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Modest CEO who “healed” oil major Shell

REUTERS

Fri Jun 26, 2009 8:25am EDT

By Tom Bergin

LONDON (Reuters) – Jeroen van der Veer rebuilt Royal Dutch Shell Plc’s (RDSa.L) confidence after a reserves overbooking scandal but his conservative Calvinist roots meant he never took too much credit for it.

Van der Veer, 61, steps down as chief executive on June 30, after announcing his retirement last year, to be replaced by Shell’s Chief Financial Officer, Peter Voser.

Van der Veer took the top job at Shell — then a partnership of separate Dutch and British entities — in 2004 after the company admitted massively overstating its oil and gas reserves – the key metric on which oil companies are valued.

The reserves scandal led to the departure of the group’s boss, Phil Watts, and other top executives and caused the group’s shares to dive.

The low-key Dutchman was seen as a safe pair of hands after the brash and aggressive Watts, whose penchant for deliberately hard-to-achieve stretch targets was partly blamed for the reserves scandal, and the next big scandal to rock the company — delays and cost overruns on big projects.

“This was a fairly wounded company at the time,” Shell board member Peter Job said. “The reserves issue had come as a great shock to staff. Jeroen came forward as the person who healed injured feelings.”

Van der Veer led the unification of the UK and Dutch companies, helping to streamline the group’s notoriously slow decision-making structures. He also took a hands-on role in overseeing the company’s biggest projects.

Despite lacking a background in exploration, the former chemicals division boss put building the upstream portfolio at the forefront of his strategy.

If van der Veer was a contrast to his predecessor, he was an even greater one to the dominant figure in Europe’s oil industry at the time, John Browne, the CEO of rival BP Plc (BP.L).

While Browne wore fine tailored suits and was always impeccably coiffed, van der Veer’s suits hung uneasily on his tall frame and were often decorated with Shell-issue ties bearing the company’s Scallop-shell logo.

MODEST

Van der Veer also differed from Browne in shunning a high media profile. Even when the Shell boss became more comfortable in front of reporters, he maintained a modest approach.

When asked to reminisce, earlier this year, on his success in turning around Shell, the CEO said:

“I come from a Calvinistic country … One of the values we have is, you simply work and you try to do good but you can’t say about yourself or your company that you are pleased about it,” he added.

While analysts and investors generally speak well of his tenure, most note that in the oil industry, the decade or more long germination period for big projects means a CEO’s success or failure is often felt after they stand down.

One of Van der Veer’s key strategic moves was to accelerate a charge into unconventional oil projects.

Accepting that the big, easy-to-access fields in the Middle East and elsewhere would be reserved for state oil companies, van der Veer focused on large complex projects such as Pearl in Qatar which will make motor fuel from natural gas and on projects to squeeze crude from Canada’s oil sands.

Many of these projects need high oil prices to offer good returns and are prone to cost increases, so whether the bet pays off for Shell will take years to become clear.

At the end of his term, van der Veer scaled back new investments in renewable energy, a move for which Shell was criticized by environmentalists but which reflected a broader trend in the industry.

Van der Veer, who has worked at Shell since 1971, will join the company’s board as a non-executive director after he steps down and remains a director at Anglo-Dutch consumer goods maker Unilever (ULVR.L).

He is married with three daughters and lists visiting museums and playing golf — he has a 16 handicap — as hobbies. He has twice participated in the “Elfstedentocht’, a 200 km skating race between 11 cities in the Netherlands.

He said he never had any ambition to become CEO and speaks most fondly of his time as head of the Pernis refinery near Rotterdam. He said in an interview on Shell’s website:

“All jobs have their charms, but running Pernis was a job I think I could have done forever.”

(Editing by Jon Loades-Carter)

� Thomson Reuters 2009 All rights reserved

REUTERS ARTICLE

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