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Shell Gannet Alpha platform in trouble again

Feb 9th, 2012
by John Donovan.
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By John Donovan

It seems that Shell’s Gannet Alpha platform has had another close call.

On Monday workers were evacuated and production shut down after natural gas began seeping out from under the platform.

All of the ingredients for a disastrous explosion, of the kind that occurred in the Gulf of Mexico, which almost brought about the demise of BP and the explosion on Shell Brent Bravo, resulting from Shell management (Malcolm Brinded) failing to take adequate action after a safety audit exposed a “Touch F*** All” safety culture and falsification of safety records.

Printed below is a comment from a Shell North Sea Platform Safety & Maintenance Expert on the recent oil spill near the Gannet Alpha Platform.

…another example of reactive maintenance regime, i.e. allowing, through neglect, equipment to fail and then reacting to the failure rather than, as the Safety Case for Gannet prescribes, preventing failure in the first instance by application of appropriate maintenance, inspection and monitoring.

(Expert in question may be available to the media for comment)

It seems that not much has changed. Production, profits and FAT CAT bonuses take priority over the safety of offshore workers.

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Shell Gannet Alpha platform evacuated over gas leak

Feb 9th, 2012
by John Donovan.
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9 February 2012

Nearly 50 workers had to be evacuated from a North Sea oil platform after natural gas began seeping out beneath it, it has emerged.

Shell said staff were taken off the Gannet Alpha installation on Monday as a precaution. Production was shut down.

The oil giant said the incident was not linked to last August’s leak of more than 200 tonnes of oil from a pipeline beneath the Gannet Alpha.

The Health and Safety Executive is investigating.

The Gannet Alpha oil platform is 113 miles (180km) off Aberdeen.

SOURCE ARTICLE

Royal Dutch Shell Gets Comfortable in Papua New Guinea

Feb 9th, 2012
by John Donovan.
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FEBRUARY 9, 2012

By David Winning

Royal Dutch Shell is getting serious in its pursuit of a piece of Papua New Guinea’s oil and gas wealth.

Around six months after signing a strategic alliance with Papua New Guinea’s state oil company, the Anglo-Dutch oil major is setting up a representative office in the impoverished Southeast Asian nation.

Shell’s strategic alliance with Petromin, signed Aug. 18, includes a joint study of major basins in Papua New Guinea with the potential to contain big oil and gas deposits. The study is due to be completed this year, and could be a springboard for Petromin and Shell to participate in projects together.

“The opening of the office affirms Shell’s interest to invest in Papua New Guinea and offers opportunities for us to work more closely with our partner, Petromin,” Ton Ten Have, Shell’s Vice President Commercial Asia, said in a prepared statement.

According to a BP study, Papua New Guinea had 15.6 trillion cubic feet of proven reserves of natural gas at the end of 2010. That figure likely underestimates the true resource as Papua New Guinea has been lightly explored up to now.

“We welcome the increased presence of Shell and believe it will further facilitate our close cooperation for future opportunities in Papua New Guinea,” said Joshua Kalinoe, Petromin’s managing director. “Together with Petromin, Shell will help Papua New Guinea realise the full potential of its energy resources.”

Shell’s move comes as several companies look to bring in partners on projects in Papua New Guinea.

InterOil said Sept. 30 it had mandated Macquarie Capital, Morgan Stanley and UBS to find a strategic partner for its proposed multibillion dollar Gulf LNG project. Citing a person familiar with the situation, Deal Journal Australia reported Feb. 7 that Korea Gas is in talks to form a consortium with Mitsui and Japan Petroleum Exploration to join InterOil’s project.

Separately, Canada’s Talisman Energy last year appointed Sydney-based advisory RFC Corporate Finance to find an investor for four licenses in the forelands of western Papua New Guinea, which contain a mix of gas discoveries and exploration targets.

ASX-listed Oil Search also opened a data room on its offshore gas fields in the Gulf of Papua in the final quarter of 2011, and has already held preliminary talks with international companies with LNG expertise.

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Motiva Port Arthur FCC, Alky, HCU back in production -sources

Feb 9th, 2012
by John Donovan.
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HOUSTON | Wed Feb 8, 2012 8:58pm EST

Feb 8 (Reuters) – Motiva Enterprises’ 285,000 barrel per day (bpd) Port Arthur, Texas, refinery returned a gasoline-producing fluidic catalytic cracking unit, an alkylation unit and a hydrocracking unit to production on Wednesday following a Tuesday power outage, said sources familiar with refinery operations.

The units were ramping up to full production rates on Wednesday night, the sources said. A brief power outage on Tuesday morning knocked the units out of production, according to a notice the refinery filed with Texas pollution regulators.

Motiva is a 50-50 joint venture between Saudi Refining and Shell Oil Co, the U.S. unit of Royal Dutch Shell Plc.

SOURCE ARTICLE

Debate continues on Big Oil’s big profits

Feb 8th, 2012
by John Donovan.
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February 7, 2012, 2:23 p.m

The five so-called “super major” oil companies — Exxon Mobil, Royal Dutch Shell, ConocoPhillips, Chevron and BP– have just wrapped up their fourth quarter earnings reports, but not without inspiring disdain over how they made those billions in profits and over what they were doing with them.

Under the title “Big Oil’s Banner Year,” the Washington-based Center for American Progress on Tuesday, for example, pointed out that the five firms made a fourth-quarter record $137 billion in profits while producing less oil than they did the previous year.

The center said that the oil companies produced 15.6 million barrels a day in the fourth quarter compared to 16.2 million barrels a year earlier. The center also said that the oil giants were sitting on $58 billion in cash reserves while enjoying federal tax reductions they didn’t deserve.

“Instead of using their additional earnings to increase production or investment in alternative fuels,” the report said, the oil companies “used $38 billion, or 28% of annual net income, to repurchase their own stocks and invested in politicians to maintain the policies that led to their enormous profits over the past decade.”

The center also complained that the profits were reported during a year in which Americans paid the highest fuel bills on record for products like retail gasoline. The Center for American Progress’ data and its report can be found here.

But an official with the American Petroleum Institute said that Americans should be celebrating the same success, at least for Irving, Texas-based Exxon Mobil, San Ramon, Calif.-based Chevron and Houston based ConocoPhillips.

“When these companies do well, the tens of millions of Americans who have pension plans and 401(k)s that invest in oil companies also benefit,” said Rayola Dougher, senior economic advisor at the institute. “Over 97% of the ownership in these companies are in IRA accounts, pension plans, mutual funds, and individual investor accounts.”

Dougher said that California’s pension plans for public employees, for example, had about 4.4% of their investments in the oil industry between 2005 and 2009 and obtained a 17.1% return on them.

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Copyright © 2012, Los Angeles Times

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Rise In Oil Thefts Threatens Nigerian Output

Feb 8th, 2012
by John Donovan.
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Published February 07, 2012 Dow Jones Newswires

IBADAN, Nigeria — Royal Dutch Shell PLC’s (RDSA) unit in Nigeria has said a rise in thefts of crude from its new Nembe Creek pipeline is jeopardizing the production and export of oil in Nigeria’s Niger Delta.

Currently 140,000 barrels of oil per day is transported along the pipeline that takes most of the Shell Petroleum Development Company of Nigeria Ltd.’s and third party crude oil production in Eastern Swamp operations to the Bonny Terminal in the Niger Delta.

“The level of crude theft at Nembe Creek Trunkline can no longer be tolerated,” said SPDC Managing Director, Mutiu Sunmonu, in Port Harcourt, capital of oil-producing Rivers state.

“It is difficult to sustain production in the circumstances as we have to shut down when a facility trips and fix the cause before restarting. This happened three times just between the 26th and 30th of January,” Sunmonu said Monday.

“We have increased surveillance of the route so we can detect crude theft activities and respond early to spills, but what is urgently needed is robust intervention at federal, state and local government levels. We need increased patrols of creeks and waterways, removal of illegal offtake points and dismantling of illegal refineries,” SPDC said.

The pipeline was shut in December because of leaks caused by thieves. Since those repairs were completed more than 50 valves (created by thieves to siphon off the oil) have been discovered, Tony Okonedo, SPDC spokesman, said in a statement Monday. In one case, some 17 of these valves were found within a 3.8 kilometer stretch.

Helicopter overflights Monday confirmed thefts of crude is thriving in southern Nigeria’s Rivers and Bayelsa states. As well as valves some other connections were made directly to wellheads, the statement said.

More than 75% of all oil spill incidents and more than 70% of all oil spilled from SPDC facilities in the Niger Delta between 2006 and 2010 were caused by sabotage, theft and illegal refining, Okonedo said.

Copyright © 2012 Dow Jones Newswires

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Mystery of how Shell escaped Brent Bravo criminal prosecution

Feb 7th, 2012
by John Donovan.
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The Sunday Times article may go some way to illuminating the mystery of how Shell miraculously escaped criminal prosecution.

By John Donovan

An article published in Scotland by The Sunday Times may help to explain why the health and safety division of the Crown office and Procurator Fiscal Service decided not to prosecute Royal Dutch Shell for alleged criminal offences arising from an explosion on the Brent Bravo platform.

In 2005, Shell was fined a record £900,000 at Stonehaven Sheriff Court, for a series of safety failings on the platform which led to a gas leak inside the giant platform’s utility leg and the tragic deaths of two workers, Keith Moncrieff and Sean McCue.

Former Shell International HSE Group Auditor, Bill Campbell, revealed that Shell had operated a “Touch F*** All” safety culture on the platform and that safety records had been falsified. He reported this to Malcolm Brinded, the then Managing Director of Shell Expro, who failed to take proper action. This was before the explosion.

Mr Campbell later courageously provided evidence, which resulted in Grampian Police conducting a long investigation into related alleged bribery and corruption of HSE officials by Shell. The police passed the case file to the Procurator Fiscal Service for a decision on whether to prosecute.

Mr Campbell was surprised when the Procurator Fiscal Service announced that it had dropped the case because there was insufficient evidence to justify a criminal prosecution. He was even more surprised to discover that NO witnesses were ever interviewed from the list he had provided to the Police. Neither witnesses from Shell or HSE.  Or indeed, the independent witnesses who could have provided corroboration.

Mr Campbell still maintains that there is an abundance of evidence provided by Shell employees and by HSE as a result of their internal investigation and through information released under the Freedom of Information Act. He remains utterly baffled why witness statements were not requested from the Procurator Fiscal by Crown Counsel.

The Sunday Times article may go some way to illuminating the mystery of how Shell miraculously escaped criminal prosecution.

It is alleged that Scottish prosecutors cherry-pick the easiest “slam dunk” cases. This would explain a 99% success rate. They allegedly do not pursue health and safety cases which are “slightly more difficult”.

Bill Campbell handed over a wealth of evidence, but for some reason, it was not properly followed up by the Procurator Fiscal, leaving Mr Campbell and apparently Grampion Police, mystified by the outcome.

The Sunday Times 5 February 2012

Lord advocate ‘takes only easy health and safety cases’

SCOTLAND’S top prosecutor has been accused of inflating the conviction rate in health and safety proceedings by only targeting so-called “slam dunk” cases where success is almost guaranteed.

Lord advocate Frank Mulholland has defended the claims which have been raised at Westminster, insisting every case placed before him will be taken on, regardless of difficulty.

Since the health and safety division of the Crown office and Procurator Fiscal Service was set up in 2009, 77 of the 78 completed cases have resulted in convictions – a success rate of 99%.

However, while appearing before the Commons Scottish affairs committee, he was accused by chairman Ian Davidson of cherry-picking the easiest cases.

The Scottish Labour MP asked whether, given the number of fatalities and reported serious accidents in Scotland, he thought he was taking on enough prosecutions.

Davidson said: “There’s a chance they are not pursuing the cases which are slightly more difficult. So paradoxically, this is one situation where having a lower success rate is possibly better.

“Our initial suspicion is they are restrained in terms of manpower and therefore they are only pursuing prosecution in those cases which we describe as slam dunk. That would worry us quite a bit.

“If they are not being passed on to him, the question is whether they are being filtered out at an earlier stage in the process before they get to him. It may be that those who are passing them on to him are taking too cautious a view of what might be prosecutable.”

He added: “We have been worried for some time about the high rate of health and safety-related deaths and serious injuries in Scotland. There are more people in agriculture, quarrying, construction, but that didn’t explain all of it.

“If someone is getting a 1Wlo success rate with prosecutions, then it potentially means they are only taking ones where they are.absolutely certain of a success. Our concern is that there is a filter which removes difficult cases.”

There has been a number of high-profile health and safety prosecutions in Scotland in recent years, including the Stockline Plastics explosion in Glasgow’s Maryhill in 2004 which claimed nine lives.

Operators ICL Plastics and ICL Tech were fined £400,0000 after admitting four charges. The High Court in Glasgow, heard that the leaking pipework that caused the explosion could have been replaced for just £405.

Utility firm Transco was fined a record £15m after being convicted on a charge arising from an explosion which killed four people. Andrew and Janette Findlay and their children Stacey, 13, and Daryl, 11, died in the explosion in Larkhall, South Lanarkshire, in December 1999.

Transco was found guilty after a six-month trial in Edinburgh of breaching health and safety laws.

A Crown Office spokesman rejected the suggestions.

He said: “If we have sufficient admissible, credible and reliable evidence, and it is in the public interest to prosecute, then we will prosecute.

“The excellent record of the health and safety division is due solely to the diligence and expertise of our prosecutors, who work extremely hard to secure guilty pleas and convictions in the most complex of cases.

“The lord advocate made the committee aware that 219 eases had been reported to the health and safety division since its inception. Of those, 78 have been prosecuted and 77 have resulted in convictions. There are 116 live cases under consideration for which no decision has been taken.

“Ten cases have resulted in a Fatal Accident Inquiry. No proceedings have been taken in 15 cases. In six of those cases proceedings could not have been taken because the company was no longer trading.

“In another five cases proceedings could not have been taken because there was insufficient evidence in law.”

http://www.publications.parliament.uk/pa/cm201012/cmselect/cmscotaf/uc1344-vii/uc134401.htm

Shell CEO Peter Voser €6.75 million salary plus €3.5 million bonus

Feb 6th, 2012
by John Donovan.
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I doubt that Mr. Voser will emulate Network Rail bosses in the face of a widespread public backlash against Fat Cat bonuses and waive his Fat Cat bonus, as they have, to improve safety? Fat chance.

By John Donovan

According to a report filed on Monday with the U.S. Securities & Exchange Commission, Peter Voser, the Swiss Chief Executive of Royal Dutch Shell Plc received €6.75 million in salary for 2011 plus a bonus of €3.5 million, a combined total of over €10 million.

Voser wants half of his bonus (€1.75 million) paid in shares. The full details of the bonuses at the top of Shell will not be known until publication of the annual report of the company.

Peter Voser was in 2010 the highest paid director of any Dutch listed company.

This is the gentleman who as part of his Vosification plan, asked hundreds of senior Shell managers to reapply for their own jobs.

I doubt that Mr. Voser will emulate Network Rail bosses in the face of a widespread public backlash against Fat Cat bonuses and waive his Fat Cat bonus, as they have, to improve safety? Fat chance.

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Shell raises alarm over oil theft

Feb 6th, 2012
by John Donovan.
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FEBRUARY 6, 2012

LAGOS (AFP) – Shell raised the alarm on Monday over repeated damage to a key pipeline in southern Nigeria by what it said were thieves seeking to siphon off crude for sale on the lucrative black market.

The Anglo-Dutch oil giant said the Nembe Creek Trunkline had been hit by an increased number of attacks by thieves “barely 16 months after the old line was replaced due to repeated sabotage attacks.”

While highly organised crude theft — locally called “bunkering” — has long been a major problem in Nigeria, Africa’s largest oil producer, authorities have warned that the practice has been on the rise.

It involves thieves tapping pipelines to siphon off oil either to be sold as crude or to be treated at makeshift refineries. The oil is often directed toward waiting vessels.

“On the 24th of December last year, the line was shut down because of leaks caused by two failed bunkering points, and since repairs were completed, more than 50 theft valves have been discovered,” a Shell statement said.

“In one case, some 17 illegal bunkering points were found within a distance of 3.8 kilometres.”

Mutiu Sunmonu, head of Shell’s Nigerian joint venture SPDC, said in the statement that “the level of crude theft at NCTL can no longer be tolerated.”

“It is difficult to sustain production in the circumstance as we have to shut down when a facility trips and fix the cause before restarting,” he said. “This happened three times just between the 26th and 30th of January.”

Shell resumed production on the line January 23 after repairs due to the December incident, which led it to declare “force majeure,” a legal term indicating it may not meet contractual obligations due to events beyond its control.

The line’s current daily output is 140,000 barrels per day, Shell said.

Shell says the vast majority of oil spills in recent years in the oil-producing Niger Delta region, badly hit by years of pollution, have been caused by sabotage, theft and illegal refining.

However, activists say Shell has not done enough to prevent such spills, and a UN report issued last year took Shell’s Nigerian joint venture to task over oil pollution.

The report said Shell’s procedures for control and maintenance of infrastructure had not been followed and spills had also not been sufficiently cleaned.

SOURCE ARTICLE

Shell, UOP Among Companies Put on Blacklist by Iran, Mehr Says

Feb 6th, 2012
by John Donovan.
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By Ladane Nasseri – Feb 6, 2012 4:10 PM GMT

Iranian Oil Minister Rostam Qasemi has ordered five European companies, including Royal Dutch Shell Plc, to be put on a blacklist for failing to meet their commitments in the nation’s refinery projects, Mehr reported.

Shell and UOP LLC, a unit of U.S.-based Honeywell International Inc., were among the companies named in the report published today by the state-run news agency.

Qasemi “ordered the National Iranian Oil Products Refining and Distribution Co. to halt foreign purchases of license in the country’s refinery projects at a time of increasing sanctions and lack of commitment of foreign companies,” according to the news agency.

‘These companies will have no role in the future in Iran’s oil and gas industries,” Mehr said, citing the refiner.

Iran is in conflict with western countries over accusations that it is using its nuclear program as a cover for developing weapons, a charge the government denies. European Union foreign ministers agreed on Jan. 23 to ban Iranian crude oil imports starting in July and freeze the assets of the country’s central bank, measures that come in addition to previous United Nations, U.S. and EU sanctions.

To contact the reporter on this story: Ladane Nasseri in Dubai at lnasseri@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net

SOURCE ARTICLE

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