By Fiona McGarry
Massive losses incurred by Shell E&P Ireland Ltd, one of the major shareholders in the Corrib gas field, have been described by Shell to Sea as more evidence of ‘mismanagement’ of the project. The lobby group also said the company was now reaping the financial implications of failing to consult with the local community.
This week, Shell E&P posted an operating loss of nearly €50 million for 2005. This is an increase of 200 per cent on losses posted for 2004, which were in the order of €14.8 million.
The company’s latest profit and loss account showed accumulated losses of €90 million, and the shareholders’ fund, which would have to be paid if the company was wound up, stands at €383 million.
In a statement, Shell to Sea said the figures were “further evidence of Shell’s poor management of the project.” The group said that if the company had “properly considered the project in consultation with the local community the Corrib gas would now be flowing. A corporate culture that ignores the community directly affected by its projects is not only unethical and inefficient – it is also bad for the company’s own business.”
Shell to Sea said the company should now “change the Corrib gas project in agreement with the community affected by the project. It is time for the government to insist that this happens and that real benefits accrue to the country.”
In its account statement, Shell E&P acknowledges that during the course of 2005, “relationships with the local community deteriorated”.
According to the accounts just filed, the company plans to spend a further €81 million on the field, and employed 45 people in the period under review.
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