By John Donovan
PRELUDE DESIGNED BY SHELL LAWYERS? MORE IMPORTANT ROLE THAN ENGINEERS?
What will Bill Campbell make of the boasts from Shell’s chief lawyer Donny Ching, about the pivotal role of Shell in-house lawyers in the world’s first floating liquefied natural gas (LNG) facility, Prelude FLNG?
Extracts from an article about Donny Ching published by The Law Society Gazette on 5 December 2014:
Ching also believes that external law firms would have been no substitute for in-house lawyers in the work they did to build the world’s first floating liquefied natural gas (LNG) facility, Prelude FLNG.
‘The real challenge was not that we were going to build one of these, it was to say “think about what business opportunity does this create?”.
‘Lawyers had to really draw extensively on what we know as lawyers and what the company knew in relation to all these aspects, as well as LNG sales, LNG plant and construction, shipping, construction, safety regulation, procurement, intellectual property and environmental law.
‘Trying to put all this together and not just build a contract to build one – but to build many and have a business model for it.’
He added: ‘This is something that had never existed before. It was not an easy task… I believe that no external law firm could have pulled this together for us.’
There was a similar collaboration between a bunch of Shell in-house lawyers in the merger of Shell Transport & Trading Co Ltd and Royal Dutch Petroleum into Royal Dutch Shell Plc in 2005.
The senior Shell lawyer in charge (now retired) boasted that the experience was like conducting an orchestra. Only problem was that someone neglected to register the top level internet domain name for the new company, Royal Dutch Shell Plc (royaldutchshellplc.com).
That cock-up led to nearly 10 years of humiliation, thus far, for Shell.
A screw-up of a similar magnitude among Shell internal lawyers collaborating on the Prelude FLNG project, could end in calamity for the company, the pubic, employees and the environment, not just an amusing long term embarrassment.
How can Shell have faith in the competence of its army of in-house lawyers that has come unstuck in every attempt to close down our Shell focussed internet activity that Shell first complained about in March 1995. The record does not inspire confidence.