April, 2007:

By Christian Schmollinger

April 27 (Bloomberg) — Crude oil rose in New York after a refinery fire and the threat of a production strike in Europe pushed gasoline futures higher for an eighth day.

Gasoline reached an eight-month high of $2.32 a gallon yesterday after a fire at Marathon Oil Corp.’s Garryville, Louisiana, unit and Belgian workers voted to strike at four refineries in Antwerp next month. U.S. gasoline stockpiles fell for an 11th week after the processing utilization rate dropped to 87.8 percent, the Energy Department said April 25. read more

Apr 27, 2007

Shell Companies of Thailand has budgeted 500 million baht to renovate petrol stations and improve efficiency this year, according to chairman Tiraphot Vajrabhaya.

Shell has 570 petrol stations, of which 10 to 20 are targeted for closure.

“Thailand is one of the most challenging markets. … Over 10,000 pumps nationwide are much higher than demand,” he said, adding that Shell had seen narrow profit margins in Thailand for two consecutive years.

Shell targets sales this year at 2.8 billion litres, an increase of 6-7% from last. However, the company aims to increase its market share to 18% from the current 16% by 2008. Its operational improvement programme could increase sales volumes by 20%, he said. read more

Aine Ryan
Apr 27, 2007

Ireland’s “close political-corporate climate” will put “intense pressure” on the Environmental Protection Agency to issue an integrated pollution prevention licence, according to BrId McGarry, a landowner in ongoing High Court proceedings against Shell E&P Ireland.

“It is clear the Environmental Protection Agency, like An Bord Pleanala, is also subject to intense pressure to assist developments of this nature,” said Ms McGarry in her submission on the eighth day of the agency’s oral hearing into the issuing of a licence. She was referring to the planning board’s overturning of its inspector’s advice, which stated the site was unsuitable. read more

Lorna Siggins, Marine Correspondent
Published: Apr 27, 2007

Garda security for the Corrib gas project in north Mayo has cost 5.4 million for just over six months, according to Minister for Justice Michael McDowell.

The bill from October 3rd, 2006 to April 17th this year includes Garda salaries, and breaks down as more than 800,000 a month.

The figures were released by the Minister yesterday in a written Dail reply to Mayo TD Jerry Cowley (Ind).

In his reply, Mr McDowell said that it was not Garda policy and would “not be in the public interest” to disclose detailed information on numbers of gardaI deployed in the Erris area. read more

Published: Apr 27, 2007

A PROGRESSIVE Democrat general election candidate has called on Shell to pay compensation to the Rossport Five.

Ballina-based Cllr Tommy Cooke broke his party’s silence on the controversy by saying Shell should also make a full public apology to the men, who spent 94 days in jail for their opposition to the routing of the Corrib Gas pipeline.

“In my opinion, it was a disgrace that they should end up in prison for what we’d all have done. They defended their rights and at this stage when everyone agrees, even Shell, that what was done wasn’t right, there should be an apology and compensation.” read more

Steve Hawkes

The production sharing agreement for Sakhalin II in 1994 was the first one signed by the Russian Government.

The agreement that will see Shell pay the Kremlin an annual dividend to maintain its already diluted stake in the field shows how far the balance of power has shifted since.

Faced with pressure to find new oil and gas reserves from a smaller number of prospects, Western majors are having to go down on their knees in Russia and pray for the best.

While the “priority dividend” may be embarrassing for a group of Shell’s heritage, it will point to BP’s role in the recent Yukos auction to show that no other company is being treated differently. read more

State regulators are accepting public comment through May 16 on Shell Frontier Oil and Gas Inc.’s plan to get oil shale locked in rocks on Colorado’s Western Slope.

Shell is researching how to get vast oil resources out of oil shale rocks in western Colorado by heating the rocks and melting the oil.
 
The company received federal approval for leasing acreage to conduct the research in 2006 and is now working on getting the necessary state permits for operations related to the research. read more

(An employee of Sakhalin Energy stands at the Sakhalin-2 project’s liquefaction gas plant in Prigorodnoye)

By Russell Hotten
Last Updated: 1:44am BST 27/04/2007

More details of the terms on which Royal Dutch Shell ceded majority control of its flagship Sakhalin-2 gas project have emerged with news that the company will pay the Russian government an annual special dividend.

The agreement to pay the dividend, which will run into hundreds of millions of pounds, was one of a number of concessions agreed by Shell and two Japanese partners in return for their continuing involvement in the lucrative project. read more

April 27, 2007
Steve Hawkes

Shell is being forced to pay the Russian Government an annual dividend of about $100 million (£50 million) to keep its stake in the lucrative Sakhalin II offshore project.

The Anglo-Dutch group and its partners admitted yesterday they had agreed to “minor adjustments to the fiscal terms” of the project. The change was pushed through last week when Shell formally handed over a majority stake in Sakhalin II to Gazprom, the Kremlin-controlled gas group.

Analysts said that although the sum would not be material to Shell, it was yet another sign of the Kremlin’s power over Western energy firms desperate to find and exploit new oil and gas reserves. read more

Friday, April 27, 2007. Issue 3646. Page 5.
Bloomberg

LONDON — Shell and its Japanese partners will make annual payments to the government as part of an agreement that brought Gazprom into their Sakhalin-2 oil and natural gas project, a Shell spokesman said Thursday.

“There have been minor adjustments to fiscal terms while keeping the [production sharing agreement] intact,” Shell spokesman Adam Newton said in London.

The changes “give the Russian government more access to revenues when oil and gas prices are higher and take the Russian government’s view on cost-recovery allowances.” read more

AGENCIES[ FRIDAY, APRIL 27, 2007 12:00:00 AM] 

NEW DELHI: Oil and Natural Gas Corporation (ONGC) is firming up a proposal to buy up to 33% in an Egyptian deepwater gas block from operator Royal Dutch Shell, sources said on Thursday.

“Talks are at an advanced stage. Very soon a high-level government panel will take a decision whether to allow ONGC to go ahead with the offer or not,” a source involved in the planned deal said. The value of the possible transaction was not known.

The deal for a stake in Shell’s North East Mediterranean Deepwater (NEMED) block is not being opened to bidding, and no swap arrangement between the two firms is involved, said sources. Shell has announced the block, in which it holds 84%, has probable reserves of 15 trillion cubic feet, according to a US Department of Energy website. The block holds initial in-place reserves of more than 1 tcf with “sizeable upside”, added sources. read more

By Kariuki Ndung’u

Shell Petroleum Company, a subsidiary of Royal Dutch Shell, has officially taken over the 50 per cent stake of the British Petroleum (BP) shareholding at the Shell/BP venture in the country.

The move follows plans by BP to exit from the local market citing reducing profits margins in the local oil industry due to heavy competitions and strict government policies on the oil industry.

The takeover means Shell will acquire the 50 per cent stake currently being held by BP Africa Limited in Kenya Shell Limited, BP Kenya Limited and Shell/BP (Malindi) Kenya Limited (the JV companies) making them wholly owned subsidiary of the Shell Petroleum company Limited. read more

London, 26 April: ABN Amro has reportedly provided $1 billion to Gazprom to finance its purchase of a controlling share in the controversial oil and gas project Sakhalin II.

Sakhalin II is located on the island of Sakhalin, off the pacific coast of Russia. Environmental campaigners have long opposed its development, because it is sited in the only known breeding ground of the rare Western Grey whale. Onshore construction is also alleged to impact on the population of wild salmon that breed in the island’s network of rivers. read more

By Upstream staff

Norwegian giant Statoil has taken on some of Anglo-Dutch supermajor Shell’s stakes in a number of Norwegian Sea exploration licences.

Statoil struck a deal with Shell which will see it take on Shell’s stake in Production Licence 281, dubbed Midnattssol, in the Norwegian Sea from 1 January this year.

Statoil now has a 50% stake in Midnattssol. One exploration well, Elida, has already been drilled in the licence. Elida-2 is set to spud in May or June.

The other Midnattssol licensees are E.ON Ruhrgas (20%), Petoro (20%) and ConocoPhillips (10%). read more

Thu Apr 26, 2007 12:35 PM EDT
 
CALGARY, Alberta (Reuters) – Royal Dutch Shell Plc (RDSa.L: Quote) wrapped up its C$8.7 billion ($7.8 billion) acquisition of the minority stake in Shell Canada Ltd. (SHC.TO: Quote) on Thursday and delisted the shares from the Toronto Stock Exchange.

Shell said it now owns all of Shell Canada after a compulsory acquisition, allowed under Canadian law, of the remaining shares that did not tender to the C$45 a share offer.

The Anglo-Dutch oil major now has exclusive control of Shell Canada’s operations, including three refineries, a nationwide chain of gas stations, conventional oil and gas production, and the company’s controlling stake in the Athabasca oil sands project. read more

Royal Dutch Shell has agreed to pay an annual dividend to the Russian government to keep its stake in the lucrative Sakhalin II offshore project, it emerged today. The payment could be up to $275 million (£138 million).

April 26, 2007
Steve Hawkes

Anglo-Dutch giant has agreed to pay Kremlin an annual dividend to keep its stake in lucrative offshore project.

Shell and its partners in the field agreed the deal last week when the Kremlin-controlled gas giant Gazprom formally took a majority shareholding in the project. read more

Andrew Willis, today at 7:01 AM EDT

Speculation on oil patch monster deal has taken a new twist, with talk of a Canadian-buys-Canadian deal pushing aside foreign takeover speculation.

Domestic energy companies have long been seen as targets for cash-rich global players that want to lock in reserves. The Royal Dutch Shell purchase of its Canadian subsidiary is expected to mark the first step in a larger consolidation.

In the past week, talk has shifted from ‘who will BP and Chevron buy?’ to ‘Is there a Canadian team with the moxie to create a national champion?’  (Chevron, by the way, filed the paperwork needed for a massive financing a few months back.) read more

Judge won’t release details in Shell case

Thursday, April 26, 2007

From staff reports

A federal judge should not be allowed to secretly divide up nearly $7 million in legal fees among 79 attorneys who filed suit against Shell Oil Co. in 2004, The Times-Picayune is arguing in an appeal of an unusual confidential court decision.

U.S. District Judge Ivan Lemelle secretly allocated cash to some law firms described by one lawyer as claiming hours that were “grossly excessive.” Two firms received a “substantial award” even though they “didn’t do anything for the common benefit,” according to a transcript of a January hearing before the judge. read more

EXTRACT: A consortium led by Royal-Dutch-Shell ceded half of the $21.4bn (£10.7bn, e15.7bn) Sakhalin-2 oil and gas project to Gazprom earlier this month, following months of bullying by the state on spurious environmental grounds.

25/04/2007

A free, democratic and prosperous Russia closely associated with the West – that was the vision the country’s former president, Boris Yeltsin, who died this week, so splendidly incarnated when he defiantly stood on that tank in Moscow in August 1991. But Yeltsin’s dream of a liberal Russia died long before him. While he deserves eternal gratitude for ending the Soviet Union with minimal bloodshed and for all his unstinting work in the earlier defeat of communism, Yeltsin’s great tragedy was that he also laid the seeds for the return of authoritarianism. read more

Thu Apr 26, 2007 8:12 AM BST

LONDON, April 26 (Reuters) – Royal Dutch Shell (RDSa.L: Quote, Profile , Research) and its partners have agreed to pay an annual dividend to the Russian government as part of a deal to salvage its Sakhalin-2 project, the Wall Street Journal said on Thursday.

The dividend will be paid from 2010 onward and linked to the price of oil, the newspaper quoted an unidentified person familiar with the situation as saying.

“It’s going to be something under a billion dollars every year,” the person was quoted as saying. read more

EXTRACT: Today the financial markets are full of rumours of new mergers, with BP the likely prey since the surprise resignation, early this year, of its president. A merger between Shell and BP, the second- and third-largest, is possible.

by Jean Pierre Sereni

28-03-07 PetroChina, China’s leading oil company, which is quoted in Hong Kong and on Wall Street, may be no more than a subsidiary of the major state-owned China National Petroleum Corporation (CNPC), but last December it overtook Shell to become the world’s sixth-largest company by market value. read more

EXTRACTS: For angry residents of the delta, Shell has become synonymous with poverty and pollution. Shell Nigeria has brought social, spiritual and ecological impoverishment to the delta.

Robert Lacville

Tensions were running high at election time in the Niger delta. Some western oil companies sent families home and shut down all travel for three weeks. “Don’t get kidnapped,” a friend emailed. More than 200 kidnappings have been recorded since October last year. “Beware of hijackers,” a Nigerian woman told me in London. read more

Lorna Siggins, Marine Correspondent,
Published: Apr 26, 2007

Norwegian energy company Statoil has said that it cannot support political calls for an independent commission to evaluate the entire Corrib gas project in north Mayo.

The company was commenting after a meeting between four of its senior executives and a seven-strong delegation of Labour, Green Party, Socialist Workers Party and Independent TDs in Dublin yesterday over the controversial project.

Statoil is partner with Shell E&P Ireland and Marathon in developing the Corrib field some 65km off the Mayo coastline. An integrated pollution licence for the onshore refinery is the subject of an Environmental Protection Agency (EPA) oral hearing in Belmullet, Co Mayo. read more

Aine Ryan,
Published: Apr 26, 2007

The “demonisation and vilification” of the people of Erris, along with the continued large presence of gardaI, militated against the Environmental Protection Agency’s oral hearing forming an objective decision, the hearing was told yesterday.

On the seventh day of the hearing into the issuing of an integrated pollution prevention licence for the Corrib gas refinery, Sean Harrington – who is objecting to the licence – suggested to the chairman, Frank Clinton, that since he was “only human”, he was bound to be influenced by such factors. read more

By Fiona Harvey and Stephen Fidler in London
Published: April 25 2007 22:07 | Last updated: April 25 2007 22:07

Companies and individuals rushing to go green have been spending millions on “carbon credit” projects that yield few if any environmental benefits.

A Financial Times investigation has uncovered widespread failings in the new markets for greenhouse gases, suggesting some organisations are paying for emissions reductions that do not take place.

Others are meanwhile making big profits from carbon trading for very small expenditure and in some cases for clean-ups that they would have made anyway. read more

25th April 2007
By Clare Watson

Oil giant Royal Dutch Shell is reportedly installing food corners in 58 of its 102-strong network of Bulgarian petrol stations in partnership with Bulgarian ice cream company Jimmy’s, according to local publication Dnevnik.

The five-year agreement will see Jimmy’s install food stands to provide ice cream, sandwiches, snacks and beverages to Shell’s fuel retail customers, Dnevnik said.

The publication cited Teodora Koleva, the oil giant’s commercial director, as saying that the move comes as part of Shell’s aim to focus on its fuel retailing activities by passing on the management of the non-core operations across its fuel network to outside companies. read more

State regulators are accepting public comment through May 16 on Shell Frontier Oil and Gas Inc.’s plan to get oil shale locked in rocks on Colorado’s Western Slope.

Shell is researching how to get vast oil resources out of oil shale rocks in western Colorado by heating the rocks and melting the oil.
 
The company received federal approval for leasing acreage to conduct the research in 2006 and is now working on getting the necessary state permits for operations related to the research. read more

DEAL OR EXILE: Royal Dutch Shell PLC and its partners reached an agreement to pay a substantial annual dividend to the Russian government as part of a deal to salvage the $20 billion Sakhalin-2 project. The move demonstrates just how far major Western oil companies apparently must go to remain in the good graces of oil-producing countries such as Russia, as governments tighten control over natural resources.

The previously undisclosed agreement was part of a settlement that ended months of pressure from Russian regulators who had threatened to shut down Sakhalin-2, a huge oil and natural-gas project in Russia’s remote Far East. The pact essentially changes the terms of the Sakhalin-2 agreement, while avoiding the legal complexities that would be involved in formally revising the contract. In addition to ceding a controlling stake in their flagship Sakhalin-2 project to the Russian state gas company last week, they will pay to the Russian government from 2010 onward a so-called priority dividend that will be linked to the price of oil. read more

By GUY CHAZAN
April 26, 2007; Page A3

MOSCOW — In addition to ceding a controlling stake in their flagship Sakhalin-2 project to the Russian state gas company last week, Royal Dutch Shell PLC and its partners also agreed to pay a substantial annual dividend to the Russian government as part of a deal to salvage the $20 billion venture, according to people familiar with the situation.

The previously undisclosed agreement was part of a settlement that ended months of pressure from Russian regulators who had threatened to shut down Sakhalin-2, a huge oil and natural-gas project in Russia’s remote Far East. The pact essentially changes the terms of the Sakhalin-2 agreement, while avoiding the legal complexities that would be involved in formally revising the contract. read more

April 25, 2007, 11:08 am