Posts under ‘Forbes’

Why The Oil Industry’s $400 Billion Bet On Plastics Could Backfire

Scott Carpenter: Senior Contributor: Energy Sept 5, 2020Key takeaways:

• Oil companies plan to invest $400 billion into new petrochemical plants, betting that demand for plastic will keep growing.
• Authors of a new report say the industry and other forecasters fail to consider that large majorities favor legislation to curb plastic use and waste and that governments are acting.
• Plastics impose a cost of $1000 per tonne — through CO2 emissions, air pollution, and collection costs. Calls to shift those costs onto producers through taxes are growing.
• Outside experts said the long-term outlook for plastics demand remains uncertain and will depend on consumer preferences and government actions.

The COVID-19 pandemic and accelerating green growth around the world have eviscerated many of the oil industry’s dogmas: that renewables would suffer from high costs, that governments would slow-walk environmental commitments, that investors would continue to reward long-term bets on oil with generous market values.

But one nugget of wisdom has survived everything the market has thrown at it, and now oil companies like ExxonMobil and Shell are wagering billions on it: that the world’s demand for plastics is still growing, with no end in sight. read more

Big Oil Asset Write-Downs Are Not The End Of The Oil Age

Tilak Doshi: Contributor Energy: Aug 23, 2020

Climate change activists have long lobbied for divestment from fossil fuel-producing companies. They have largely failed in this quest. This year, the steep falls in the value of the large oil and gas companies, however, occurred with a rapidity that astonished market watchers. Within weeks, the coronavirus pandemic and the oil market-share battle between Saudi Arabia and Russia launched after the collapse of the OPEC+ talks in early March led to unprecedented falls in Big Oil equity. read more

By John Donovan

Successive Royal Dutch Shell CEO’s cannot say that they were not warned time and again in chilling terms about the Prelude “experiment”, the description used in a Forbes article published today.

The links below are to a series of articles, initially triggered by a well-placed whistleblower directly involved in the Prelude project. Includes articles by Mr Bill Campbell, the retired distinguished Shell Global Safety Consultant and another retired Shell guru with a track record of spotting potential pitfalls in major Shell projects. read more

A series of recent events highlight the challenge Shell has ahead of it with Prelude, and plans for sister vessels which are supposed to follow.

Last week Royal Dutch Shell did something that would have been nearly unthinkable at the beginning of this year. The company cut its dividend for the first time in 75 years.

This is remarkable considering the ups and downs of the oil industry of the past few decades. Prices have collapsed many times since then, albeit we have never before seen a major benchmark turn negative.

But the COVID-19 pandemic has hit oil demand in an unprecedented way. A few days ago Bloomberg posted an article showing that energy demand has just dropped by the largest percentage since World War II (which was the last time Shell cut its dividend). read more

Jan 24, 2020

The fossil fuel industry faces a dilemma similar to what confounded big tobacco a generation ago, according to economist and energy specialist Peter Sainsbury.

Speaking on the Contrarian Investor Podcast, Sainsbury says oil companies in particular are starting to be seen as “sin stocks,” with institutions divesting themselves on ethical grounds. But therein lies the opportunity. Much like tobacco companies reinvented themselves in the 1990s, energy companies can undergo a similar renaissance. Indeed the process of oil companies divesting harmful assets is already underway. This causes opportunities for investors. But first, headwinds can be expected. read more

Shell India’s inclusive culture sustains a diverse and engaged workforce

BY RAJIV SINGH: PUBLISHED: Aug 13, 2019 

In managing human resources, what may sometimes get overlooked is the human element. But Nitin Prasad, chairman of Shell in India, is not one to miss the larger picture.

Sample this. When asked what makes Shell one of the best employers in India, he says it’s the company’s 8,700 employees. Shell believes in collectively shaping a work environment that prioritises diversity and inclusion; promotes a culture of open innovation; observes equality for all genders and prioritises focus on ethical behaviour. read more

Royal Dutch Shell chief executive Ben van Beurden speaks at a full year results conference in London on January 31, 2019. – Royal Dutch Shell today said that net profit surged 80 percent to $23.4 billion in 2018, thanks to higher oil prices and cost: AFP/GETTY IMAGES

Fifteen years later, peak oil is still talked about by some, but most industry insiders pay it no heed. Instead, over the last few years, the increasingly popular concept has been peak demand. Peak demand is the idea that the demand for oil will reach an apex and then start to decrease, especially as government regulations require more use of alternative energies and as battery-powered machines, like electric vehicles, will presumably become more popular.

Peak demand may or may come to pass—that is not the concern here. What we do know is that if the peak demand idea continues to gain popularity it will lead to a shortage of oil in the coming years and decades. The idea of peak demand threatens the global oil supply because it incentivizes and even excuses oil companies to stop exploring for and producing (E&P) more oil. read more

Royal Dutch Shell and Italy’s Eni have been embroiled in a legal battle since 2011 over an alleged $1.1 billion paid in bribes to Nigerian government officials,  related to the acquisition of new off-shore drilling rights. Nigeria is now counter-suing for $1.14 billion (868 million British pounds) in a London court…

Ariel Cohen: Contributor, Energy: April 15. 2019

With the reelection of Muhammadu Buhari to the Nigerian presidency, Africa’s leading oil exporter faces a challenge as old as Nigeria itself: political corruption. This scourge shortchanges ordinary Nigerians and undermines the country’s development.

Royal Dutch Shell (NYSE:RDS-A) and Italy’s Eni (NYSE:E) have been embroiled in a legal battle since 2011 over an alleged $1.1 billion paid in bribes to Nigerian government officials,  related to the acquisition of new off-shore drilling rights. Nigeria is now counter-suing for $1.14 billion (868 million British pounds) in a London court, claiming that Shell and Eni assisted “corrupt Nigerian government officials to breach fiduciary duties” in the deal. This scandal comes after a leaked 2013 report, which details how Nigeria’s National Petroleum Corporation (NNPC) owed the government $20 billion in revenue due to its failure to report its earnings. It seems there is no shortage of legal quagmires for Africa’s most populous nation. read more

Angry Dutch citizens on Thursday will ask their country’s highest court to put an immediate end to gas production in the Groningen region due to the risk of life-endangering earthquakes. read more

Claire Poole , CONTRIBUTOR: June 6, 2018

Royal Dutch Shell took the top spot among oil and gas companies on the Forbes Global 2000’s list of the biggest and most powerful public companies, surpassing last year’s leader Exxon Mobil Corp. The Anglo-Dutch oil and gas giant ranked 11th among all companies on the list, up from 20th the previous year, mostly because of higher sales due to lofty commodity prices. Irving, Texas-based Exxon came in at 13th, the same as last year. The Forbes Global 2000 is determined by a composite score of equally weighted measures of revenue, profits, assets and market value. FULL ARTICLE read more

By John Donovan 

Trump’s withdrawal from the nuclear deal with Iran, which has pushed up the price of oil, thus benefiting Shell and other oil companies, threatens to put billions of dollars worth of trade in jeopardy.

Shell has a record of treacherous conduct involving the Iranian regime, including using subterfuge to disguise shipping movements.

How will Shell react this time in an even more complex situation?

Below are extracts from articles published in the last 24 hours.

Sky News: How business could be hit by Iran deal pull-out read more

Michael Lynch , CONTRIBUTOR: APR 3, 2018: Opinions expressed by Forbes Contributors are their own.

The internet is going gaga over Royal Dutch Shell’s new “Sky” scenario, which discusses the impact on the energy industry of efforts to limit climate change.  Many treat the existence of such a scenario developed by a major oil company as evidence that a) an important oil industry player expects this to happen, b) projections of a severe climate policy future are validated. Writing as an aged methane emission, this is not really new.  In the 1990s, Shell was cited by many environmental advocates for appearing to have sided with them.  As Curtis and Romm said in 1996, “Imagine another world in which fossil-fuel use had begun a slow, steady decline; more than a third of the market for new electricity generation was supplied from renewable sources; the renewables industry had annual sales of $150 billion; and the fastest-growing new source of power was solar energy. An environmentalist’s fantasy, right? No, that’s one of two planning scenarios for three to four decades from now, developed by Royal Dutch/Shell Group, the world’s most profitable oil company, which is widely viewed as a bench mark for strategic planning.”  FULL ARTICLE read more

Daniel Fisher: Writer and communications consultant and former senior editor with Forbes magazine; 21 March 2018

Five of the world’s largest oil and gas producers have filed a motion to dismiss a climate change lawsuit against them by the cities of Oakland and San Francisco even as they prepare to deliver an unusual “tutorial” on climate science to the federal judge overseeing the case. In a 45-page filing on Tuesday, Chevron, BP, ConocoPhillips, ExxonMobil and Royal Dutch Shell urged U.S. District Judge William Alsup to dismiss the lawsuit seeking billions of dollars to pay for costs associated with global warming. The oil companies argue the U.S. Supreme Court and the U.S. Court of Appeals for the Ninth Circuit have repeatedly rejected similar lawsuits against oil companies, the auto industry and electric utilities because Congress has given authority to regulate CO2 emissions exclusively to the Environmental Protection Agency. FULL ARTICLE read more

Gaurav Sharma , CONTRIBUTOR: 18 JAN 2018

Oil giant Royal Dutch Shell’s trading arm Shell Trading International made a significant move into blockchain development on Thursday (18 January) by bagging a minority stake in London, U.K.-based start-up Applied Blockchain. In the simplest of terms, a blockchain is akin to a digitally distributed ledger that can be replicated and spread across many nodes in a peer-to-peer network, thereby minimising the need for oversight and governance of a single ledger. It is being actively pursued by several energy traders among others. Along with Shell Trading International, Caliberate Partners would also be taking a minority stake in the start-up founded in 2015 in London’s Level39 Fintech Accelerator. FULL ARTICLE read more

…these are also the same waters unsuccessfully explored by Royal Dutch Shell in 2015, after which the company halted Arctic operations for the foreseeable future.

Sam Ori , Contributor: JAN 8, 2018 @ 09:58 AM

Interior Secretary Ryan Zinke released the Trump Administration’s long-awaited offshore drilling proposal last week. Once enacted, the plan will replace the existing leasing schedule, which was designed by the previous administration and had been set to run through 2022. New administrations are free to scrap the hold-over plans of prior administrations, and anyone who followed the 2016 presidential campaign knew that President Trump had a dramatically different view of offshore energy development than his predecessor. FULL ARTICLE read more