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USA TODAY: Shell Oil tries different path to engage public opinion

By David J. Lynch

RICHMOND, Va. — A few dozen strangers mill awkwardly around the hotel ballroom, fortified by the open bar and a buffet table laden with stuffed mushrooms and melt-in-your-mouth beef carvings.

This could be the early moments of a dance, a bar mitzvah or a self-help seminar. But instead, it’s an unusual event hosted by a representative of “Big Oil,” deep into a long-shot mission to repair the industry’s rapacious image and, not so incidentally, advance its political agenda.

John Hofmeister, 59, president of Houston-based Shell Oil, represents a multinational oil giant that just days before this early May gathering reported profit of nearly $7 billion for 90 days work. But he disarms his invited guests, who range from supportive state politicians to deeply skeptical environmentalists, within moments of welcome.

“We know for a fact the favorability rating of oil companies today ranges from 10% to 15% favorable. … It’s hard to go much lower,” he says. “Of 21 major industries, we’re (ranked) 21. That’s not where we want to be.”

Oil men generally aren’t given to self-doubt or public introspection. Touchy-feely, after all, doesn’t get the drill bit a couple of miles beneath the earth where the crude hides. But with oil prices above $60 a barrel, companies such as Shell find themselves with more cash than cachet. The industry’s image plunged after Hurricane Katrina in 2005, when prices at the pump jumped and consumers fumed, and it’s never quite recovered.

Executives surprised by backlash

In an interview, Hofmeister says Shell executives were dumbfounded by the vitriol that crisis unleashed, and concluded they had to respond. They debated spending millions on a new ad campaign or offering consumers special discounts, but ultimately opted to implement a strategy that the United Kingdom unit of multinational Royal Dutch Shell had used with some success.

That explains why Hofmeister finds himself this night in a Sheraton just off the highway, playing 20 questions with a group of Virginians selected by Shell’s public relations agency, Burson-Marsteller.

A beefy man with a professorial air, Hofmeister’s expertise lies in human resources, not hydrocarbons. And it shows, as he deftly fields even the most pointed questions, constantly projecting an image of even-tempered reasonableness.

Michael Glasser, a Norfolk lawyer and environmentalist, at one point challenges him to undertake a “bold stroke” by advocating higher auto fuel economy standards. Hofmeister bathes him in warmth — “That’s a very good question and a very good challenge, and I welcome it” — before demurring.

At other times, the Shell executive embraces the need for action on climate change — though not a dramatic break with fossil fuels — and speaks favorably of the (long-term) potential of alternative energy sources such as hydrogen.

Much of the roughly 90-minute event is consumed by small-group discussions led by Shell executives. Sipping drinks, people cluster in knots around easels bearing questions such as: “What does the U.S. need to do to manage energy demand?” Later, each of three Shell executives briefly summarizes for the broader group what had been discussed.

A pitch to tap offshore oil

That there is more to the evening than fellowship becomes clear in Hofmeister’s frequent allusions to the need to tap into offshore oil reservoirs. For 25 years, Congress has kept those deposits off-limits, following a major oil spill off of Santa Barbara, Calif.

The Interior Department last month proposed opening an area 50 miles off Virginia’s southern coast to drilling, and Shell would like to encourage public support for the idea, which remains controversial and requires congressional approval. The company says technological improvements mean such drilling can be done with little risk of environmental damage.

Securing access to prohibited offshore deposits has long been an oil industry priority. But Hofmeister insists Shell’s new outreach is genuine, that it’s more than a repackaging of “Big Oil’s” traditional wish list.

“The winds of change are upon us. Anyone that doesn’t recognize it is missing the point,” he says with feeling. “The American people have had enough of such extraordinary dependence upon foreign imports. They’ve had enough of not feeling they are included in the debate over alternatives. … There is enormous worry and fear about future supplies, reliable supplies.”

Shell won plaudits from many attendees for reaching out to the public. Yet, there is an evident tension between Hofmeister’s diagnosis of a critical moment that demands new thinking and his prescription that what Shell always has favored — incremental technological progress — will still provide the good life.

Pump prices can fall, sales can rise, the climate can be cleansed, all seemingly without sacrifice. Says Hofmeister: “I think we can have it all.”

Comments: (1)

John Donovan wrote: <1m ago

John Hofmeister should be called John Spinmeister. The track record of Shell Oil in terms of integrity and the environment does not inspire confidence. The sale of tainted gasoline in the USA and Canada, participation in price fixing cartels, the tragic explosion at a Shell Oil refinery in Norco in which six people lost their lives, Clean Air Act violations, repeated environmental infringements in Louisiana, a pipeline rupture in Washington State which resulted in an explosion and more deaths, repeated multimillion dollar fines for groundwater contamination, more fines for unauthorised venting and flaring of gas.

Details can be found on Wikipedia at http://en.wikipedia.org/wiki/Controversies_surrounding_Royal_Dutch_Shell

Shell has also been guilty of causing hellish pollution in Nigeria for decades, engaging in corruption with successive Nigerian regimes to plunder billions in oil revenues, while leaving the local population to live in abject poverty. The following link is to a leaked Shell confidential internal report in which Shell admits that its operations in the Niger Delta have fuelled corruption and violence.

http://www.shellnews.net/2004%20Documents/peaceandsecurity/peaceandsecurityinthenigerdeltawebpage.htm

Posted by John Donovan, co-owner of the website: http://royaldutchshellplc.com/

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

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