Shell's decision to double its capex in recent years was largely forced on it to counter falling production and reserves which were the result of earlier underinvestment.
January 30th, 2009:
ANALYSIS-Oil majors to keep investing to avoid past mistakes
Shell employee safety: Shell EP Boss Malcolm Brinded says Shell has had a “dreadful start” to 2009
Shell gets tough on costs as oil prices bite
Tom Bergin
Royal Dutch Shell has intensified its cost-cutting efforts in response to the collapse in oil prices and also plans to step up efforts to improve what it said was a “mixed” safety record.
Shell’s head of Exploration and Production Malcolm Brinded told employees in an email seen by Reuters that staff had to make “tough choices.”
“We simply need much higher sustainable savings this year and I ask for real actions from all of you …. Shed contractor staff, challenge requirements, eliminate consultancy work, reduce travel massively, cut overheads everywhere,” he said.
Shell gets tough on costs as oil prices bite
Fri Jan 30, 2009 7:36pm GMT
By Tom Bergin
LONDON (Reuters) – Royal Dutch Shell (RDSa.L) has intensified its cost-cutting efforts in response to the collapse in oil prices and also plans to step up efforts to improve what it said was a “mixed” safety record.
Shell’s head of Exploration and Production Malcolm Brinded told employees in an email seen by Reuters that staff had to make “tough choices.”
“We simply need much higher sustainable savings this year and I ask for real actions from all of you …. Shed contractor staff, challenge requirements, eliminate consultancy work, reduce travel massively, cut overheads everywhere,” he said.
LEAKED SHELL INTERNAL EMAILS FROM JEROEN VAN DER VEER AND MALCOLM BRINDED DATED 29 JANUARY 2009
The following leaked Shell internal emails contain candid admissions from Shell senior management not provided to shareholders in the Q4 financial results published on the same day. I have highlighted in bold examples of the candid admissions meant for Shell employees only. I supplied the leaked emails to Reuters who published an article after confirming the authenticity of both emails with Shell.
Shell’s Jeroen van der Veer on climate change
Shell tries to stay on an even keel
Credit Suisse analyst James Neale, in a note to investors, voiced concern that the companys return to growth will be short-lived in view of efforts by the company to slow final investment decisions on future growth projects due to current economic weakness, and in order to await lower future service costs.
Shell to Raise Capital Spending, Dividend Despite Quarterly Loss
Although Shell said it would spend more this year than last, it has also postponed some decisions on major investments in the hope that costs may come down. These include Carmon Creek in Canada; Mars B, an oil project in the Gulf of Mexico; and the Pierce field in the U.K. Last year, it also announced it was putting off a decision to expand its Athabasca oil-sands development in northern Canada.
Shell’s Van der Veer unable to predict upturn
At last year's World Economic Forum, he was among those who saw no reason to panic about economic downturn. In the event, the onset of recession eroded oil demand, helping to pull the oil market down from a record of nearly $150 a barrel last July to around $40 now.
Shell keeps spending despite profits fall
Shell also revealed that it had a total $8.3bn deficit in its worldwide pension funds because of the fall in share prices last year. The figure is only about 5 per cent of its market capitalisation.
Shell profits slump on shifting crude price
Profits at Royal Dutch Shell slumped in the fourth quarter as the oil group paid the price for its high-cost business model in Canada and crumbling refining and chemical margins.
Energy workers get new offer
Shell Oil Co., which is representing the energy industry, has been meeting with negotiators from the United Steelworkers Union in Austin.
Shell Declines to Comment on Reports of Possible Bid for Nexus
Jan. 29 (Bloomberg) -- Royal Dutch Shell Plc Chief Financial Officer Peter Voser declined to comment on reports of a possible bid for Nexus Energy Ltd., the developer of the proposed Crux natural gas liquids venture off northern Australia.