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Shell slashes valuation of oil and gas assets amid coronavirus crisis

Shell slashes valuation of oil and gas assets amid coronavirus crisis

By Mark Williamson: 1st JULY 2020

The company said yesterday it expected to cut the valuation of its integrated gas business by $8 – $9 billion, “primarily in Australia”. It said this would include a partial impairment of the giant Prelude floating liquefied natural gas facility.

ROYAL Dutch Shell has said it plans to slash the valuation of its oil and gas assets by up to $22 billion (£17.9bn) to reflect the expected impact of the Covid-19 coronavirus pandemic on demand and the wider economy. read more

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.

Successive Shell CEO’s cannot say that they were not warned time and again about the Prelude experiment

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

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.

Shell’s $12 Billion LNG Experiment Becomes A Big Headache

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.

Tim Treadgold Asia: June 23, 2020

The world’s biggest ship is on the way to becoming one of the oil industry’s biggest bloopers.

Prelude, a 600,000-ton monster which is five-times the size of the largest U.S. aircraft carrier, is designed to produce liquefied natural gas (LNG), and other petroleum liquids.

Installed atop a remote gasfield 300 miles off the north-west Australian coast, the 535-yard long Prelude is a bold experiment by the oil major, Royal Dutch Shell. read more

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.

Shell’s Prelude floating LNG plant out of action for several months?

Australian LNG exports defy supply glut

Angela Macdonald-Smith
Angela Macdonald-Smith Senior Resources writer Updated Jun 5, 2020 – 12.20pm, first published at 10.55am

Australia’s exports of liquefied natural gas are holding at near-record levels, defying a global supply glut that has swamped the market, causing prices to crash and driving the cancellation of cargoes from the US.

LNG production from the country’s plants on the north-west and eastern coasts rose in the March quarter by 11 per cent from the year-earlier quarter to 19.9 million tonnes, and was only marginally below the record levels of the second half of 2019, according to the latest analysis from consultancy EnergyQuest, released on Friday. read more

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.

Shell Prelude FLNG fiasco, late, expensive, dirty, unreliable and dangerous

Expert comments received in response to the BoilingCold article by Peter MilneNo winners from Shell’s $US17B Prelude floating LNG”

Comment from retired Shell International Global Safety Consultant, Bill Campbell:

It’s all rather depressing, most worrying aspect as implied in the article is the potential gas supply, or lack of it, from the homogeneous and shared reservoir with another operator bleeding off volumes.

The boilingcold.com.au journalist Peter Milne has given the most detailed analysis yet of the Prelude story, elements of both tragedy and farce.

COMMENT FROM “AN OLD SHELL E&P ENGINEERING SEA DOG”

As before I feel very sorry for the Aussies who are under extreme pressure to get this unit up and running.  I do not quite understand the journalist comment of “gas is running out”.  It is a shared reservoir therefore there will be an agreement for the total volumes in place and a regular review taking place to determine the remaining producible volumes and the agreed volume share for each operator.

The links below are to a series of articles, many triggered by a well-placed whistleblower directly involved in the pioneering Royal Dutch Shell Prelude project. Includes articles by Mr Bill Campbell above, the retired distinguished HSE Group Auditor of Shell International and another retired Shell guru with a track record of spotting potential pitfalls in major Shell projects.

The fears voiced by Bill Campbell about a loss of containment (see article link 3) have proven well-founded.

Ask the Australian National Offshore Petroleum and Environmental Management Authority.

ARTICLE: Voser wisely abandons an unstable ship: 28 December 2013

ARTICLE: Royal Dutch Shell Prelude to disaster?: 10 Jan 2014

ARTICLE: Shell Prelude FLNG: loss of containment of hydrocarbons almost inevitable: 21 Feb 2014

ARTICLE: What should frighten stiff Royal Dutch Shell shareholders: 15 March 2014

ARTICLE: Tales of the Unexpected and Royal Dutch Shell Prelude FLNG: 28 March 2014

ARTICLE: Prelude FLNG: A case of all your eggs in the one basket: 10 July 2014

ARTICLE: Prelude FLNG risks are on par with modern offshore oil and gas facilities say Shell – but are they?: 23 Sept 2014 read more

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.

No winners from Shell’s $US17B Prelude floating LNG

Peter Milne  Peter Milne

Shell’s Prelude floating LNG facility off the WA coast was to be the first of many that would open up stranded gas reserves around the world thanks to the technical and project management prowess of Anglo-Dutch oil and gas giant Shell.It has not turned out that way.When the 488m-long giant arrived in Australia almost three years ago, Shell expected to receive cashflow from the Prelude in 2018.

While the Prelude did export LNG at about half its capacity for the second half of 2019, it is now idle.

Moored far off the Kimberley coast it is plagued with technical problems, dwindling gas reserves and safety processes condemned by the regulator despite Shell and its partners spending about $US19.3 billion ($A30.0 billion) to the end of 2019.

Neither Shell and its partners nor Australia have gained anything near what they expected from the giant experiment. read more

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.

OilPrice.com: The LNG Market Is “Imploding”

Nick Cunningham Oilprice.comApril 28, 2020

While everyone is understandably watching the meltdown in the crude oil market, the global market for natural gas is also cratering.

At least 20 cargoes of U.S. liquefied natural gas (LNG) have been cancelled by buyers in Asia and Europe, according to Reuters. The global pandemic and the unfolding economic crisis have slashed demand for gas worldwide. Cheniere Energy, one of the main exporters of U.S. LNG, has seen an estimated 10 cargoes cancelled by buyers halfway around the world, Reuters said. read more

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.

Significant risk to the health and safety of persons at the Shell Prelude FLNG Facility

A TALE OF INSPECTORS AND INVESTIGATIONS INVOLVING DANGEROUS OCCURRENCES AT THE PRELUDE FLNG FACILITY (AND THE INTERVENTION OF COVID-19).

In a letter dated 16 March 2020 to the Australian National Offshore Petroleum and Environmental Management Authority (NOPSEMA), Shell Australia Pty Ltd sought an extension of time for compliance with NOPSEMA General Direction ID 780 in relation to dangerous occurrences at the Prelude FLNG Facility

NOPSEMA agreed in its reply letter dated 20 March to “revise the due date for Direction 2 to 31 May 2020 to provide additional time for Shell Australia Pty Ltd (Shell) to fully comply with the directions, due to extenuating circumstances associated with measures put in place to mitigate the spread of the COVID-19 virus. read more

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.

WSJ: Shell Sees Coronavirus Eroding Chinese Natural Gas Demand

Energy giant said it is redirecting shipments and looking for new buyers for LNG that was previously allotted to China read more

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.

ENB: Prelude to remain shut three more weeks: regulator

Prelude to remain shut three more weeks: regulator

18 February 2020

THE Prelude, Shell’s flagship floating LNG vessel moored offshore Western Australia, will remain shut down “for at least three weeks from Wednesday February 12,” the offshore regulator has told Energy News, based on information from Shell.

The National Offshore Petroleum Safety and Environmental Management Authority issued Shell a safety notice January 22 but did not shut the vessel down. SOURCE
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.

Reuters: UPDATE 1-Shell temporarily suspends LNG liftings from Prelude off Australia

* No timeframe for resuming output at Shell’s Prelude FLNG

* Outage keeps Prelude LNG off amid market glut (Adds background on Prelude)

MELBOURNE, Feb 18 (Reuters) – Royal Dutch Shell has temporarily suspended cargo liftings from its Prelude floating liquefied natural gas (LNG) facility off northwest Australia while it works to restore production following an electrical trip on Feb. 2.

“Work continues to restore full operations on Prelude, our floating LNG facility in Australia,” the energy giant said in an emailed statement on Tuesday. read more

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.

Bloomberg: BP’s bold goal: Eliminate or offset its carbon emissions

BLOOMBERG: FEB. 12, 2020 2:50 PM

BP’s new boss set out the boldest climate goal of any major oil company, pledging Wednesday to eliminate almost all of the carbon emissions from BP operations and the fuel it sells to customers.

Bernard Looney, who has been the company’s chief executive for just a week, set an ambitious agenda for what’s becoming an existential challenge for the oil industry. While peers such as Royal Dutch Shell, Total and Equinor have responded to investor pressure by adopting targets for emissions curbs, none has promised to zero out all emissions from the fossil fuels they pump from the ground. read more

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.

Shell and Qatargas sign LNG deal for Kuwait

Dutch Telegraph

By ANP PRODUCTIONS: 14:39 in FINANCIAL

LONDON – Shell has signed a deal with Qatargas for the delivery of liquefied natural gas (LNG) to Kuwait. The parties announced this without releasing financial details.

This is a long-term agreement whereby from 2020 onwards 1 million tonnes of LNG will be delivered to Kuwait. The LNG deliveries come from Qatar Liquefied Gas, a joint venture between Qatar Petroleum and Shell. Qatar is the world’s largest exporter of LNG.

SOURCE

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.

LATEST EXPERT THOUGHTS ON PRELUDE EMERGENCY SHUT DOWN

Use your browser to enlarge image

LATEST BILL CAMPBELL THOUGHTS ON PRELUDE EMERGENCY SHUT DOWN

John

It looks like the content of your web pages have contributed to a better understanding of the troubles of this project, at one time heralded as the shining city on the hill.

It seems reading between the lines that the power problems, the terrible PR, the fall in the LNG price etc, but particularly that they could not continue working on the plant intrusively with inadequate isolation, are all factors. 

Perhaps this is a chance to remedy what appears to be a significant amount of defects including defective process isolation and venting in the design, inaccurate drawings P&IDs etc and incorrect identification of equipment – as an example the RV being replaced was wrongly tagged. read more

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.

Prelude shutdown

Prelude shutdown

OPERATION of the world’s largest offshore facility, Shell’s embattled Prelude floating LNG vessel, has descended into chaos with back up power generation failing, cardboard potties issued to replace regular toilet facilities and a fleet of helicopters called in to reduce crew numbers.

05 February 2020

Only last week Shell chief executive Ben van Buerden told analysts the Prelude was evidence of how new assets would improve the gas giant’s cash flow in 2020. read more

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.

Prelude alarm bells should be ringing at Shell HQ

PRELUDE COMMENTS FROM “AN OLD SHELL E&P ENGINEERING SEA DOG”

With reference to the published info from Bill regarding the very serious operational shortcomings on the Prelude NGL vessel.

It may be worthwhile publishing the entire notice as if it read by senior people in the Hague central offices there may be a sounding of very loud alarm bells if not there should be as Prelude represents an enormous investment and a leap into the future.  The root cause of these issues requires to be identified and a root and branch analysis of how and why this state of affairs has been allowed to evolve, I believe it is a cumulative pressure from many sources over many months and not just the recent inspections, its much deeper than that. We can only speculate and read with a degree of horror the findings of the Australian Regulator. read more

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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