americas, told The Daily Telegraph in London there were few limitations to how deep or how far offshore oil companies can drill.

“How far you can go is really technology based,” he said in an interview published Sunday. “When we can’t overcome the technical barriers, that will be the end, but we have yet to reach that stage.”

The company said it’s working according to the terms of the new safety culture that emerged in the wake of the 2010 oil spill in the Gulf of Mexico.


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