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January, 2006:

Irish Independent: Shell likely to downgrade size of Corrib gasfield reserves by $2bn

Saturday January 28th 2006
Pat Boyle
SHELL is expected to downgrade the estimated size of the Corrib gasfield by about $2bn worth of gas to take account of conservative new accounting policies and problems with the gas reservoir.
Oil industry sources said that a quarter of the Corrib reservoir is extremely problematic, and that there is no guarantee the gas contained in this section can be recovered, forcing Shell into a downgrade of recoverable reserves in order to stay in line with conservative new accounting practices.
A spokeswoman for Shell declined to comment, saying the company did not comment on a “field by field basis”.
Early estimates for the Corrib field were that it had one trillion cubic feet of gas.
However, as appraisal work on the find progressed, this was downgraded to about 850 billion cubic feet of recoverable gas reserves, and now that figure could fall towards 600bn cubic feet.
Now Shell is set to downgrade this further, possibly by up to 25pc to take account of the problems with the reservoir.
Downgrade
The downgrade would translate to some €2bn worth of gas at today's prices.
Such a cut will make severe inroads into the profitability of the find, but industry players believe Shell will persevere, even though by the end of 2004 almost half of the estimated $900m development budget had already been spent. Since then development costs have soared by some 40pc, leaving the economics of the project tightly balanced.
The cut in reserves may also call into question estimates which suggested the field would supply the bulk, 60pc, of national demand for 15 years from about 2007.
Shell acquired its 45pc stake in Corrib through its acquisition of Enterprise Oil for about $5.7bn in 2002.
The issue of reserves at Shell came under the spotlight when the company admitted that, under the US Securities and Exchange Commission's 'proven' definition of reserves, it had exaggerated the total by some 20pc.
After a series of corrections the reserves were eventually chopped to 4.47bn from 5.9bn barrels of oil and gas.
According to consultants Wood MacKenzie, Shell now has among the most conservative accounting procedures in the industry, and it is expected that when its next round of reserve estimates are published, they will take account of a cut of about 25pc in the size of Corrib reserves.
One of its partners in the Corrib field, the US firm Marathon, has already reduced the share of Corrib it regards as proven by 145m barrels of oil equivalent (MBOE) or 84bn cubic feet of gas.
Shell has already undertaken a hefty writedown in the value of the assets it acquired when it bought Enterprise Oil – the most recent a $330m downgrade in 2004 and even with its many problems, Corrib is one of the few Enterprise assets it can point to in order to justify Enterprise's $5.7m price tag. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Personal Finance: Shell improperly used surplus pension money

Personal Finance: Shell ‘improperly used’ surplus pension money 

January 28, 2006
By Bruce Cameron and Charlene Clayton

A ruling against oil company Shell may force many trustees to reassess whether their funds are in surplus or whether surpluses have been understated.

In the first ruling of its kind, a tribunal appointed by the Registrar of Pension Funds has found that the Southern African arm of petroleum giant Shell should repay millions of rands to its staff defined benefit pension fund. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Philippine Daily Inquirer: Shell leads consortium in oil search off Palawan

Ronnel W. Domingo
Jan 28, 2006
THE OPERATOR OF THE MULTIBILLION-dollar Malampaya natural gas project has teamed up with the government and two private firms to look for oil and gas in an area near its current production field.
In a joint satement, Shell Philippines Exploration BV said it signed with the Department of Energy, Kuwait Foreign Petroleum Exploration Co. (Philippines), and South China Resources Inc. a deal on Service Contract No. 60, which covers a relatively unexplored area of 1.01 million hectares offshore north of Palawan.
Interest in SC 60 is distributed as follows: Spex, 55 percent; Kufpec Philippines, 30 percent, and SCR, 15 percent.
Kufpec is a subsidiary of state-owned Kuwait Petroleum Corp. while SCR is a local firm listed on the Philippine Stock Exchange and involved mainly in oil exploration.
An SC is a license issued by the energy department allowing explorers and developers to scour oil and gas prospects within the country and continue to the production stage in case petroleum reserves were found.
The partners said the SC 60 project, which used to be covered by Geophysical Survey and Exploration Contract No. 99, involves one of the promising sites for petroleum exploration identified by the Philippine Petroleum Resource Assessment Project Study.
The study, conducted by the Norwegian Agency for Development Cooperation (Norad) and the DOE, provided updated data on the petroleum basins in the country and identified the level of prospectivity of each area.
Under SC 60, the consortium committed to spend at least $24 million or about P1.27 billion during the seven-year exploration period. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

THE WALL STREET JOURNAL:

Davos News Tracker
January 27, 2006 9:32 p.m.
Updated regularly with news from the World Economic Forum in Davos, Switzerland. All times EST.
Friday, Jan. 27
9:30 p.m.: WSJ's Alan Murray reports. When the Oscars roll around in March, the parade of Versace, Dior and Prada gowns will help set fashions for the year ahead. But for the boardroom crowd, Davos is as close as it gets to the red carpet. The forecast? Staid. Read more.
5:55 p.m: New CNBC-Dow Jones video posted. Novartis CEO Dan Vasella discusses his company's pipeline and outlook for 2006.
1 p.m.: Adam Cohen of Dow Jones Newswires reports. Ukraine will pay for all the Russian natural gas it uses, the country's economy minister Arsenii Yatseniuk said. He denied the country was stealing from pipelines that traverse the country, carrying about 25% of Europe's gas supplies. “The situation has returned to normal,” Mr. Yatseniuk said on the sidelines of the World Economic Forum. “Gas is flowing and at the end of the month, Russia will calculate how much gas has traveled through Ukraine and we will calculate how much gas we have used.”
12:30 p.m.: WSJ's Greg Hitt writes in Washington Wire. Major players in global trade talks shouldn't count on the U.S. continuing negotiations after mid-2007, when President Bush's trade-negotiating authority is due to expire. U.S. Trade Representative Rob Portman warned it would be “very difficult in this environment” for the White House to secure congressional approval of even a short-term extension of the trade authority. More.
11:45 a.m.: CNBC-Dow Jones video posted. NYSE CEO John Thain comments on expansion plans, the integration of Archipelago and the impact of hybrid trading. Also, Motorola CEO Ed Zander discusses new handsets and converging technologies.
9 a.m.: Billionaire George Soros said Iran was taking advantage of the U.S.'s engagement in Iraq to build its nuclear arsenal is a global threat. “I'm very worried about the global political situation, the power and influence of the United States has decline precipitously” since the Sept. 11, 2001 attacks, Soros said in a CNBC interview. Soros said Iran was not likely to change its mind after deciding to push ahead with building nuclear capacity. “For Israel and the United States, a nuclear-armed Iran under the present leadership is just simply unacceptable,” Soros said. “So we are heading for a collision course, that is already casting a shadow on the oil market, so people are, I guess, building up reserves for that day.” (See the video.)
8:45 a.m.: Shares of Pfizer rose before the opening bell in New York despite a premature announcement in Davos that the FDA approved its drug Exubera, an inhaled human insulin powder. Pfizer CEO Henry McKinnell appeared on CNBC earlier (see video) and said the drug had gained FDA approval, only to retract it later. Mr. McKinnell said Pfizer expects a decision soon, and that the earlier, incorrect statement was due to a mistake in the company's internal communications.
8:30 a.m.: Global trade talks appeared deadlocked as ministers skirted the main issue of cutting tariffs and subsidies, instead concentrating on setting timetables for more meetings. Six trade ministers, as well as WTO chief Pascal Lamy, held a 90-minute gathering on the sidelines of the World Economic Forum. But discussions centered mainly on the timing of future meetings instead of the issues that have deadlocked the Doha round of talks.
DAVOS 2006
• Framing the Issue: See what issues are on the agenda and who's attending the annual meeting.
• Forum's History: The World Economic Forum grew out of an initiative to bring together Europe's chief executives for an informal gathering in Davos in 1970.
• Complete coverage
8:15 a.m.: With both Davos and the Sundance Film Festival being held this week, the planet's most important people need to make finely calibrated calculations as to which event confers greater status, Slate says. It doesn't help matters that the agendas of the two events are converging and that a fundamental tenet of both conferences is that creative and brainy people do their best thinking while skiing, says the online magazine, which offers a list of attendees, panels and other events at the two gatherings and invites readers to match each with either Davos or Sundance.
8 a.m.: Europe must cut government spending and reform its labor market to revitalize its sluggish economies, the president of the European Central Bank and the EU's economic chief said. “The level of government spending is too high,” ECB President Jean-Claude Trichet told a meeting at Davos. Joaquin Almunia, the EU commissioner for economic and monetary affairs, agreed – saying that European governments should not try to spend their way out of economic doldrums. Instead, he warned, governments need to focus on economic reform. “Imposing services [reform] is the key issue to economic reforms,” Mr. Almunia said, adding that such reform should be pushed through after 2007 elections in France, one of the most vocal opponents of the EU's current services directive.
7:15 a.m.: Sen. John McCain said interrogation techniques at the U.S. prison camp in Guantanamo Bay are still of concern and the cases of the prisoners — some of whom have been held for four years without charge — should be processed. “What I was concerned about and continue to be concerned about is interrogation methods,” Sen. McCain told the Associated Press on the sidelines of the World Economic Forum. “What is critical is we adhere to treaties that we are signatories to and observe basic human rights and obey the law that we just passed concerning cruel and inhumane and degrading treatment.”
Gates
6:30 a.m.: Bill Gates pledged to triple the funding for eradicating tuberculosis and health experts urged renewed caution against the spread of bird flu as the World Economic Forum took aim at eradicating and containing illness. Funding health-care initiatives, at least with private money, has been problematic, Mr. Gates said. “In health, there's real problems in that the people who have these diseases don't have the money to justify the investment,” he said. More.
4:50 a.m.: China is set to become the biggest user of broadband in the world, Bill Gates told Davos delegates. “No one will catch up [except] maybe India in 50 years,” the Microsoft chairman said. He said that despite the disparity between China's urban and rural areas, the country was on track toward reducing poverty, meaning more people would be able to afford broadband Internet access. “The greatest surprise in poverty reduction .. is China,” Mr. Gates said.
4:45 a.m.: Senior Arab business leaders are confident about the region's economic prospects, according to a pan-Arabian survey to be released Friday in Davos. Forty% of 140 top executives in financial-services, health-care and travel companies reported an annual growth rate exceeding 20% for the past three years, according to the Arab Business Leaders Intelligence Report. And 94% expect economic conditions to improve during the next year. The executives pointed to a need to invest in workers' training and development and in information technology. The survey focuses on Algeria, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Syria, Tunisia, UAE, and Yemen. The report is being published by PricewaterhouseCoopers and Moutamarat, a conference and research firm that is a joint venture between Dubai Holdings and Saudi Research & Publishing Co.
4:30 a.m.: Europe's biggest challenge if it wants to reduce future dependency on external energy supplies is to cut oil consumption for transport, EU Energy Commissioner Andris Piebalgs told Reuters. Mr. Piebalgs is working on proposals for a common EU energy policy and said he hopes that measures to encourage manufacturers to boost vehicle efficiency will be included. “I think this is the biggest challenge we have,” he said. “Transport consumes a lot of oil. Even if we can't establish a legal framework for it, energy efficiency should really be a Europe-wide policy.”
3:45 a.m.: Microsoft's Bill Gates said that beating software piracy in China and India and getting compliance up to U.S. and European levels would take 10 years, Reuters reports. “In India and China it will be a decade before we get that level,” Mr. Gates told business leaders at Davos. “But as long as there is year-by-year progress, it holds a great opportunity for us in terms of scale, which helps us do more, and it's a great place where we have people working for us,” he said. Mr. Gates said sales of the company's software in both countries were increasing every year and he was optimistic that China and India would come round to licensing as Taiwan and South Korea had done.
2:45 a.m.: Bill Gates is set to join British treasury chief Gordon Brown to announce an initiative for funding efforts to fight tuberculosis in the developing world. The threat from TB and other serious diseases is bidding for equal attention with the Hamas victory in the Palestinian elections, terrorism and Iran at Davos.
1:30 a.m.: John Bogle, founder and former CEO of Vanguard Group, explains in a WSJ commentary why he's skipping Davos. With apologies to Bono, the “other Michael Jordan,” Christo and others, Mr. Bogle says his absence is “mostly because what was once truly a global economic conference has become a “happening'.”
12:45 a.m.: Davos Notebook A publishing slip sparks discomfort and an apology; Bono does his thing; and more.
12:30 a.m.: In Davos to tout his country's economic rebound, Egyptian Prime Minister Ahmed Nazif instead found himself analyzing the Palestinian earthquake that brought Hamas to power, writes WSJ's Frederick Kempe. Mr. Nazif urged the U.S. and Europe not to cut off Palestinian funding, but give Hamas — which did much to popularize suicide terrorism — time to settle into the responsibilities of leadership. “We have to give them some space,” he said. “They have not been tested in this environment.” At the same time, he said Egypt would act as a “mediator” due to its open channels to Hamas.
Thursday, Jan. 26
10:30 p.m.: A human bird-flu pandemic could ground up to 70% of aircraft, Virgin Group boss Richard Branson said. “You're just going to have to be strong enough to keep your head down for a year,” the entrepreneur behind Virgin Atlantic Airways told business leaders at Davos, Reuters reports. “If it happens, an airline is going to have 50% of its planes grounded, maybe more – 60%, 70%,” he said. Air travel, which was crucial in spreading the deadly SARS virus in 2003, is expected to be in the frontline should bird flu become easily transmitted between people. See more in the Bird Flu News Tracker.
5:20 p.m.: CNBC-Dow Jones video posted. Cisco Systems CEO John Chambers talks to CNBC's Maria Bartiromo about the company's business strategies. Also, David Stout of GlaxoSmithKline, Victor Chu of First Eastern Investment Group, Deepak Advani of Lenovo Group and Stephen Roach of Morgan Stanley discuss avian-flu preparedness as well as investment opportunities in China.
4:35 p.m.: Dow Jones Newswires' Adam Smallman reports. Signaling level-jitters about energy security, an annual Davos simulation of a terrorism-prompted oil supply shock filled up with chief executives even before this week's meeting started. In previous years, just government officials have attended. Thursday night's simulation drew executives from Royal Dutch Shell and Petroleo Brasileiro SA, among others. The premise: Leaders of the G-8 have called on the private sector to figure out what to do when terrorists coordinate attacks that throttle key crude supply flows, causing prices to jump. Their answer: oil producers and international reserves could cover a drop of some four million barrels a day for more than a year. The hard part: knowing how markets and consumers would respond.
4:30 p.m.: Dow Jones Newswires' Serena Saitto reports. The business elite took a few jabs at the Sarbanes-Oxley Act, which imposed tougher corporate accounting and other standards in the wake of the Enron fraud scandal. During a dinner with the theme “Escaping Public Tyranny,” private-equity firm executives lamented the time and money spent complying with the law. A few suggested publicly traded companies should go private to escape the law's requirements. David Rubenstein, founder and managing director of Carlyle Group, added an offer for the law's authors — U.S. Sen. Paul Sarbanes and U.S. Rep. Mike Oxley, both of whom are due to retire in January 2007. “We want to hire them and put them on the board of some of our companies so that they would see the mistakes they made,” Rubenstein said to enthusiastic applause. Later the head of one of the world's largest private-equity firms stressed he was joking. “It would be good if they served in a public company,” said Rubenstein. “But we are not hiring them.”
2:05 p.m.: MarketWatch.com's Aude Lagorce reports. Nothing illustrates better India's desire to rival the rising international status of China than the massive charm offensive India is mounting here. A huge Indian delegation consisting of 150 members — including three cabinet members and 41 chief executives — is using every opportunity to tell the movers and shakers that India can be a profitable market for foreign investment and not just a service-sector economy. More.
1:40 p.m.: Sen. John Kerry, who narrowly lost the 2004 election for U.S. president to George W. Bush, said he hasn't ruled out another run. Asked whether he would run again, Kerry told the Associated Press at Davos. “We'll tell you somewhere down the line.” Asked whether he would not rule it out, Kerry said: “No — I haven't.”
Musharaff
12:55 p.m.: Pakistan President Gen. Pervez Musharraf said Thursday that Iran should not be allowed to develop nuclear weapons. “Their security is not threatened,” Musharraf told the World Economic Forum. Video.
12:50 p.m.: Dow Jones Newswires' Serena Saitto reports. An embarrassing detail slipped through the normally tight organization of the annual meeting. An article in the forum's glossy and online magazine, The Global Agenda, called on the “global civil society to boycott Israel until it ends its Apartheid-like treatment of Palestinians.” The article, written by former Yale professor Mazin Qumsiyeh, was removed from the online magazine Thursday and WEF executive chairman Klaus Schwab issued an apology. “This article is totally in contradiction to my own, and the forum's, mission and values,” Mr. Schwab said in a written statement. The timing of the incident was particularly uncomfortable as Davos participants discussed the strong showing of militant Islamic group Hamas in this week's Palestinian legislative election.
Mandelson
11:45 a.m.: EU trade chief Peter Mandelson insisted that Europe is “united” in its stand on farm trade and that Brussels wouldn't make any more concessions on agriculture until its trading partners first offer to cut trade barriers in industrial goods and services. “We can't be expected to make a further offer in agriculture in order to pay to keep others at the negotiating table,” Mr. Mandelson said. “Europe is willing to give more than it has offered, but it is not prepared to ask for nothing in return,” he said. Mr. Mandelson suggested that the EU is prepared to risk the current round of trade talks breaking down. “If the talks stopped, we would lose next to nothing,” he said.
11:30 a.m.: News CNBC-Dow Jones video posted. Becton Dickinson Chief Executive Edward Ludwig speaks from Davos about the medical-products company's moves to experiment with stem cells to develop a cure for diabetes.
Portman
11:15 a.m.: U.S. trade chief Rob Portman said new German Chancellor Angela Merkel could help advance stalled global trade talks by offsetting the protective mindset of French officials in EU policy, the Associated Press reports. A key issue holding up talks has been access to EU farm markets. Mr. Portman, speaking on the sidelines at Davos, said Germany could act as a counterweight to France, which has been particularly defensive in wanting to protect its agriculture markets. “I was very impressed with her willingness to engage,” Mr. Portman said of Mr. Merkel. “I'm hopeful that she can help us to come together with an agreement this year.”
9:55 a.m.: News CNBC-Dow Jones video posted. Electronic Arts' Gerhard Florin discusses whether the videogame industry has a negative impact on society.
Brin
9:40 a.m.: News CNBC-Dow Jones video posted. Google founder Sergey Brin talks to CNBC's Becky Quick about doing good in addition to not doing evil. At Davos, “I've been able to meet a number of our existing business partners, form new partnerships .. and also the social entrepreneurs who have fantastic ideas about health, poverty, the environment, and these are all issues we are interested in with our philanthropic arm, Google.org,” Mr. Brin says.
Blatter (right) with soccer champion Pele
8:30 a.m.: Soccer clubs should be docked points if their fans or players use racist abuse because fines don't have enough effect, FIFA President Sepp Blatter told a press conference in Davos. “I am so disappointed. It is a shame for football that in the year 2006, you still have racism,” Mr. Blatter said. “The only way to fight this is to do exactly what we have done when it came to violence. We have to take away the points because it happens in those leagues where the money is sufficient so, even if you gave a fine of $100,000, it would be paid the next day,” he said. “That does not change the attitude, so you have to go into a sporting sanction.” Legal experts at soccer's world governing body will decide in February what measures need to be taken to strengthen FIFA's anti-racism laws.
7:15 a.m.: Royal Dutch Shell Chief Executive Jeroen van der Veer said the oil company would consider making acquisitions or swaps up to a value of $10 billion to increase reserves. He also told Reuters in an interview at Davos that the Anglo-Dutch major would discuss security issues with the Nigerian government after the hostages currently being held by militants were released. He said repairs could not start on damaged oil infrastructure until discussions about ensuring security in the OPEC producer had taken place.
5:15 a.m.: U.S. Trade Representative Rob Portman said he hoped free-trade negotiations could be launched soon with South Korea, Reuters reports. Washington has mentioned South Korea as a possible partner in the past, but this is the firmest indication to date that the start of talks could be imminent. “We are not quite there yet. We still have some issues to discuss,” Mr. Portman told journalists in Davos. “I am hopeful we can do it soon,” he said when asked about the possibility of talks beginning with Seoul. The issue remains sensitive in South Korea, where farmers' groups are strongly opposed to liberalization.
4 a.m.: GlaxoSmithKline expects to start clinical trials of its vaccine against the H5N1 strain of bird flu in early April, David Stout, president of the company's pharmaceutical operations, told Dow Jones Newswires on the sidelines of the WEF meeting. Mr. Stout said the company will test the vaccine with two different boosters, and should have the first results about three months later. Production of the vaccine is expected to start by year end, he said. See more in the Bird Flu News Tracker.
3:45 a.m.: China's foreign-exchange policy is in a good position and requires no changes, People's Bank of China Gov. Zhou Xiaochuan told a Davos session. Mr. Zhou said Beijing's change last July from a fixed exchange rate against the dollar to a managed float linked to a basket of 20 currencies had introduced a great deal of flexibility. But he said China still faces pressure from the international community to let the yuan appreciate. “The floating band now is OK .. but it is not fully used,” Mr. Zhou said. He declined to describe the full details of the currency basket China uses, but said the dollar accounts for “much less than 50%.” In currency trading in Shanghai Thursday, the U.S. dollar closed at 8.0620 yuan. The currency was revalued at 8.11 yuan to the dollar last July.
1:30 a.m.: American Express, Converse, Gap and Giorgio Armani are joining with Bono, the rock star, to sell products under a new brand called “Red” that will dedicate some of its revenues to fight AIDS in Africa, the Financial Times reports. The effort, scheduled to be announced today in Davos, will include the creation of a “Red” American Express credit card that will be marketed first in the U.K. Other “Red” products will include Converse sports shoes made with African mud-cloth; a new line of Gap vintage-style T-shirts; and wraparound Emporio Armani sunglasses embossed with a “Red” logo, the paper says. “Red is a 21st-century idea,” said Bono, the owner of the brand. “I think doing the Red thing, doing good, will turn out to be good business for them.”
12:30 a.m.: WSJ's Jeanne Whalen reports. As concerns mount about a possible avian-flu pandemic, research scientist David Reddy has become the world's point man for a drug seen as the best available treatment for the bird-flu virus. Dr. Reddy is head of pandemic-flu planning at Roche, which has come under intense pressure to increase production of its antiviral Tamiflu and deliver the drug to countries experiencing bird-flue outbreaks. Such challenges are scheduled to be discussed Saturday at a WEF session on “Containing a Global Pandemic.” More.
Wednesday, Jan. 25
11 p.m.: News CNBC-Dow Jones video posted. WSJ's Alan Murray reports from Davos on Carl Icahn's battle with Time Warner. See related column.
7 p.m.: MarketWatch.com's Aude Lagorce reports. Economists at the meeting said the dollar is on a downward slope. “I see a substantial amount of dollar decline in store in the medium term, perhaps as much as 30%,” said Laura Tyson, dean of the London Business School, suggesting the fall would likely be triggered by a switch to lower interest rates in the U.S. Min Zhu, executive assistant to the president at the Bank of China, was less of a Cassandra, saying he sees the dollar depreciating no more than 3% to 5%. More in Davos Notebook.
4:15 p.m: Intel Chairman Craig Barrett, speaking to CNBC from Davos, said India and China and their emerging economies are the big story around the world today. “I think the big issues are the availability of IT capability to the emerging economies,” Barrett said. Barrett also pointed to the health-care industry, which he said lags in using information technology to improve efficiency and provide better quality care.
Musharraf
2:30 p.m.: WSJ's Marc Champion and Frederick Kempe report. Pakistan's President Pervez Musharraf said his country would build a planned gas pipeline from Iran alone if three-way talks with India continue to produce no result. The remarks came at a delicate time for Musharraf, when he is having to balance domestic public opinion and relations with the U.S., India and Iran. Musharraf also said a U.S. missile attack on a Pakistani village that killed civilians earlier this month “probably” killed five to six al Qaeda operatives, but had “harmed our interests” by violating his country's sovereignty and feeding domestic unrest. More.
Merkel
2 p.m.: German Chancellor Angela Merkel said Wednesday she would like to see Germany's growth among the top three in Europe within a decade, adding that tackling unemployment and slow growth would take measured and creative actions.
1:45 p.m.: Dell Chairman and founder Michael Dell, in remarks on the sidelines of the conference, didn't rule out the use of Advanced Micro Devices semiconductors for the company's personal computers and servers. Asked if the company is going to use AMD chips, Dell said, “We don't have an exclusive relationship” with Intel, adding: “We have used [AMD chips] in the past, we might use them again.”
12:15 p.m.: Merck Chief Executive Richard Clark said the U.S. drug maker would consider the takeover of relatively big biotech companies if they bring in late-stage products and revenue. Merck would continue focusing on entering alliances with biotech firms and buying the marketing rights to products such partners developed, he said in an interview with Dow Jones Newswires here. “The other thing we are focusing on is targeting organizations that — if they are larger biotech companies — could not only help from the research point of view with late-stage products, but also with revenue,” he said. Mr. Clark said he was reassured that investors have understood the company's initiatives to turn Merck around following the withdrawal of Vioxx.
11:45 a.m.: French Finance Minister Thierry Breton said there were no signs of inflation in France, and he is confident that oil prices would not reduce the country's economic growth rate. “Inflation is extremely well-contained in France, and was extremely low in 2005,” Mr. Breton said. His comments come as European finance ministers are pressuring the European Central Bank to keep interest rates on hold, after notching them higher in December. Mr. Breton said that he was confident that, despite rising oil prices, France's GDP growth rate in 2006 would be 2.0%-2.5%.
11:15 a.m.: Intel Chairman Craig Barrett announced plans to train an additional 10 million teachers in developing nations over the next five years in the use of technology to enhance learning. The plan significantly expands an Intel initiative that has trained three million teachers in 35 countries since 2000.
10:15 a.m.: Under the headline “Why Davos is necessary,” Guardian economics editor Larry Elliott writes that “Davos – however inadequately and however incompletely – fulfills a need. Even a couple of hours spent in Davos reveals what this need is. There is a political reality gap between the avalanche of problems, global in their scope, precariously poised to descend on the unwitting citizens of the world, and the creaking, nation-focused machinery for coping with them,” Mr. Elliott says.
Schwab
9:15 a.m.: This year, the World Economic Forum has decided to focus on chief executives rather than cinematic celebrities in response to feedback that business has been overshadowed by politics and important, but sometimes intangible, global “big issues.” So while politics will remain prominent, this year's program brings fewer set-piece “messages” from the world's political elite, the Financial Times reports. “We are moving away from broad global issues. But you always need something structured at the start,” WEF founder Klaus Schwab tells the FT. “And there's big interest to meet and hear Angela Merkel.” The new German chancellor will address the 2,340 delegates in Davos with this year's opening speech, to be followed by Zeng Pelyan, the Chinese deputy premier. Other important newcomers include Paul Wolfowitz in his capacity as president of the World Bank, and Ellen Johnson Sirleaf, the Liberian president, the paper notes.
5:45 a.m.: Indian drug maker Ranbaxy Laboratories is actively pursuing a handful of acquisition opportunities in the U.S. and elsewhere to boost its generics drugs business, its new chief executive tells Reuters.
4:30 a.m.: Failure to reform the IMF will leave it ill-equipped to handle future financial crises, according to working papers and a report prepared for the World Economic Forum, Reuters reports. Two major reform proposals have been outlined in a broader review of the IMF's role by academics and market participants for the WEF: 1) the IMF should adopt a foreign-exchange reference rate system to measure countries” progress in redressing macro-economic policies that threaten the global economy; and 2) the IMF should open a liquidity window so that it can act unconditionally as lender of last resort to countries.
Roach
4:15 a.m.: A gloomy forecast about the world economy greeted Davos delegates as the annual meeting got under way, as Stephen Roach, chief economist of Morgan Stanley, said markets and officials had developed “a dangerous degree of complacency,” assuming that an unbalanced world economy could continue without correction, the Associated Press reports. Asian central banks have helped to keep things going so far by supporting the U.S. economy much longer than could be expected, and the American consumer has continued to spent, Mr. Roach said. But the U.S. real-estate market is showing signs of slowing down, he said. More.
3:30 a.m.: The number of WEF delegates from India jumped to 80 this year from 30 last year – the latest sign of India's rapid integration into the world economy. And to judge from the Davos program, India is the country of the moment, the Financial Times says. Of the 244 scheduled sessions, a dozen are devoted to India, twice as many as last year, while 60 feature Indian speakers. India's high-profile “India Everywhere” campaign is a tacit recognition that the nation may have only a limited window to translate today's unprecedented interest into hard investment, the FT says. The government has dispatched what it calls its “dream team” of economic reformers – led by P. Chidambaram, finance minister, Kamal Nath, commerce minister, and Montek Singh Ahluwaliah, deputy chairman of the Planning Commission. They will carry a simple message: trust us and invest, the paper says.
DAVOS 2006
• Framing the Issue: See what issues are on the agenda and who's attending the annual meeting.
• Forum's History: The World Economic Forum grew out of an initiative to bring together Europe's chief executives for an informal gathering in Davos in 1970.
• Complete coverage
3:15 a.m.: The atmosphere at Davos is a decent barometer of economic and political stability in the world, and this year, WEF founder Klaus Schwab predicts, the mood on economics will hover somewhere between hope and foreboding. “If you look at national economic forecasts, there was a feeling that this would be a good year,” Mr. Schwab tells the New York Times. “Now, there are suddenly question marks. People are really concerned about what will happen,” he says.
2:45 a.m.: India's new “India Everywhere” campaign isn't everywhere yet, but it's definitely in Davos, writes India's Business Standard newspaper. The campaign, which promotes India as the world's fastest-growing market democracy, is spearheaded by Infosys Chief Executive Nandan Nilekani, the paper points out. “As India becomes increasingly prominent in the global economic context, the WEF at Davos is the ideal place for us to project ourselves,” Mr. Nilekani tells the paper. The second and the third phase of the communication campaign will be unveiled during the Davos meeting, it says.
1:30 a.m.: It's already clear who is pulling out all stops to be this year's star attraction at Davos: India. Driving into the snow-covered village, one can't avoid the onslaught of Indian advertising that's been plastered across buses and along roadsides, writes The Wall Street Journal's Frederick Kempe. And India chose the eve of the meeting to announce a long-awaited partial liberalization of foreign-direct-investment rules. More.
12:30 a.m.: When China joined the WTO in 2001 – committing to open its then-struggling banking sector to full competition by 2007 – skeptics predicted the country's banks would be swamped by better-capitalized foreign institutions. This week, as leaders at the World Economic Forum's annual meeting debate the fiscal fitness of China's banks, it appears the doomsayers have been wrong, or at least premature, The Wall Street Journal's Rick Carew writes. China has injected fresh capital into its biggest banks, set up corporate boards with independent directors and pushed them to list abroad. Foreign investors have responded by putting up more than $16 billion for pieces of Chinese banks. More.
Tuesday, Jan. 24
Schwab
6:15 p.m.: Klaus Schwab has been the idea man behind the World Economic Forum since its founding. In an interview with Anita Greil of Dow Jones Newswires, he reflects on the past and future of the global gabfest, his best and worst Davos moments and inviting celebrities. More. (Read the transcript.)
6 p.m.: When 2,000 businesspeople, politicians, celebrities and journalists from around the world gather in the Swiss ski resort of Davos to network next week, the buzz probably will center on energy security, The Wall Street Journal's Marc Champion writes. More.
5:30 p.m.: The World Economic Forum is considering holding a major meeting in China, as the nation is generally underrepresented at the Davos summit, which conflicts with the Lunar New Year, Goran Mijuk and Anita Greil of Dow Jones Newswires report. More. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Times: First picture of Nigeria hostages

Nigel Watson-Clark, Harry Ebanks, Patrick Landry and Milko Nichev (Cannot display photograph at present)
By Jenny Booth and agencies
Nigerian militants today broke off talks over the release of four kidnapped western oil workers who have been held for 16 days on the Niger delta.
A message from the kidnappers stated bluntly that the government was failing to respond to its demands for a $1.5 billion ransom from the Shell oil company which employed the men, and the release of two local ethnic leaders held by the Nigerian authorities.
“Those guys are not going anywhere. The Nigerian Government still fails to understand that this is different,” said a statement from an e-mail account which has previously been used by the kidnap gang.
“They will not be released for any reason other than that specified in all our statements. We are not discusing with anyone for a while. This is in reaction to the Nigerian Government’s non-appreciation of the situation at hand,” it added.
Today Nigerian security sources released the first photo of the four hostages to be seen since their kidnap, showing Nigel Watson-Clark, a British security expert, Harry Ebanks, a Honduran engineer, Patrick Landry, a US boat skipper, and their Bulgarian colleague Milko Nichev.
The four were kidnapped on January 11 by heavily armed ethnic Ijaw militants who stormed their supply vessel, the Liberty Service, as it worked in the EA offshore oilfield for the energy giant Shell off the delta coast.
The picture is thought to be at least four days old. It shows the men sitting on plastic chairs in a palm oil grove guarded by three Nigerian guerrilla fighters, one of whom is equipped with an assault rifle.
The men appear to be uninjured. Three are wearing the shorts and polo shirt combination favoured by westerners working in the field, while Nichev sports blue overalls. All four have a bottle of orange liquid at their feet.
Various e-mailed statements identify the hostage-takers as hardline elements of the 14-million-strong Ijaw ethnic group seeking to seize control of the oil resources lying under their land in the delta region.
The gang has demanded the huge ransom from Shell to compensate Ijaw communities polluted by the oil industry. A series of attacks on oil facilities over the past two weeks has killed at least 22 members of the security forces and three Nigerian oil workers, and shut down more than eight percent of the country’s oil production.
In the southern city of Yenagoa, a ramshackle boom town surrounded on three sides by the winding creeks of the Niger Delta, government spokesman Ekiyor Welson continued to predict a rapid end to the hostage drama.
“The hostages are safe. We’re almost getting there. The negotiators have been able to make an agreement and very soon they will be released,” he claimed.
Since the kidnapping, armed gangs have blown up a major oil pipeline and attacked two oil facilities, killing a total of 22 police and soldiers and three Nigerian oil workers. It is not clear if the attacks are linked.
Shell has cut production by 221,000 barrels since the start of the crisis and has warned that tankers arriving to pick up crude at its Forcados export terminal might have to wait for up to two weeks to load.
Oil prices today surged past $67 for the second time since the start of the crisis, after the militants threatened more attacks on foreign workers.
Nigeria is Africa’s biggest oil exporter, producing 2.6 million barrels of highly prized sweet light crude per day, and accounting for ten percent of the United States’ oil imports. read more

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Petroleum News: Web posting calls for attacks on pipeline

Site claiming al-Qaida affiliation; nonprofit translated information in December; security agencies, Alyeska, aware of posting
The Associated Press
A Web site claiming to be affiliated with al-Qaida has called for attacks against the trans-Alaska oil pipeline.
The posting calls on jihadists to shower the pipe with bullets or hide and detonate explosives along its length, the Anchorage Daily News reported. It also calls for attacks on the Valdez tanker dock.
The unknown author encourages small cells of four or five mujahedeen, or Muslim guerrillas, living in the United States or in Canada or Mexico to mount the attacks.
The 10-page posting includes numerous links to Web sites providing maps and other information about the pipeline.
Attacking oil and gas targets in the United States and other countries is key to bringing down the economy of the “American devils,” the author wrote, saying the message was posted in response to calls from Osama bin Laden and his top al-Qaida deputy, Ayman al-Zawahri.
The Arabic posting was discovered and translated in late December by the SITE Institute, a Washington, D.C., nonprofit organization that tracks international terrorists.
There is no way to identify the author or know whether it could inspire an attack, said SITE director Rita Katz.
Security agencies aware of posting
Spokesmen for the FBI and other security agencies said they were aware of the posting. None would say whether it had prompted extra measures in Alaska.
Curtis Thomas, a spokesman for the Alyeska Pipeline Service Co., the oil company consortium that runs the 800-mile pipeline, said his company also was aware of the posting.
“We’re not aware at this time of any imminent threat,” he said.
Company policy prohibits discussion of security procedures, staffing levels or other issues, he said.
FBI spokesman Eric Gonzales said the posting did not seem to contain information beyond what is readily available to anyone with a little digging.
“I don’t think it’s a secret to anyone that the trans-Alaska pipeline, the terminal at Valdez, is a critical asset not only to the state but the country,” Gonzales said. “It’s stating the obvious — that this pipeline plays a critical role in this nation’s economy.”
Line carries about one-eighth of U.S. production
The Alaska pipeline carries more than 800,000 barrels of crude a day from the North Slope oil fields to the Valdez tanker port, about one-eighth of the U.S. production. The author notes that 300,000 gallons of crude oil spewed out of a bullet hole in 2001 and that the pipeline is largely above ground, exposed and close to a highway.
A Livengood man was sentenced to 16 years in state prison after his conviction for oil pollution, criminal mischief, handling a firearm while drunk and other charges. Authorities say he shot the pipeline with a .338-caliber hunting rifle.
Pipeline operators have found numerous other bullet strikes over the years that did not puncture the pipeline’s steel wall.
Security for the pipeline and Valdez tanker dock was heightened after the Sept. 11, 2001, terror attacks in New York City and Washington, D.C. One of the biggest changes was creation of a security zone the Coast Guard enforces around the dock. The zone remains in effect.
Posting contains errors
The posting includes numerous errors, including a sentence saying the pipeline starts at the North Pole and ends at Valdez “on the Atlantic Ocean.”
Katz, the SITE director, said her organization has analyzed and translated many terrorism-related Web postings for its clients, including oil companies, and this one stood out.
“When I saw this message, I was shocked,” Katz said. It was much longer, more thoughtful and more fully researched than the normal posting, she said.
The posting might have come from anyone. What’s more important than the source is the influence it might have.
“Once there’s an idea there, then you don’t know who saw that idea and might take the initiative and go forward,” she said.
“We take all of these matters quite seriously,” said John Madden, state Homeland Security director. However, the posting was “not any great, analytical document,” but rather a collection of information available from open sources.
In December federal pipeline regulators ordered Alyeska to develop new spill cleanup drills with “terrorist attack scenarios” in mind. read more

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Petroleum News: Chavez: Venezuela will get $1.5 billion more

Additional income will come from return of 32 privately operated fields to state control; government has also audited companies
Natalie Obiko Pearson
Associated Press Business Writer
President Hugo Chavez said Jan. 20 that Venezuela expects to reap an additional US$1.5 billion this year in oil income with the return of 32 privately operated oil fields to state control.
This “shows how important it is that a country manages its strategic resources,” Chavez said in a nationally broadcast speech.
Chavez’s government has declared as illegal contracts under which foreign oil companies like Royal Dutch Shell PLC, Chevron Corp., BP PLC, and Brazil’s Petrobras S.A. independently pumped oil at the Venezuelan fields.
He said Jan. 20 that those contracts allowed foreign companies to extract oil at US$4 a barrel then sell it to the national oil company, Petroleos de Venezuela SA, or PDVSA, at US$20. The contracts also required PDVSA to pay the related royalties.
New state-controlled JVs required
The government recently made all companies sign agreements to give up those contracts and form new state-controlled joint ventures, known as “mixed companies,” with PDVSA.
“Now this perverse mechanism is over,” Chavez declared as he promised to divert the additional revenues from the mixed companies to social programs.
In its effort to squeeze more money from the industry amid high oil prices, the government conducted an audit of the companies and claimed they owe billions of dollars in unpaid taxes.
On Jan. 20, the tax agency, however, sharply revised downward its tax bill for Royal Dutch Shell, saying the company owed US$13 million instead of US$130 million for the tax period from 2001 to 2004 — a 90 percent cut.
The agency said in a statement that it reached the figure after reviewing tax documents that the company submitted following the original bill last year.
Chavez: foreign companies have looted Venezuela
Chavez, who accuses foreign oil companies of having looted Venezuela, has promised his socialist “revolution” is freeing the country from “imperialist” interests and restoring its sovereignty.
On Jan. 20 he also said that Venezuela plans to replace domestic fuel consumption with natural gas in order to export an extra US$9 billion worth of petroleum a year.
“We are consuming in fuel — gasoline, gas oil, fuel oil — about 50,000 barrels a day of petroleum. When there comes a point in the coming years that we are able to substitute that internal consumption with gas, we can export (that oil),” he said.
Venezuela would earn an extra US$25 million a day or US$9 billion a year with those sales, Chavez said.
Venezuela is the world’s fifth-largest exporter of oil. It has the largest proven oil reserves outside of the Mideast and the second-largest gas reserves in the Western Hemisphere. read more

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Petroleum News: Oil could top $100 if U.N. sanctions Iran

Experts: oil prices could rise producing economic slowdown if Iran cuts oil exports in response to action against nuclear program
Brad Foss & George Jahn
Associated Press Writers
A surge in oil prices in mid-January to almost $70 a barrel on concerns about the restart of Iran’s nuclear program only hints at what may lie ahead.
Prices could soar past $100 a barrel, experts say, if the U.N. Security Council authorizes trade sanctions against the Middle Eastern nation, which the West accuses of trying to make nuclear bombs, and Iran curbs oil exports in retaliation. A sharp global economic slowdown could follow.
That’s the dilemma the United States and European nations face as they decide whether to act. But Iran would also pay a hefty price if the petro-dollars that now represent 80 percent of export revenues are reduced, potentially stirring civil unrest in a nation with a 14 percent unemployment rate.
“They would shoot themselves in the foot,” said Mustafa Alani, director of national security and terrorism studies at the Dubai-based Gulf Research Center. “It’s one thing to test the market psychology, it’s another to take the actual step and stop oil exports.”
Iran exports 2.5 million bpd
Iran, the second-largest oil producer within the Organization of Petroleum Exporting Countries, exports roughly 2.5 million barrels per day — 1 million barrels more than current excess production capacity worldwide. It also controls the strategic Strait of Hormuz, a critical shipping lane in the Middle East.
“Even if Iran pulled a small amount of its oil off the market, say it pulled a half million barrels a day, I could see oil prices literally jumping over the $100 per barrel mark,” said James Bartis, a senior researcher at Rand Corp.
But other oil analysts say prices would likely not climb much higher than $75 a barrel before strategic reserves would be released and demand would begin to taper off as economic activity slowed around the world.
So who would be hurt more? The United States and other nations say it would be Tehran and argue against succumbing to economic blackmail in any case. “We cannot be intimidated by economic threats from their side,” Sen. Trent Lott, a Mississippi Republican told CNN.
DOE: exports finance half of Iranian budget
The U.S. Department of Energy estimates that oil exports finance about half of the Iranian government’s budget. And while high oil prices have boosted the annual growth rate to about 5 percent, Iran has never really recovered from its 1980-1988 war against Iraq and trade restrictions on sensitive technologies. The Iran Nonproliferation Act, which the U.S. Congress passed in 2000, deters international support for Iran to develop nuclear, chemical and biological weapons programs and missile-delivery systems.
For weeks, Iran’s state television has sought to show a people united behind the leadership, showing passers-by on Tehran city streets expressing their support for the country’s strivings for nuclear independence.
Still, Alani of the Gulf Research Center questioned “whether the ordinary citizens will be willing to risk sanctions and endure a lot of suffering like the Iraqis suffered for 13 years” under U.N. sanctions.
Consuming nations have reserves
Oil consuming nations, meanwhile, have at least one ace up their sleeves — crude reserves. The United States and other members of the International Energy Agency have a combined 1.48 billion barrels of oil in their emergency stocks. That’s equivalent to about 600 days of Iran’s net oil exports of 2.4 million barrels per day.
OPEC might be able to add 1.5 million barrels per day to world production, mostly from Saudi Arabia. And oil analyst Fadel Gheit at Oppenheimer & Co. in New York said Russia might be able to crank up exports by about 500,000 barrels once its domestic home-heating demand eases.
Gregory L. Schulte, chief U.S. delegate to the International Atomic Energy Agency, accused Iran the week of Jan. 16 of deceiving the world about its atomic program, declaring that moves to haul it before the U.N. Security Council were meant to deny “the most deadly of weapons to the most dangerous of countries.”
His comments were part of increasing international pressure on Iran since it removed seals from uranium enrichment equipment earlier in January and said it would start small scale work on the process that can make both fuel and the fissile core of nuclear warheads.
Who will blink first?
“It’s a very difficult situation where you don’t know which side is going to blink first,” said Leonard Spector, deputy director of the Monterey Institute of International Studies’ Center for Nonproliferation Studies.
It’s also not clear the United States could win a referral on sanctions at the Security Council, where members Russia and China are Iran’s main allies. Both have strong economic and strategic ties to Iran, with China a large oil consumer and drilling partner and Russia a key supplier of arms and nuclear technology and services for what Tehran says is a peaceful program. Additionally, oil-rich Russia would benefit from higher prices and increased demand for its crude if Iran’s oil were off the market.
Influential India, which imports 75 percent of the crude it consumes, some from Iran, is a wild card in the referral struggle.
It joined the U.S., Britain, France and Germany in September to back an IAEA resolution that set the stage for reporting Iran for violating the Nuclear Nonproliferation Treaty. But pressure is building on the Indian government not to vote against Iran when the 35-nation IAEA board meets Feb. 2 to consider actual referral.
“India must not allow itself to be dragooned into joining the Washington-led nuclear lynch mob against Iran,” The Hindu, one of India’s most influential newspapers, cautioned Jan. 19. “Aside from the lack of any legal basis for threatening Iran with sanctions, India should consider what the U.S. pressure on Tehran will do to international oil prices as well as to the overall security scenario in West Asia.”
The United States and its allies are thought to have the majority behind them on any vote for referral. Still they would like to see India, China and Russia on board — all three countries carry weight among other IAEA board nations, and Moscow and Beijing both have the power to veto any resolution before the Security Council on what to do about Iran, once it is referred. read more

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Petroleum News: Agip offices in Nigeria robbed; nine are killed

Onyema Godwin
Associated Press Writer
Camouflage-clad attackers raided an Italian oil company’s riverside offices in Nigeria, sparking a gunfight that left nine people dead before assailants fled by speedboat into the oil-rich delta’s waterways, police said.
The Jan. 24 attack on Agip’s offices in the southern oil center of Port Harcourt was the latest in a recent rash of violence across the restive Niger Delta that has killed nearly two dozen people, cut petroleum production in Africa’s largest oil exporter and helped push up prices of crude worldwide.
The attackers, wearing army-style uniforms, cruised up behind Agip’s riverbank facility in their boat, forced their way into the compound and stole about US$28,000 in cash before the shoot-out with security forces, said Samuel Adetuyi, the head of the police in the city.
Seven uniformed police, a plainclothed security official and one company employee died in the gunfight that ended when the attackers fled in their speedboat back into the region’s labyrinth of creeks and swamps, he said.
Eni has temporarily evacuated staff
Agip’s parent company Eni SpA said in Italy that it “has temporarily evacuated staff and contractors from the area of the base affected by the incident and the situation is currently under control.”
The company said there were others injured, but it was unclear how many. Italy said none of its citizens were among the dead.
A rash of attacks and kidnappings in recent weeks by militia groups demanding the release from prison of local leaders have cut Nigeria’s daily exports of 2.5 million by nearly 10 percent and claimed at least 23 lives.
But Adetuyi said there was no immediate evidence that the Jan. 23 attack on Agip was linked to that.
“I can’t confirm whether there is any link with militiamen,” Adetuyi said.
Much of Nigeria in poverty
Despite the massive amounts of crude pumped from southern Nigeria, much of the region remains in abject poverty and activist groups have been agitating for President Olusegun Obasanjo’s federal government to provide them with a greater share of state oil revenues.
At least 14 other people have been killed in oil-platform attacks and other violence since earlier this year.
Meanwhile, militants claiming to hold four foreign hostages elsewhere in the Niger Delta said the oil workers are in decent health but had been moved deeper into the region of swamps and creeks after the government failed to meet the captors’ demands. read more

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Petroleum News: Shell declares hand

Focused on offshore in Alaska, committed to using cutting-edge technology
Alan Bailey
When Shell announced its re-entry to the Alaska oil and gas industry through its purchase of a swathe of leases in the March 2005 Beaufort Sea outer continental shelf lease sale, many people speculated on the mega-major’s intentions. Those intentions became crystal clear on Jan. 20 when Rob Ryan, Shell Exploration and Production’s vice president for corporate affairs, addressed the Alaska Support Industry Alliance’s Meet Alaska conference in Anchorage.
“We’ve been watching for the right opportunity to re-enter the Alaska scene, and we believe that time has come,” Ryan told the conference attendees.
Ryan cited new technology and available capacity in the trans-Alaska pipeline as key factors in Shell’s decision.
“Shell’s re-entry focuses on the outer continental shelf with 102 leases now in the Beaufort,” he said. “We’re looking to try seismic this season (summer) and we’re hoping to drill our first well of this modern campaign no later than next year.”
Shell also purchased 33 nearshore and onshore leases in Bristol Bay in the state of Alaska’s fall 2005 lease sale Ryan said.
But Shell is no newcomer to Alaska.
“Since the 1950s Shell has explored almost all of the major Alaska basins,” Ryan said.
Ryan explained that in the 1980s Shell was a partner in six of the 12 Beaufort Sea discoveries and drilled four of the five exploration wells in the Chukchi Sea. But oil prices had not been high enough to justify development of any discoveries and the company relinquished all of its leases.
Ryan pointed out that, whereas Shell has not been active in Alaska in recent years, the company has been involved in some major Arctic projects in Russia, the Mackenzie Delta and Norway.
Global agenda
Alaska dovetails right into Shell’s current global business strategy.
That strategy consists of three themes: new material oil; more unconventional oil; and more integrated gas — Alaska enjoys huge potential to support all of these themes, Ryan said.
“We need to make Alaska one of Shell’s production heartlands in support of this strategy,” he said.
From the point of view of material oil, “there are still many unexplored and underexplored basins in Alaska,” Ryan said. There are major discoveries for those willing to make the commitment and develop them in a responsible manner, he said. And unconventional oil, especially in the form of heavy oil deposits, exists in billions of barrels.
Additionally, Alaska is rich in gas.
“We are excited about the positive steps to see that gas eventually gets to market,” Ryan said.
Ryan said that Shell also sees potential for a world-class liquefied natural gas project in the Bristol Bay area.
“One area that could provide relatively direct access to the U.S. and Asia-Pacific LNG market is Bristol Bay,” he said. “We look forward to the opportunity to one day acquire seismic and explore in the shallow ice-free waters of this prospective basin. We believe it can be done with no adverse impact on the fisheries or the marine mammals.”
Ryan emphasized that Shell did not see that type of LNG project competing with or undermining the proposed North Slope gas line development.
Shell sees new technology as a key component of Arctic exploration and development, especially in the ice-prone and stormy outer continental shelf offshore northern Alaska. Recent advances in subsea technology may, in particular, unlock oil and gas deposits in this challenging environment.
“Long distance subsea projects can extend our onshore reach without the need for permanent offshore structures,” Ryan said.
Ryan particularly cited the Ormen Lange gas field, offshore Norway, where subsea completions are being tied back 75 miles to onshore facilities. State-of-the-art remote operated vehicles have also made deep-sea work possible. In the United States, for example, Shell has used remote operated vehicles to repair the Mars field export pipelines that were damaged in last year’s Gulf of Mexico storms.
“You can imagine 3,000 feet of water and doing the repairs on two pipelines which were damaged by the storm entirely with remote operated vehicles,” Ryan said.
Shell’s experience in deep waters of the Gulf of Mexico also gives the company confidence that it can maintain product flow through pipelines in frigid water — the water temperature at depths of 8,000 feet in the Gulf of Mexico is similar to that in the Arctic, Ryan said.
“Over the past 10 years our deep-water operations have taught us much about how to keep oil and gas flowing in such frigid conditions,” he said. “Much of this technology is directly applicable to the Arctic subsea.”
But sea ice remains a major challenge, especially when drilling wells. Shell hopes to try the use of air cushion supported drilling rigs, with a hovercraft-like rig design pioneered on the Siberian tundra back in the 1960s. This type of rig could perhaps hover over ice after the end of the open water season.
“In areas where the open season is very short this type of drilling platform might be able to extend the drilling season by more than 50 percent, and so reduce exploration and development time and cost,” Ryan said.
Shell is also investigating the use of ice-resistant tension leg drilling platforms. Ryan said that this technology did not exist in a mature form when Shell last explored offshore Alaska. A study has now indicated that a flexible structure using a tension leg platform designed for Arctic applications could withstand sea ice up to six feet thick, he said.
The environment and communities
Ryan said that in addition to having clear oil and gas business objectives in its new foray into Alaska, Shell views environmental protection and the interests of local communities as top priorities “to cause no long term harm to the environment and to make a positive impact on the community.” Protecting the environment involves operating in the most responsible and safest manner, and leaving as small a footprint as possible, Ryan said. Working with local communities means being a good corporate citizen, providing jobs, respecting cultures and enhancing the lives of people.
“For Shell it just makes good business sense,” he said.
Ryan cited Shell’s Athabasca oil sands project in Canada as an example of community involvement. There the company worked with the local First Nations community to establish contracts for services such as heavy trucking, he said. That has resulted in local long term employment, with $1 million per year in local services 10 years ago growing to more than $20 million per year now.
And in the massive Sakhalin-2 project, in the Russian Far East, more than 75 percent of the 17,000 project workers are Russian and more than 40 percent of the workers are from Sakhalin Island, Ryan said. Shell has a 55 percent interest in that project, he said.
Ryan also described Shell’s efforts to minimize the impact of gas development around Wyoming’s environmentally sensitive Pinedale anticline, a critical habitat area for deer, antelope and other wildlife. He said that Shell has minimized the footprint of operations that produce 150 million cubic feet per day of natural gas from more than 60 wells. Additionally the company has funded local wildlife protection initiatives and taken other measures to minimize environmental impacts.
“By deploying portable gas processing units Shell has reduced flaring during completion operations 98 percent in just three years,” Ryan said. “… (That was) something that needed to be done and we’ve started to do it.”
And for Alaska, Ryan said that Shell is designing new and better emergency response systems for ice-covered seas and finding ways to protect endangered marine mammals.
Alaska communities
Shell has already started talking to local communities in Alaska about the company’s plans, Ryan said. In particular the company has been working to complete a conflict avoidance agreement with the communities for the upcoming exploration season. Ryan said that Shell pioneered this type of negotiation back in the 1980s.
“We have great respect for the people who live in the area in which we plan to operate, generations of whom have developed a livelihood and a culture in these extreme conditions, and for whom the Arctic is home,” Ryan said.
He said that Shell will also develop contracting strategies to support its exploration programs. The company anticipates development opportunities and jobs in the communities where it operates and sees many opportunities for local people if the company’s operations prove commercially successful.
Meantime the company has been moving ahead with a program of Alaska hire in support of its growing Alaska operations. Earlier in January the company announced the hiring of an Alaska management team consisting of Alaska Asset Manager Rick Fox; Alaska Government and External Affairs Manager Cam Toohey; and Community Affairs Manager George Ahmaogak Sr. Fox has previously worked in the Bering, Beaufort and Chukchi Seas; Toohey is a lifelong Alaskan; and Ahmaogak is a lifelong Alaskan, who was formerly mayor of the North Slope Borough, president of Ukpeagvik Inupiat Corp. and Piquniq Management Corp. and a member of the Interior’s National Outer Continental Shelf Policy Committee.
“We’re not done hiring,” Ryan said, adding that Shell also looks forward to working with Alaska Support Alliance companies. Shell wants to employ Alaskans with the critical skills needed to operate its future assets, Ryan said.
“To achieve this we will partner with the University of Alaska, the community colleges, industry liaisons and other as we search out proactively staff that can fill our needs,” he said. Meantime the company expects to hire about six interns this year, with a need for more interns in future as the operations mature.
“We really are glad to be back in Alaska,” Ryan said. “… The world needs energy and it’s no secret that Shell is in the energy business … and we believe responsible development of Alaska’s resources is in everyone’s best interests.
Ryan said that Shell wants to set the standard for socially responsible and environmentally mindful development.
“Alaska is a place of great vision, commitment and stamina,” he said. “We see how the land is and we intend to be part of it.” read more

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SEA TO SHELL: Local people confront Shell executives

An unscheduled meeting for Shell executives with concerned locals over the proposed controversial Corrib Gas project.
Last evening (25/01/06) saw an important step in the Corrib Gas dispute. The day was set aside for an executive team from the oil company Shell to meet with various groups involved in the controversial project. All meetings were behind closed doors and by invitation only, as a group of concerned locals found out when attempting to meet with the team in Belmullet.
It became known that a further meeting was to take place in the community centre in Greannaí, a short distance from Rossport, to discuss with locals the problems to date. An impromptu group of people, residents directly affected by the proposed refinery and associated pipeline, converged on the venue to take part in the event.
On arrival they were informed this was yet another private meeting, and were refused entry. This reflected an earlier statement from Shell that the team were seeking to meet with non-opposing landowners only. Clearly an unacceptable situation, the people asserted their right to be involved in any debate on something which affected their community so seriously, and in what was supposed to be their own community centre! The Gardaí present (as part of the security laid on for Shell) wisely used their discretion and allowed access to the gathering group.
Inside, a surprised looking collection huddled together to talk over the new arrangement. The team included Andy Pyle, MD Shell Exploration & Production Ireland Ltd (SEPIL); Nina Henderson, Non-executive Director of Shell Transport; and Wim Kok, former Dutch Finance Minister, Prime Minister, and Royal Dutch Supervisory Board member.
What followed was an informal, virtually one-sided debate on the conduct of Shell in the area. The people were highly insulted by the further attempt to exclude them from proper discussion, a fact that had continued to contribute to the growing rift between the developers and the community ever since the project was announced.
Andy Pyle attempted to justify the admitted mix-up over invitations by blaming the Rossport Five for not wishing to meet the team, and this was taken that everyone in Erris opposed to the current project were not interested. The fact that protests by hundreds of people at the Bellanaboy refinery site had taken place, and that thousands of people nationally and internationally had voiced their displeasure at the actions of the oils giants, seemed to be totally ignored by SEPIL, who had been charged with organising the meetings.
Some hard truths were presented to the executives who were informed that, given their past and current actions (here in Ireland and further afield in places such as Nigeria), under no circumstances would an experimental and potentially lethal refinery and pipeline be tolerated in the area. The not-so-polite message was, ''wake up and pull out … the people of Erris are not for sale!''
The evening passed off without incident (due in large part to the Gardaí handling things in a sensitive manner; unusual of late but very welcome) and the Shell crew left among cheers, jeers and even a few fireworks. The people on the ground, the people who have been living with this ongoing nightmare and the ones that really count, had finally got a chance to let the hitherto faceless corporations know what they really desired; a peaceful existence in a beautiful and unspiolt part of the world.
Surely not too much to ask. read more

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MSN Money: Shell Chairman: No Word Nigeria Hostages

All Associated Press NewsDAVOS, Switzerland (AP) – The managing director of Royal Dutch Shell said Friday he was unaware of any plans to free four workers seized from an oil platform in Nigeria earlier this month.
Speaking on the sidelines of the World Economic Forum's annual meeting, Jeroen van der Veer said there was no resolution of the hostages' fate.
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“I checked my e-mail 30 minutes ago, and there was no information,” he said.
Earlier in the day, the Nigerian daily newspaper The Punch reported that the workers, kidnapped in the Niger Delta, could regain their freedom “soon.”
Ekiyor Welson, press secretary to the governor of Bayelsa State, told the newspaper the impending release came after a deal was allegedly struck between the Nigerian government and the militants. He gave no details of the deal.
Nigerian President Olusegun Obasanjo did not comment about a deal.
“All I know is that the hostages will be released soon,” he told Dow Jones Newswires. “I can't tell you how many days.”
The four oil workers — a Briton, an American, a Bulgarian and a Honduran — were kidnapped at a Shell oil platform in the oil-rich delta Jan. 11. read more

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The New York Tmes: Nigeria Hostages Won't Be Released: Militants

By REUTERS
Published: January 27, 2006
Filed at 7:26 a.m. ET
LAGOS (Reuters) – Nigerian militants believed to be holding four foreign oil workers hostage said on Friday they did not plan to release them any time soon, dashing hopes of an imminent end to the 17-day crisis.
A spokesman for Bayelsa state, which is leading government contacts with the kidnappers, had said negotiators had reached a point where the foreigners — an American, a Briton, a Bulgarian and a Honduran — could be released at any time.
But in an e-mail to Reuters the militants said: “I promised you the hostages were going nowhere in spite of the rumors and repeat that to you.''
The militants added that more hostages could be taken soon.
The Movement for the Emancipation of the Niger Delta is demanding more local control over the region's huge oil wealth, the release of two ethnic Ijaw leaders and compensation to delta villages for decades of oil pollution.
It has launched a wave of attacks on oil pipelines and platforms which have forced Royal Dutch Shell, Nigeria's largest oil producer, to cut a tenth of Nigeria's output and withdraw 500 staff.
“As promised we will soon commence with our second wave of attacks. … We intend to inflict as much damage as we can with each attack (so) that careful planning and coordination is key,'' the militants said.
These militants, who have consistently denied being in any talks with the government and rejected any idea of release until their demands are met, have provided proof they are holding the hostages by allowing them to speak to Reuters twice.
There has been no contact with the hostages since January 20, when they complained of fatigue and diarrhea.
SECURITY TALKS
Nigerian President Olusegun Obasanjo said on Thursday talks with the hostage takers were progressing, and downplayed any effect on investment in the Africa's largest oil producer.
However, Shell Chief Executive Jeroen van der Veer said the company would not repair damage to its installations until it held talks with the government on improving security in the world's eighth largest exporter.
The rising militant threat in the delta, which produces nearly all Nigeria's 2.4 million barrels of oil a day, is entwined with political uncertainty ahead of elections next year and constitutes a threat to Nigerian unity, analysts Eurasia Group said.
Some of the demands of the kidnappers are echoed by the delta's politicians, who are vying with other geo-political zones for the ruling party's presidential nomination.
“There is a real risk that 2006 will be the year in which the essentially irreconcilable differences between Nigeria's Muslim north and mostly Christian south threaten the unity of the country,'' Eurasia Group said in a report.
Dozens of people have been killed in the attacks on two major oil export pipelines and two oil production platforms since December 20, although it is unclear if this week's attack on Italian oil company Agip, a unit of ENI, was by the same group.
More troops have been deployed to key oil installations, villagers have fled and Obasanjo has declined to say whether the crisis, now in its third week, will be resolved by force.
Many villagers in the vast delta of mangrove swamps and tidal creeks fear military reprisals for the killing of at least a dozen soldiers.
Oil unions have threatened to withdraw members completely from the delta if the security situation worsens.
Tensions in Nigeria helped drive oil prices above $67 a barrel on Friday but OPEC President Edmund Daukoru said he did not expect any cutback in supplies in his country to last.
“The drop is very very short term. … So I know the market is jittery but really there is not much need for concern for Nigeria,'' he said in Davos. read more

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Shell Insider: Botts will pop a vein once he sees this

FROM A SHELL INSIDER
Most people in Shell EP will know what this really means: Platenkamp talked back too much to Botts (head EPE) and is therefore eased out with someone who does not know anything about EP and is therefore more pliable. I call this ‘surrounding oneself with sycophants’. How does this jive with the wish of v.d.Veer to improve know-how and longer postings in EP?
A plain powergame and further ethnic cleansing of Dutchmen in EP. Something that even Lo van Wachem fought but without success. NAM is one of the biggest dividend payers of the Shell Group so normally one would put a professional in place. Remember that Platenkamp was the man who pointed out in 2000 to the top of Shell that there was another cycle of overpromise and underperformance in the making. They all refused to listen and take action. Now he is sidelined….
Internal Shell message: (The official Spin/BS)
Roelof Platenkamp, currently VP Commercial in EPE and MD NAM, will be appointed to a new role as VP Hydrocarbon Maturation (Chief Petroleum Engineer) in the EP Technical organisation, reporting to Matthias Bichsel, EVP Technical, with effect from 1st March 2006. Roelof will play a leading global role in coordinating our hydrocarbon maturation plans and he will provide functional leadership for the global Petroleum Engineering community. Roelof joined Shell in 1981 and has held various technical and managerial roles in several countries.
Roelf Venhuizen, GM Moerdijk – Manufacturing Chemicals, will be appointed to EPE VP Commercial and MD NAM with effect from 1st March. Roelf joined Shell in 1975 and has held various technical, commercial and managerial roles in the Netherlands and internationally in Shell’s Downstream Chemicals and Manufacturing organizations. From August 2000, until May 2005 when Roelf began his current role, Roelf was GM Shell Nederland Chemie BV (SNC) managing the Moerdijk and Pernis Chemical Manufacturing sites where he also sponsored the Shell Sigma beachhead project for Shell Chemicals.
Please join us in wishing Roelof and Roelf every success in their new roles. Roelf’s successor is subject to normal Open Resourcing, staff consultation and SNC corporate processes and will be announced separately. read more

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Nigeria Daily Independent: Shell Revamps 36 Ogoni Oil Spill Sites

By Odudu Okpongete
Senior Correspondent,
Port Harcourt
Anglo-Dutch oil giant, Shell Petroleum Development Company (SPDC), says it has completed remediation work in 36 oil spill sites out of 87 such sites identified in Ogoniland, Rivers State.
Shell puts the number of such sites identified in the Niger Delta between 1999 and June 2005 at 2,056, out of which it said remediation was successfully carried out in 586 sites.
Shell’s Corporate External Affairs Manager, Senibo Don Boham, disclosed the figures during an interactive session with journalists in Port Harcourt on Tuesday just as he lamented the gross underdevelopment in the region despite its huge oil wealth.
Boham, however, stated that the company was forced to discontinue the remediation of the Ogoni spill sites towards the end of 2004 after the indigenes interpreted the government exercise to mean resumption of oil exploration in the area.
He said in almost all the areas where the company had undertaken such remediation, the soil had been restored to its original state and the inhabitants able to carry out farming activities in such spots.
The company’s spokesperson attributed most of the oil spills recorded in the region in recent times to acts of sabotage, citing the case of Rumuekpe in Rivers State where 135 hacksaw cuts were inflicted on its pipelines in 2004 alone.
Boham further stated that Shell was deeply disturbed over the underdevelopment in the Niger Delta 60 years after it began oil exploration in the area, attributing it to abandonment by the Federal Government’s.
He stressed that if the government had implemented the recommendations of the Willinks Commission, which sought special funding for the development of the area, the prevailing poverty and restiveness witnessed there would have been adequately tackled. According to him, it was wrong for anybody to wait for pressure from foreign governments before giving attention to the region’s problems.
Boham disclosed that Shell spends about $60 million annually on development in its 1,600 host communities, but admitted that the figures which amounted to about N4 million per community was inadequate to meet the development needs of the communities.
He, therefore, appealed to the Federal Government to take the development of the Niger Delta as a priority while also appealing to state governments in the region to use the 13 per cent derivation revenue judiciously to tackle the endemic poverty in the area. read more

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Peoples Daily Online: Sustainability is core concept as energy giant Shell expands

Peoples Daily Online (China)
Global energy giant Royal Dutch Shell is using sustainable development as part of its business principles, balancing both short- and long-term interests when making its business decisions.
This year Shell China's largest capital investment, the Nanhai petrochemicals complex, moves into start-up phase.
The Dutch-based company has integrated economic, environmental and social considerations in the construction of the project, said Liu Xiaowei, deputy director of external affairs at Shell China.
Located in Daya Bay of South China's Guangdong Province, the co-operative project by Shell and China National Offshore Oil Corporation is so far the largest joint venture project in China.
With a total investment of 34.8 billion yuan (US$4.3 billion), it will manufacture 2.3 million tons of petrochemicals products to supply the markets in Guangdong and China's coastal areas, where demands for petrochemicals products are high, said Liu.
“As a crucial project for Shell in China, the Nanhai Petrochemicals Complex is being designed to international standards,” said Liu. “In order to do this we have taken a lot of measures, which can be broadly separated into three categories, energy efficiency, water conservation, and waste minimization.”
Liu said energy efficiency plays a major role in selecting which processes to use in the complex.
Hydrocarbon waste streams from the process plants, for example, are captured and used as fuel gas elsewhere in the complex.
As for the complex water use, using air-cooling to the fullest extent will minimize the amount of cooling water that is used. Compared with other complexes, it is expected to reduce the water use by 20 per cent to 25 per cent, said Liu.
Liu said the waste management strategy is based on handling waste internally. Waste that is generated will be reused or recycled to the maximum extent possible.
Liu said sustainable development has become a core value for Shell, which has practiced the concept in China for 3 years.
As part of its many sustainable development programmes, last year Shell signed an agreement with the Science and Technology Commission of the Shanghai municipal government, which is expected to help Shanghai develop clean and efficient energy solutions.
The MOA outlined a number of areas for co-operation, including joint studies on clean alternative fuels and cost-effective ways to save energy and reduce emissions in the transport sector.
Liu said the commission and Shell are already collaborating on two ongoing trials of clean gas-to-liquid fuel.
The new generation fuel is being used in a taxi trial involving Volkswagen Passat vehicles in Shanghai in co-operation with Tongji University. It will also be tested in a laboratory trial on Chinese-manufactured heavy-duty engines in partnership with Jiaotong University.
According to Jack Jacometti, vice-president of Shell Gas & Power, energy conservation is the building blocks for any city; the co-operation with Shanghai is setting an example for clean energy development.
Liu said Shell is also working hard to advocate the sustainable development scheme in public. This year is the second year of Shell's Rural Energy Fellowship programme. The programme, which focuses on rural energy issues, invites graduate students from top universities in China.
These students go out into the field to study rural energy and try to find solutions to improve community sustainability.
Source: China Daily read more

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Malaysia Star: Koc-Shell consortium pays US$4b for 51% of Turkish oil refinery

ISTANBUL: A consortium led by Turkey's Koc Holding and including Anglo-Dutch oil giant Royal Dutch Shell PLC officially purchased a controlling stake of Turkey's state-owned oil refiner Tupras on Thursday, a state-run news agency reported.
Paying US$4.14 billion (euro3.35 billion) to the country's Privatization Administration, the consortium officially took control of the 51-percent stake, according to Anatolia.
The payment valued Tupras at around US$8.1 billion (euro6.56 billion).
The consortium had outbid eight other competitors in 11 stages of bidding for what was one of the most important sales on Turkey's privatization agenda.
Koc Holding holds 75 percent of the consortium's shares, while Turkish gas company Aygaz has 20 percent and several other companies – OPET Petroleum, Shell Overseas Investment and the Shell Company of Turkey – all have less than 5 percent, Anatolia said.
The Koc family that runs Koc Holding placed 103rd on Forbes' 2005 list of the world's richest people. – AP read more

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The Scotsman: Oil giant ready to Shell out $10bn

JOHN BOWKER
DEPUTY CITY EDITOR
SHELL is prepared to spend as much as $10 billion (£5.6 billion) on a single acquisition despite the high oil price in what is the group's latest attempt to replenish its dwindling reserves.
The oil giant's chief executive, Jeroen van der Veer, said that deals of around that scale would create value for its shareholders, and he would not rule out an expansion into any geographic region around the world.
“Even in times of high oil prices, it's possible,” he said on the sidelines of the World Economic Forum in Davos. “You may do small acquisitions or swaps of up to $10bn.” However, he ruled out any larger deals as the high price of oil would make them uneconomic.
Shell, the world's third-largest listed oil firm by market value, is still living down a reserves scandal that shocked investors in 2004. The revelation that its oil and gas reserves were massively overstated sent Shell's shares tumbling.
The market is awaiting an update on Shell's reserve replacement progress at its annual results next Thursday. A year ago, the group reported that it found only 45-55 per cent of the oil it pumped in 2004, vexing investors.
One area where Shell is unlikely to expand is the North Sea. The group revealed in December that it was cutting back future exploration plans following a tax hike on production by Gordon Brown, while it put three of its fields in the maturing area up for sale last April.
Van der Veer was also keen to discuss troubled Nigeria, where Shell ranks as the biggest foreign producer. He said his first concern was for the safety of four oil workers held hostage by militants – a flash point in a five-week campaign of sabotage and kidnapping by the Movement for the Emancipation of the Niger Delta.
The crisis has pushed world oil prices to four-month highs and shut in 221,000 barrels per day of Shell's output in Nigeria.
“I expect the government would like to sit down with [the oil] industry and talk about what can happen on security and keeping the oil flowing,” Van der Veer said.
The Nigerian movement said it would make Shell suffer unless it paid $1.5bn to delta villages in compensation for decades of oil pollution, which is one of its demands for releasing the hostages. Van der Veer said repairs could not start on damaged oil infrastructure until discussions about ensuring security in the OPEC producer had taken place. “When the situation is safe again, then you can restart production very quickly,” he said.
The Dutchman added that Shell remained committed to increasing output of oil from so-called “unconventional” deposits despite some project cost overruns and a string of unplanned outages.
Shell has started a study for an oil shales project in Colorado, he said. It will test technology for heating oil underground there. Oil shales is a type of rock that can be turned into an oily substance at a high temperature – and can be found in Scotland.
Shell is also looking at oil deposits in ever-deeper water, and analysing deposits of tight gas, or gas left in reservoirs after conventional drilling. The group's shares closed off 6p at 1,835p. read more

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Daily Telegraph: Shell eyes acquisitions to give reserves a lift

By Melanie Feisst (Filed: 27/01/2006)
Shell chief executive Jeroen van der Veer said yesterday the company would consider making acquisitions of up to $10billion (£5.6billion) to increase reserves.
“Even in times of high oil prices it's possible, but not sure, that you may do small acquisitions or swaps of up to $10billion,” he said at the World Economic Forum in Davos, as the price of Brent crude veered around $65.
He said it was difficult to see where larger acquisitions could create value for Shell's shareholders.
Mr van der Veer also hinted that the group's spending may become more geared towards unconventional ways of gathering oil, such as drilling for oil in ever-deeper water and analysing deposits of gas left in reservoirs following conventional drilling.
He would not comment on possible group targets, but the most likely avenue is believed to be swaps or oil fields, as few oil companies are now worth less than $10billion. Shell is due to publish its full-year results on February 2.
Yesterday, Spain's largest oil company, Repsol, slashed its oil and gas reserves by 25pc, signalling trouble with it development prospects, primarily for natural gas in Bolivia and Argentina.
The majority of the revisions are in Bolivia, accounting for 52pc, and Argentina, 41pc, Repsol said in a filing to the Spanish regulator.
As a result of the downgrade, Repsol's reserves will fall to 3.672 billion barrels of oil equivalent from 4.926 billion barrels.
Repsol shares were suspended ahead of the announcement. They last traded at €24.78 (US$30.33). read more

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The New York Times: Nigeria Hostage Talks Making Progress: Obasanjo

By REUTERS
DAVOS, Switzerland (Reuters) – Nigeria is making progress in talks with the kidnappers of four foreign oil workers, President Olusegun Obasanjo said on Thursday, playing down any impact on investment in Africa's largest oil producer.
The four men were abducted from an offshore oilfield operated by Royal Dutch Shell 15 days ago by militants demanding the release of ethnic Ijaw leaders, more local control of oil wealth and compensation to delta villages for pollution.
“We are very much in contact with them,'' Obasanjo said. ''Immediately after it happened, we set up a committee … It's not only in contact, it's making progress.''
The Movement for the Emancipation of the Niger Delta's five-week campaign of violence and kidnapping has forced Shell to withdraw at least 500 staff and cut its output by 221,000 barrels a day, or one tenth of Nigerian exports, adding to fears of a global oil shortage.
Analysts have said the growing insecurity in Nigeria's southern delta, which produces nearly all of its 2.4 million barrels of oil daily, is raising the risks of doing business and scaring off some investors.
The army deployed more troops to key oil installations after armed men stormed the headquarters of Italian oil firm Agip in the delta on Tuesday, robbing a bank and killing eight policemen and one civilian. Agip is a unit of Italy's ENI.
Asked if he was concerned about the impact on oil investment, Obasanjo told Reuters at the World Economic Forum in Switzerland: “Not really.''
The militants have insisted they will not accept money for the hostages' release, and promised to stage more attacks to halt exports totally and drive away oil workers.
BREAKTHROUGH
Government officials in the southern Nigerian state of Bayelsa, one of six delta regions, said on Wednesday they believed the committee had made a breakthrough in talks to free the American, British, Bulgarian and Honduran captives.
“The hostages are close to being released, but I cannot be specific about a date,'' said Bayelsa Information Commissioner Nelson Azibolanari.
The release has been complicated by rivalry between Ijaw groups, which has risen since the impeachment of former Bayelsa state governor Diepreye Alamieyeseigha, one of the two Ijaw leaders whose release is demanded by the kidnappers. They have also asked for the release of militia boss Mujahid Dokubo-Asari, on trial for treason.
Villagers have begun to flee the delta's mangrove swamps and tidal creeks in fear of military reprisals against the highly organized, heavily armed group. Oil unions have threatened to pull members out of the region if security deteriorates further, after dozens of people have been killed in recent raids.
Obasanjo declined to comment when asked if he believed the crisis would be resolved by negotiation or by force.
“There are two situations, if you like. There's the immediate situation of the hostages, and we have to get the hostages released, and then there's the situation of criminality in the Niger Delta, that's a different issue altogether,'' Obasanjo told Reuters Television at Davos.
The militants' demands for more local control over the delta's oil wealth is echoed by the region's politicians, who are also vying with other zones for the ruling party's presidential nomination in elections next year.
Analysts say this means the violence against the oil industry is likely to continue into 2007. read more

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AP Worldstream: Koc-Shell consortium pays US$4.14 billion for 51-percent of Turkish oil refinery

A consortium led by Turkey's Koc Holding and including Anglo-Dutch oil giant Royal Dutch Shell PLC officially purchased a controlling stake of Turkey's state-owned oil refiner Tupras on Thursday, a state-run news agency reported.
Paying US$4.14 billion (A3.35 billion) to the country's Privatization Administration, the consortium officially took control of the 51-percent stake, according to Anatolia.
The payment valued Tupras at around US$8.1 billion (A6.56 billion).
The consortium had outbid eight other competitors in 11 stages of bidding for what was one of the most important sales on Turkey's privatization agenda.
Koc Holding holds 75 percent of the consortium's shares, while Turkish gas company Aygaz has 20 percent and several other companies _ OPET Petroleum, Shell Overseas Investment and the Shell Company of Turkey _ all have less than 5 percent, Anatolia said.
The Koc family that runs Koc Holding placed 103rd on Forbes' 2005 list of the world's richest people. read more

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AP Worldstream: Crude oil prices rise; hover under US$67 a barrel on geopolitical concerns

GILLIAN WONG
Crude oil futures rose Friday on persistent supply fears linked to Iran's nuclear standoff with the international community and militant attacks in Nigeria.
Light, sweet crude for March delivery gained 42 cents to US$66.68 a barrel in Asian electronic trading on the New York Mercantile Exchange midmorning in Singapore. The contract on Thursday rose 41 cents to settle at US$66.26 a barrel.
Heating oil gained 1.47 cents to US$1.7927 a gallon (3.8 liters) while gasoline advanced 1.52 cents to US$1.6995 a gallon.
“Geopolitical tensions remain in Iran and Nigeria. They pose potential threats to supply that together with the world's spare capacity tightness and strong global demand, keep a relatively high floor under crude prices,” said Victor Shum, energy analyst at Purvin & Gertz in Singapore.
Markets were concerned about the dispute between Iran _ the second-largest oil producer in the Organization of Petroleum Exporting Countries _ and the West over the restarting of its nuclear program. Iran insists the program is aimed at generating electricity, while the U.S. and several European countries fear it could lead to nuclear weapons.
In Nigeria, four foreign oil workers _ a Briton, an American, a Bulgarian and a Honduran _ are still being held hostage after being kidnapped at a Shell oil platform in the oil-rich delta on Jan. 11. Militants who say they are holding the men are demanding the release of two tribal leaders and for Shell to pay local communities US$1.5 billion (euro1.2 billion) in compensation for oil pollution.
The kidnappings came amid a spate of attacks on oil installations in Africa's largest oil exporter that have forced firms to evacuate hundreds of their workers and cut 10 percent of the country's daily oil output.
Meanwhile, natural gas futures rose 10.1 cents to US$8.330 per 1,000 cubic feet, after falling 23.1 cents to US$8.229 in the previous session _ their lowest level in almost six months, after U.S. government data showed domestic inventories were well above the five-year average for this time of year.
Above-normal winter temperatures in the U.S. have helped moderate demand, soothing a market that had otherwise been jittery because 16 percent of daily natural-gas production in the Gulf of Mexico remains shut-in nearly five months after Hurricane Katrina ripped through the region, knocking out platforms, pipelines and processing plants.
The U.S. Energy Department said domestic storage of natural gas stood at 2.49 trillion cubic feet at the end of last week _ 8 percent above year-ago levels and 22 percent above the five-year average for this time of year. read more

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Business Times (Malaysia): New Shell Malaysia chairman to head business council

NEWLY appointed Shell Malaysia Bhd chairman Saw Choo Boon will head the company's business council effective March 1. He will be the third Malaysian to hold such position since the establishment of the council.
He replaces outgoing Shell Malaysia chairman Datuk Jon Chadwick, who will be moving to another senior Shell position within Asia, also effective March 1.
In a statement, Shell Malaysia explained that the business council is the company's highest coordinating body.
It comprises the chairman, leaders of Shell Malaysia's key business portfolios in exploration and production, downstream oil and gas, the finance director and senior managers in human resources, information technology, legal and external affairs.
As Shell Malaysia chairman, Saw will lead the business council in shaping the company for greater growth in Malaysia.
Additionally, he will retain his current downstream oil responsibilities as well as serve as chairman of the boards of several companies where Shell Malaysia has business interests.
In the statement, Shell Malaysia also announced the revision of the business council leaders as well as appointment of several new council members. New members will assume their positions with effect from February 1.
New members appointed are the company's Sarawak asset manager Wee Yiaw Hin, Shell Malaysia general manager for corporate affairs Wahiruddin Abdul Wahid, general counsel Sufian Shamsuddin and human resources director Jonathan Kohn.
Other members retained in the business council are Shell Malaysia Trading Sdn Bhd managing director Mohzani Abdul Wahab, Shell Malaysia's downstream gas and power business vice president Dick Benschop (who replaces Idris Jala, the former Shell MDS (Malaysia) managing director and now Malaysia Airlines managing director), Shell Malaysia finance director Michael Taylor and Shell Information Technology International Sdn Bhd country manager Steve Clearwater. read more

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Financial Times: S America problems hit Repsol

By Mark Mulligan in Madrid
Published: January 27 2006 02:00
Shares in Repsol YPF plunged nearly 8 per cent yesterday after the Spanish oil and gas group announced a 25 per cent cut in its proven reserves and warned of reduced profits this year.
The company partly blamed last year's increase in production royalties from 18 per cent to 50 per cent in Bolivia, where it was forced to write off 659m barrels of oil equivalent (boe) of gas – half of its total there. However, it also admitted that “new information” about gas deposits in Bolivia and Argentina had forced it to reassess the probability of extraction.
In Argentina, it said production difficulties and contractual uncertainties had led to a 20 per cent downward revision of its booked oil and gas reserves. As a proportion of total proven reserves, the Repsol downgrade eclipsed that of Shell, which two years ago admitted to overstating reserves by 20 per cent.
Although some downgrade in the troubled Southern Cone of South America was expected, analysts were surprised by the scale of the revision at Repsol. In a note, CSFB also raised the prospect of “further downgrades in Bolivian reserves”, referring to political uncertainty.
Repsol last revised down its proven reserves a year ago, when it announced a 4.1 per cent cut, to 4.93bn boe, because of problems in Trinidad and Tobago and in Argentina. That followed a radical revamp of the company, aimed at streamlining its unwieldy structure and decentralising its decision-making. The number of corporate and business divisions was halved.
Yesterday's move, which followed a year-long review of the company's reserves, was likely to add to uncertainty about Repsol's future.
With its stock market discount and troubled upstream business, the company has long been seen as a takeover target given its profitable refining and service station activities. However, its exposure to Latin America, which accounts for about 75 per cent of reserves, anddifficult shareholding structure acts as a deterrent.
Antonio Brufau, chief executive, said yesterday the company was confident of improving its poor reserve replacement rate, which was running at less than 20 per cent before the announcement. However, he warned that production levels would drop slightly, from 1.3m to 1.18m barrels a day by 2009, and that “between €160m and €170m” would be wiped off net profits this year.
However, the discounted book value of its Argentine and Bolivian gas reserves meant the write-down on assets would be contained at “less than €50m”.
The company has frozen €400m of planned investment in Bolivia pending talks with the administration of Evo Morales, the new socialist president.
The shares, which were suspended until early afternoon, closed down 7.7 per cent at €22.88. read more

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Financial Times: Shell-Mex House on market for £520m

By Jim Pickard, Property Correspondent
Published: January 27 2006 02:00
Robert and Vincent Tchenguiz, the property investors, are poised to put one of London's most prominent landmarks on the market at an estimated asking price of £520m.
Shell-Mex House, an Art Deco building next to the Savoy hotel on the Strand, was bought by Rotch, the Tchenguiz brothers' company, and entrepreneur Jack Dellal for £327.5m in early 2002.
The purchase, from Lehman Brothers and Steven Witkoff, the New York property developer, was at the time the biggest single investment in a UK building.
Nearly four years later, in one of the hottest commercial property markets ever seen in London, the building is likely to attract bids well over half a billion pounds.
The 575,000 sq ft building is occupied by Pearson, the owner of the FT, Vodafone, Omnicom and Shell. It generates annual rent of £25.5m. An offer of £520m would imply a gross initial yield of about 4.9 per cent.
It is understood that the building, which looms large over the Thames, will be marketed by CB Richard Ellis and DTZ, the property agents.
The 13-storey building, with a central clock tower, started life in 1886 as the Cecil Hotel, then the largest hotel in Europe, and was bought by Shell Mex in 1930.
The Tchenguiz brothers, along with rivals Ian and Richard Livingstone, are close to selling a £400m portfolio of Shell garages.
It is understood that the 180 petrol stations will be bought by the Englander Group, a north London family trust, on a net initial yield of 6.5 per cent.
The obscure group beat off competition from the likes of Golfrate and Reit Asset Management to buy the garages, which have Shell leases until 2017.
The Livingstones and Tchenguiz brothers bought the stations in 2000 for £300m. read more

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IrelandOn-Line: Opponents of Corrib gas pipeline mount Dáil protest

Opponents of the Corrib gas pipeline in north Co Mayo have mounted a demonstration outside the Dáil today to protest at the latest activities of Shell.
The global oil firm, which is behind the contentious Corrib project, has sent a high-level delegation from its “social responsibility committee” to the area to listen to the views of local residents.
The Shell to Sea group has refused to meet the delegation, however, and is accusing the company of acting outside the official mediation process being led by former union official Peter Cassels.
Speaking at today's Dáil protest, spokesman Tadhg McGrath claimed Shell was trying to soften up public opinion in advance of recommencing work on the pipeline.
“We've heard that Shell have block-booked accommodation in the west of Ireland to put up their vast army of security personnel and construction workers that they're going to use to put the scheme in place,” he said. read more

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The Scotsman: Shell may make swaps,acquisitions up to $10 bln

By Simon Webb
DAVOS (Reuters) – The chief executive of Royal Dutch Shell said on Thursday the oil company would consider making acquisitions or swaps worth up to $10 billion (5.6 billion pounds) to increase reserves.
“Even in times of high oil prices, it's possible, but not sure, that you may do small acquisitions or swaps of up to $10 billion,” Jeroen van der Veer told Reuters in an interview on the sidelines of the World Economic Forum.
Acquisitions or swaps of that magnitude could create value for shareholders of Shell, he said, but declined to comment on what possibilities the company might be pursuing.
Any larger acquisitions would be “very unlikely to work”, the Shell chief said.
Shell, the world's third largest listed oil firm by market value, is still living down a reserves scandal that shocked investors in 2004. The revelation that its oil and gas reserves were massively overstated sent Shell's shares tumbling.
Turning to Nigeria, where Shell ranks as the biggest foreign producer, van der Veer said his first concern was for the safety of four oil workers held hostage by militants.
A five-week campaign of sabotage and kidnapping by the Movement for the Emancipation of the Niger Delta has pushed world oil prices to four-month highs and shut in 221,000 barrels per day of Shell's output in Nigeria.
“I expect the government would like to sit down with (the oil) industry and talk about what can happen on security and keeping the oil flowing,” said the Shell chief.
The movement said it would make Shell suffer unless it paid $1.5 billion to delta villages in compensation for decades of oil pollution, which is one of its demands for releasing the hostages.
Van der Veer said repairs could not start on damaged oil infrastructure until discussions about ensuring security in the OPEC producer had taken place.
“When the situation is safe again, then you can restart production very quickly,” he said.
UNCONVENTIONAL
Van der Veer said Shell remained committed to increasing output of oil from unconventional deposits despite project cost overruns at its 155,000 barrels per day (bpd) Canada Athabasca oil sands project and a string of unplanned outages.
Shell has started a study for an oil shales project in Colorado, he said. It will test technology for heating oil underground there.
It is also looking at oil deposits in ever-deeper water, and analysing deposits of tight gas, or gas left in reservoirs after conventional drilling, he said.
Van der Veer said he was not concerned that increased exposure to unconventionals could erode Shell's profitability.
“On the contrary, I think we can build a very good company on unconventional oils. If we have technologies that allow us access to oil that nobody else has, then we have a very competitive position. That puts the company in a stronger position for the long-term.”
Van der Veer said that Shell's access to easy-to-exploit oil reserves was limited and its production has peaked, while there were still plenty of unconventional oil sources to be exploited.
He said that the ouptut from its 147,000 bpd Mars platform in the Gulf of Mexico should restart in the second half of 2006, as the company has previously stated. The platform was damaged by Hurricane Katrina last summer.
(c) Reuters 2006. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world. read more

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Dow Jones News: Shell Malaysia Names New Council Leaders

Thursday January 26, 2006, 7:27 pm
PRESS RELEASE: Shell Malaysia Names New Council Leaders
The following is a press release from Shell Malaysia:
Shell Malaysia today announced a revision of its Business Council leaders for the company's ongoing activities in Malaysia.
The Business Council is Shell Malaysia's highest coordinating body. New members will assume their positions with effect from Feb. 1, 2006.
The Shell Malaysia Business Council comprises the chairman, leaders of the company's key business portfolios in Exploration and Production, Downstream Gas, Downstream Oil, the finance director and senior managers in Human Resources, IT, Legal and External Affairs.
Datuk Jon Chadwick will chair the Business Council until March 1, 2006, at which time he will be replaced by Mr. Saw Choo Boon, who will, as previously announced, be Shell Malaysia's new chairman with effect from the same date.
Saw is the third Malaysian to lead Shell Malaysia's Business Council.
As Shell Malaysia's Chairman, Saw will lead the Business Council in shaping the company for greater growth in Malaysia.
Additionally, he will retain his current Downstream Oil responsibilities as well as serve as chairman of the boards of several companies where Shell Malaysia has business interests.
Mr. Wee Yiaw Hin, the company's Sarawak Asset Manager, will be appointed managing director of Sarawak Shell Berhad and a Business Council member.
Wee is Shell Malaysia's Local Senior Exploration and Production Representative; Wee is Malaysian and he will continue to be based in Miri, Sarawak.
Encik Mohzani Abdul Wahab is already a member of the Shell Malaysia Business Council in his capacity as Managing Director of Shell Malaysia Trading Sdn Bhd and Shell Timur Sdn Bhd in addition to his current role as General Manager for Shell's Retail Sales and Operations in Malaysia, Singapore, Brunei and Oman.
Mohzani is Malaysian and also holds the position of Shell Malaysia's Local Senior Downstream Representative, based in Kuala Lumpur.
Lt. Colonel (Rtd) Ir Wahiruddin Abdul Wahid is Shell Malaysia's General Manager for Corporate Affairs.
Newly appointed to the Business Council, he is also Shell Malaysia's Country Security Adviser. Wahiruddin is Malaysian and is based in Kuala Lumpur.
Encik Suflan Shamsuddin is Shell Malaysia's General Counsel. A Malaysian, Suflan is also company secretary to several Shell Malaysia companies and is based in Kuala Lumpur. Suflan is newly appointed to the Business Council.
Mr. Dick Benschop was recently appointed Vice President of Shell Malaysia's Downstream Gas and Power business, as well as Managing Director of Shell MDS (Malaysia) with effect from 1st December 2005.
Benschop, a Dutch national, is based in Kuala Lumpur and replaced Mr. Idris Jala, who is now Managing Director of Malaysia Airlines.
Mr. Michael Taylor is already a member of the Shell Malaysia Business Council in his capacity as Finance Director of Shell Malaysia and Shell's Exploration and Production Finance Manager for Asia Pacific. Taylor is a British national and is based in Miri, Sarawak.
Mr. Steve Clearwater already sits in the Shell Malaysia Business Council as the Executive Director and Country Manager of Shell Information Technology International Sdn Bhd. Clearwater is a New Zealander and is based in Cyberjaya.
Mr. Jonathan Kohn, a British national, was recently appointed as Shell Malaysia's Human Resource Director. Kohn is newly-appointed to the Business Council and is based in Kuala Lumpur.
Additionally, Shell Malaysia today confirms that Encik Zainul Rahim Mohd Zain, formerly Deputy Chairman of Shell Malaysia, has been assigned to Cairo as Chairman of Shell Egypt. read more

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The Daily Advertiser (Louisiana): Activists organize against Shell

Kayla Gagnet
[email protected]
Activists are hoping a grassroots campaign of e-mails, phone calls and letters to newspaper editors will make oil and gas giant Shell reconsider its plans to build an open-loop liquefied natural gas terminal off the coast of Cameron Parish.
Dan Favre, an organizer with the Gulf Restoration Network, met Wednesday night with student environmentalists at the University of Louisiana and then later with members of the local Sierra Club.
Favre said now is a “crucial time” in the battle against the controversial open-loop terminals, which use 100 million to 200 million gallons of sea water a day to warm and “re-gasify” liquefied natural gas so it can be shipped to American energy users.
“They're going to set a precedent for the whole Gulf,” Favre said.
At stake, he said, is irreparable damage to the Gulf of Mexico's fisheries. Environmental studies show the cold water that the open loop system pumps back into the Gulf would kill 5.3 percent of the red fish population and have an unknown effect on shrimp, crabs, grouper and other fish.
So far, only one open-loop terminal is operating in the Louisiana Gulf – the Excelerate Energy Bridge, far offshore and less damaging to sea life, Favre said. An application for an ExxonMobil terminal has been withdrawn, and there are six other terminals that either are proposed or pending, including the Shell site.
Shell has received government clearance to build its open-loop terminal at Gulf Landing, about 38 nautical miles off the Louisiana coast, south of Lake Charles. But, the Gulf Restoration Network and other commercial and recreational fishing groups want Shell to consider switching to the environmentally friendly closed-loop system.
Oil and gas companies transport natural gas in liquid form, cooled to minus 260 degrees, because it takes up 600 times less space than the gas form. When it arrives at terminals, it has to be warmed up so it can be transported in pipelines. A closed-loop system could use two different processes, Favre said.
One involves recycling the same water, keeping it warm by using 1.5 percent to 2 percent of the natural gas. Another involves using the ambient air temperature to warm the gas. Oil companies say both are too expensive.
Griff Blakewood, an environmental and sustainable resources instructor at UL, said he's hopeful that Shell will reconsider.
“At some point, we just have to start caring about the life of the planet,” Blakewood said.
Blakewood and student members of the Society for Peace, Environment, Action and Knowledge organized plans to write letters to area newspapers. They also made plans to call Shell executives next week on a designated “call-in” day, in an attempt to flood the company with complaints about the project.
“This is new to me,” SPEAK member E. “Ski” Witkovski, 26, said of the LNG terminals. “And it's really scary.” read more

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Calgary Sun: Shell hits new high$

Energy giant tops $2B in profit thanks to high prices, oilsands
By IAN WILSON, BUSINESS EDITOR
Shell Canada CEO Clive Mather said his firm's 2005 earnings of more than $2-billion were “tremendous.”
High energy prices and strong output from the oilsands helped push Shell Canada Ltd.'s profit and production to record levels last year, with earnings topping $2 billion.
The annual financial figures, released by Shell Canada yesterday, were up significantly from the company's 2004 profit of $1.3 billion and fourth-quarter earnings tripled from the previous year to $614 million.
“Breaking through the $2-billion barrier was a tremendous achievement,” said the Calgary-based company's president and CEO Clive Mather.
“Shell Canada ach-ieved record production in 2005, which enabled it to take advantage of strong commodity prices and deliver record earnings and cash flow.”
The energy firm's cash flow last year was up 40% from 2004, eclipsing $3 billion, and record-smashing activity also occurred at Shell Canada's Athabasca Oil Sands Project.
New highs for output and energy prices, along with lower costs associated with producing each barrel of crude, allowed the company to double 2005 oilsands earnings.
In the fourth quarter, Shell Canada — a subsidiary of Royal Dutch Shell PLC — also increased investment in that area with the acquisition of three more Athabasca oilsands leases, bringing the total number of leases bought by the company through Crown land sales to seven in 2005.
Meanwhile, Canadian Oil Sands Trust reaped the benefits of unhedged oil production.
“Our excellent financial results in 2005, including over $1 billion in cash flow, reflect our full exposure to robust crude oil prices,” said president and CEO Marcel Coutu.
“Fundamentals point to continued strength in crude oil prices and Canadian Oil Sands Trust is in an enviable position to benefit from this market. All of our light, sweet crude oil production remains unhedged.”
Fourth-quarter net income for the trust was $174 million last year, up from $122 million in 2004. And for the year, earnings rose from $509 million in 2004 to $831 million.
The company — which generates income from its 35% working interest in Syncrude — also reported the $8.4-billion Stage 3 expansion at the joint venture is almost complete and on schedule for a mid-2006 start-up. read more

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The Times: Lukoil find 'biggest for decade'

By Carl Mortished, International Business Editor
A MAJOR discovery by Lukoil in the Caspian Sea could help to propel the Russian oil company to the top spot in private sector oil and gas reserves, ahead of ExxonMobil, the present leader.
Lukoil said that an oil and gas discovery in the northern Caspian Sea was the largest Russian find in a decade, containing oil reserves of 600 million barrels and 1.2 trillion cubic feet of gas. The company also revealed yesterday that it had paid $261 million (£146 million) for Primorieneftegaz, a company that holds a licence near Astrakhan.
Together, the two assets could add 3.3 billion barrels to Lukoil’s reserves, which currently stand at 20 billion barrels of proven oil and equivalent gas. At the end of 2004, ExxonMobil reported 22 billion barrels of oil and gas reserves.
Lukoil said that an exploration well at the Vladimir Filanovsky field had produced light, water-free low-sulphur oil at the rate of 800 tonnes per day. “Such flow rates in Russia are only known at a few wells. The average flow rate in Russia is 10.5 tonnes per day,” the company said.
Primorieneftegaz has reserves of 1.2 trillion cubic metres of gas and 300 million tonnes of condensate in a licence near the Russian town of Astrakhan.
Soaring oil and gas prices are pushing up the market value of Russia’s energy companies, which boast huge untapped reserves.
The stock market value of Gazprom, the state-controlled utility, has soared above $200 billion, competing with Royal Dutch Shell for the number three slot among quoted energy companies. read more

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The Times: Nigeria in contact with oil worker kidnappers

From Agencies in Davos
President Olusegun Obasanjo of Nigeria today said that his government was in contact with kidnappers who are holding four foreign oil workers, including one Briton, captive in the country.
Mr Obasanjo told Reuters at the World Economic Forum in Davos that the authorities were “very much in contact” with the militant group that seized the oil workers on January 11.
He added: “Immediately after it happened, we set up a committee … It’s not only in contact, it’s making progress.”
Asked if he was concerned about the impact on oil investment, Obasanjo told Reuters at the World Economic Forum in Switzerland: “Not really.”
Last week, Nigel Watson-Clark, from Bristol, who is being held hostage with three other foreign oil workers by separatist rebels in western Nigeria made a second desperate telephone plea for help today as his captors again threatened their execution.
In the chilling phone call to Reuters, Mr Watson-Clark said: “I have got to tell you we are under a lot of pressure here and things aren’t too good.
“We are being moved around continuously… we are not being treated that great… we are not used to this sort of stuff.”
Mr Watson-Clark was kidnapped with an American, a Honduran and a Bulgarian when armed rebels from the indigenous Ijaw tribe attacked an offshore oil platform in the Niger Delta owned by Royal Dutch Shell.
The kidnappers, from the Movement for the Emancipation of the Niger Delta (MEND), have demanded greater control over the poverty-stricken region's energy wealth and the release of two tribal leaders.
The first 48-hour deadline was issued on Tuesday. Today, a man describing himself as the outfit's ground commander claimed that Patrick Landry, the American hostage, was seriously ill. He said that the others would be killed if he died.
In a phone call broadcast on Sky News, he said: “One of them is sick, badly sick and could give up tonight. If one of them dies, we kill them all.” read more

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The Times: Need to Know: Royal Dutch Shell has made two new oil and gas discoveries…

Antofagasta, the FTSE 100 copper miner, said that production from October to December had risen 7 per cent quarter on quarter to meet full-year forecasts.
Shares in Victoria Oil & Gas, the AIM-listed company, rose after an independent audit of its Russian project in west Siberia found that it had 1.1 billion barrels of oil equivalent, more than previous estimates.
Royal Dutch Shell has made two new oil and gas discoveries in its Badr El-Din concession in Egypt’s Western Desert.

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AP Worldstream: Shell, Petrobras pay off back taxes to Venezuela

Oil companies Royal Dutch Shell PLC and Brazil's Petrobras have paid a total of US$37 million (A30 million) in back-tax claims to the Venezuelan government, the tax agency said in statement late Tuesday.
Shell owed US$13 million (A10.6 million) in taxes, while Petrobras, a state-owned company known as Petroleo Brasileiro SA, owed US$23.7 million (A19.3 million).
The bills came last year after the tax agency conducted an audit of private companies operating oil fields under contract to reclaim what it says were billions of dollars (euros) in unpaid taxes. Twenty other oil firms have been billed for back taxes.
President Hugo Chavez's administration has taken advantage of high oil prices to pressure the petroleum industry for a greater share of revenues. It has used extra oil income to fund social programs, as well as strengthen alliances with other countries.
Separately Tuesday, an official from El Salvador's main left-wing party, the Farabundo Marti National Liberation Front, or FMLN, said a delegation was lobbying for 21,000 gallons (79,500 liters) a month of diesel and gasoline under Venezuela's Petrocaribe initiative, which provides oil through cheap financing and partial payments with agricultural exports.
The fuel would be sold to municipalities governed by the FMLN and other parties that sign up for the program, said Orestes Fredesman Ortez, a national coordinator for the FMLN.
El Salvador's conservative government of Tony Saca has previously rejected a Petrocaribe deal, saying it would violate free trade agreements with the U.S.
Venezuela is the world's fifth-largest oil exporter and holds the largest conventional oil reserves outside of the Mideast. read more

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Polish News Bulletin: Shell Plans to Locate Financial- -Accounting Centre in Cracow

One of the world's largest petrol companies, the Royal Dutch Shell group, is planning to locate its fifth international financial-accounting centre in Cracow.
The spokesman of Shell Polska Alfred Kubczak announced that the enterprise is currently awaiting a decision from the Polish Information and Foreign Investment Agency (PAIIZ) concerning governmental co-financing in creating new jobs. According to Kubczak the decision will be crucial to the fate of the project.
“If it is positive, we will immediately begin the preparations for locating the investment in Cracow. Then we will also know the precise level of employment in the centre,” said Kubczak. Preliminary estimates indicate that the centre is to employ a few hundred professionals from the financial and accounting branches.
During the 10 years of its presence in Poland, Shell has invested over $400m and given jobs to around 3,000 people. Its petrol station network comprises about 220 entities. read more

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Lloyds List: Saudi Arabia agrees to lift production

Bid to curb price rises while it continues investment, writes Martyn Wingrove
Jan 26, 2006
SAUDI Arabia has pledged to raise its oil production levels if required and continue supplying Asia with its crude requirements.
The world's top oil producer is ready to keep its oil taps flowing to prevent prices from climbing further while it continues to invest in existing fields to raise production capacity.
At the Organisation of Petroleum Exporting Countries ministerial meeting next week Saudi officials will also urge fellow members to keep production quotas level.
Saudi King Abdullah and his delegation of ministers and business leaders are this week visiting four Asian countries, including booming energy consumers India and China, to improve diplomatic agreements.
The kingdom is creating new trade links with Asian countries which are increasingly reliant on crude imports from the Middle East.
King Abdullah said his country was committed to supplying Indian and Chinese energy needs and that oil prices were too high, damaging the economy of developing countries.
'We have the ability and capability to provide all the energy needs of India and other countries,' he said in a television interview in New Delhi.
'Saudi Arabia's oil reserves will be there for the long term for every one.
'A large portion of the country has not been explored as yet.'
Saudi Oil Minister Ali al-Naimi added: 'Fundamentals today are in excellent shape and inventories are at reasonable levels. Oil supply is plentiful and demand is well met by supply.'
Mr al-Naimi also said his country was ready to pro- duce more oil if needed and added that Opec was likely to keep output steady when it meets on January 31 in Vienna.
Saudi Arabia is investing in several of its oilfields, including the world's largest offshore field, to make sure it has the ability to supply global demand increases for many more decades.
But much of the new capacity it is building is in heavy, sour crudes, less attractive to refiners.
Opec, which produces around 28m-29m barrels of oil a day, has plenty to think about at this meeting as it wants to keep oil prices high and continue to meet global demand.
Iran is the leading voice within the cartel, calling for production cuts in the second quarter when global demand begins to fall for seasonal reasons, but there will be resistance from Saudi Arabia.
Analysts at the Centre of Global Energy Studies in London think the cartel will choose to maintain production levels during the second quarter.
'The oil market has tightened over the past week, reducing the pressure on Opec to make an early output cut to support prices,' the centre said in its latest monthly report.
'A combination of cold weather, a slow recovery in non-Opec output and a reduction in Opec's own oil supplies, have tightened the supply-demand balance.'
Fears of output disruption in Opec members Iran and Nigeria have been a prime factor in pushing up oil prices this month.
Iranian officials have threatened to use its oil exports as a weapon if Western powers get in the way of its nuclear research and development programme.
Nigeria exports are down by 220,000 barrels a day due to tribal unrest in the Niger delta.
Royal Dutch Shell has called force majeure on its exports through the Forcados and EA terminals in the country after attacks on the Trans Ramos pipeline and offshore installations.
This has been partly offset by rising deepwater oil production from the Bonga field, which is pumping out 150,000 barrels a day.
On the positive side, Iraqi exports are rising with higher volumes coming from the Middle East Gulf terminal at Basra and the reopening of an export pipeline from northern Iraq to Ceyhan in Turkey.
Higher oil prices have obviated the need for Opec to contemplate production cuts and have led to Saudi Arabia's reassurances on supply.
This week, US oil prices rose to $67 a barrel and London's benchmark Brent was trading around $65 because of geopolitical tensions and production outages.
Traders will be eagerly waiting to see how Opec's meeting next week goes, but most think the status quo will be kept. read more

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Irish Independent:Anti-pipeline alliance spurns visiting Shell delegation

By Tom Shiel
Jan 26, 2006
LANDOWNERS opposed to the onshore Corrib gas pipeline in Co Mayo yesterday snubbed a top-level delegation from energy giant Shell who travelled to the area on a fact-finding mission.
Three non-executive directors of Royal Dutch Shell plc, including Wim Kok, a former prime minister of the Netherlands, went to the Rossport and Bellanaboy area where it is proposed that gas from the Corrib Field will be brought ashore and processed.
Accompanying Mr Kok were Nina Henderson and Maarten van den Bergh. They were joined on the trip by Tom Botts, executive vice-president for Shell's European Exploration & Production business.
The three are members of Shell's Social Responsibility Committee (SRC), a committee established in 1997 to review the policies and conduct of the company in relation to its commitment around Business Principles and Health, Safety and Environment.
In this capacity they frequently visit Shell projects around the world to listen to local communities and to try to understand the impact that such projects have on the communities, customers, employees and the shareholders.
During their Mayo visit the directors met with local political representatives, resident groups, consenting landowners and other interested parties to listen to their views on and concerns about the Corrib pipeline project.
In a statement yesterday, Shell expressed disappointment that an invitation to the non-consenting landowners to meet with the board members was declined and hopes that a dialogue at a later date will be possible.
“Together with my colleagues on the board of Royal Dutch I frequently visit Shell projects around the world, as an independent observer,”
“We, the board members, are independent and are interested in how the project touches communities, employees and shareholders and in understanding the difficulties and challenges around the Corrib project from a local perspective,” said Mr Kok.
Shell said the meeting was completely independent from the ongoing mediation process that the company is continuing to participate in. read more

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Irish Times: Cassells opens mediation talks on gas pipeline

Lorna Siggins, Marine Correspondent, and Liamy MacNally
Jan 26, 2006
The first formal mediation talks involving the five men jailed last year over their opposition to the Corrib gas onshore pipeline took place in north Mayo yesterday, just as a high-level Royal Dutch Shell delegation visited the area.
The men told the company it would be premature to meet the delegation during mediation talks, chaired by former Ictu secretary-general Peter Cassells.
Since his appointment in late October last year by Minister for the Marine Noel Dempsey, Mr Cassells has held informal discussions in north Mayo. However, last night the Rossport Five expressed serious concern about remarks Mr Dempsey made in the Dail yesterday.
The Minister told Labour marine and energy spokesman Tommy Broughan that he expected mediation to be completed “in the spring, over the next month or so”.
A spokesman for the five men said no deadline had been agreed with Mr Cassells, who, they believed in good faith, had been appointed by the Minister as an “independent” broker.
A spokeswoman for the Minister said that he had incorrectly referred to a month in the Dail and he believed mediation would take “a matter of months”.
The Royal Dutch Shell delegation, led by former Dutch prime-minister Wim Kok, met local politicians and residents in Belmullet yesterday and in Cornboy last night.
But Shell confirmed that written invitations had only been issued to “consenting” as distinct from “non-consenting landowners” living on the high pressure pipeline route.
Two opponents who asked to meet the delegation in a personal capacity in Belmullet yesterday were ushered out of the hotel grounds by security staff.
Dr Mark Garavan of the Shell to Sea campaign said this confirmed that the Shell visit was a “complete PR” exercise. This was denied by the company.
Shell said that “verbal invitations” to meet the delegation had been issued to the five men and to “non-consenting landowners” through an “independent third party”.
Travelling with Mr Kok are Nina Henderson, former president of US food company Bestfoods, and Maarten van den Bergh, a managing director with Shell since 1992, chairman of the board of directors of Lloyds TSB group and non-executive director of BT group and British Airways plc.
All three are non-executive board members and serve on the company's social responsibility committee, which also visited the controversial Shell project at Sakhalin island in Russia last year.
They were accompanied by Tom Botts, executive vice-president for Shell's European exploration and production business.
In a statement, Mr Kok said that the project was “very important” for “Mayo, for Ireland and for Shell”, but “it can only succeed in partnership with the local community”.
Independent Mayo TD Dr Jerry Cowley said he would tell the delegation in Dublin today that the pipeline could not go ahead as planned, due to serious safety concerns, and the company must opt for an offshore terminal.
“This is the company that jailed five Mayo men over their genuine safety fears, and I will inform the delegation that the jails of Ireland won't be big enough to hold objectors if they proceed against the people's will,” Dr Cowley told The Irish Times .
Constituency colleague Beverley Flynn (Ind) has called on towns “across the State” to “stake their claim” for a connection to the pipeline. read more

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The New York Times: Delta Villages Fear Troops in Nigeria

By REUTERS
Published: January 26, 2006
WARRI, Nigeria, Jan. 25 (Reuters) — Villagers fled Nigeria's lawless delta on Wednesday amid fears of military reprisals after a wave of attacks on foreign oil companies by ethnic Ijaw militiamen.
The army deployed more troops to major installations, and oil companies tightened security around offices a day after heavily armed men stormed the headquarters of the Italian oil firm Agip, robbing a bank on the premises and killing eight policemen and a civilian.
“There are soldiers everywhere, and I don't want my three girls in the firing line,” said Return Powei, who lives in the remote village of Ogbotobo. “Our youths run into the forest when they hear the soldiers are coming. Everyone is moving out of Ogbotobo.”
It was not clear if the attack on Agip, a unit of ENI of Italy, was the work of the Movement for the Emancipation of the Niger Delta, whose five-week campaign of sabotage and kidnapping has contributed to an increase in oil prices.
The group said it would make Royal Dutch Shell suffer unless it paid $1.5 billion to delta villages in compensation for decades of oil pollution, which is one of its demands for releasing four foreign hostages.
The government has set up a committee to negotiate the release of four oil workers kidnapped Jan. 11. read more

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Business Times: Companies can find oil, but at a cost: Shell CEO

Business Times (Malaysia)
LONDON, Wed: World energy companies have plenty of remaining sources to tap for oil, natural gas and other fuels, yet tapping them will take big investments, Jeroen van der Veer, the chief executive officer of Royal Dutch Shell plc said today.
Writing in the Financial Times, van der Veer cited an International Energy Agency estimate that meeting global needs would take a US$17 trillion (US$1 = RM3.75) investment by 2030.
Companies are seeking to draw more oil out of existing reservoirs, the executive said. They will be drilling for natural gas, and trying to unlock more oil and gas from sand and shale, van der Veer said.
Coal gasification and other techniques can be used if problems of carbon dioxide emissions are minimised, the Shell official said.
The high levels of investment needed over the next few decades make government suggestions of levying windfall taxes “counterproductive” he said. – Bloomberg read more

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Canadian Press: Shell Canada posts $2 billion in profits for 2005

CALGARY — A lucrative earnings-report season for the Canadian oilpatch began Wednesday as Shell Canada Ltd. posted record annual profits of $2.01 billion, up 56 per cent over 2004 due to record energy prices and strong production growth in the oilsands.
Shell said it earned $614 million or 74 cents per share in the fourth quarter of 2005 — more than triple the $182 million, or 22 cents per share, it earned in the same period of 2004.
Chief executive Clive Mather said breaking through the $2-billion barrier in annual profits was a “tremendous achievement.''
The year's cash flow from operations was $3.06 billion, a boost of more than 40 per cent from the previous year.
The company's revenues soared by nearly $1 billion in the fourth quarter alone to $4.04 billion. Full year revenues were $14.4 billion, compared with $11.3 billion in 2004.
Shell Canada, 78 per cent owned by British-Dutch multinational Royal Dutch/Shell Group, is one of Canada's major integrated oil companies with 4,000 employees in oilsands operations near Fort McMurray, Alta., natural gas production in Western Canada and off the East Coast, refineries and a chain of gasoline stations.
“We've got a full slate of projects right across the board,'' Mather said in an interview.
Last November, Shell announced plans to boost capital spending in 2006 by 60 per cent to $2.7 billion in order to develop its oilsands and natural gas operations.
And it expects to spend upwards of $17 billion over the next five years — with the lion's share going to oilsands expansions.
While record oil and natural gas prices were key to 2005's record profits, the company also set production records at its Athabasca oilsands mine and upgrader, in which it owns a 60 per cent operating stake.
For the full year, the Athabasca project averaged 159,900 daily barrels of bitumen, nearly 5,000 barrels above its design capacity. Fourth-quarter production was even higher at 178,000 barrels per day and the company's Scotford upgrader on the outskirts of Edmonton also achieved production records.
Energy analyst Wilf Gobert with Peters & Co. in Calgary said the extra oilsands production enabled Shell to post better than expected results.
Gobert said he expects the company to use the extra cash to continue expanding its heavy oil production.
“They've got a pretty ambitious plan for the expansion of oilsands production.''
Last year, Shell announced that its first major expansion at Athabasca would cost about $7.3 billion, nearly twice as much as initially expected. Mather said Wednesday that the company will make a decision on whether to go ahead with the expansion later this year.
The expansion would provide an extra 100,000 barrels per day of production, along with intentional “over-building'' of infrastructure to make further expansions cheaper and easier.
Shell's partners in Athabasca are Chevron Canada and Western Oil Sands (TSX:WTO), each holding 20 per cent.
Mather said Shell is interested in boosting its oilsands presence further.
“Of course we'd love to have more oilsands exposure if we could get it, but at a price that offers value, and therein lies the challenge.''
One of the only declining businesses for Shell was its downstream oil products division, which reported annual earnings of $438 million, down from 2004's record earnings of $451 million.
Strong refining margins and improved light oil yields were offset by lower refinery utilization and higher expenses.
Although the North American gasoline market was marked by hurricane-induced supply disruptions and fuel price volatility last fall, Shell said it was “able to maintain a reliable supply to customers at competitive prices throughout.''
Shell Canada shares declined 93 cents, or two per cent, to $44.32 during the down day for energy issues on the Toronto Stock Exchange. read more

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Financial Times: Mudlark: Traynor finds voice at Shell

JJ Traynor is completing his transformation from poacher to gamekeeper, writes Clay Harris. The former top-ranking oil and gas analyst at Deutsche Bank is to become the new head of investor relations at Royal Dutch Shell, one of the companies he used to test, occasionally torment, with searching questions.
Traynor joined Shell’s new business development group last year after Deutsche Bank dispensed with his services as part of the closure of its Edinburgh office. His new job is part of a crew change at Shell.
He replaces David Lawrence, who is moving from investor relations to become head of exploration, a more logical choice than it might sound since he is a geologist with long experience in exploration and development.
Lawrence, for his part, succeeds Matthias Bichsell, who takes over as head of exploration and production technical when John Darley retires in May. read more

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Accountancy Age: Shell fiasco haunts Boynton

On the frontline: lawsuit over reserves error could delay comeback for Judy Boynton
Paul Grant
Around this time last year, we posed the question of whether executives tarnished by corporate scandal, such as former Shell CFO Judy Boynton, would be able to shrug off the problems of the past and reclaim another top job.
Twelve months on and the answer, for Boynton at least, seems to be a resounding ‘no’.
Not only has Boynton disappeared from the corporate radar, but the problems of the past have come back to haunt her in the form of a lawsuit.
A group of 26 Dutch pension funds – led by £11.5bn civil servant fund ABP – is suing Shell, Boynton, four other Shell directors and joint auditors PricewaterhouseCoopers and KPMG over the oil reserves scandal that cost Boynton her job.
APB’s claim is worth $150m (£84.9m), but the total value adding in the other claims could run much higher.
The pension funds argue that, because reserve levels were allegedly reported falsely, it paid inflated prices for Shell stock. Boynton, as the person responsible for preparing financial statements and internal controls, falsely certified Shell’s annual report and SEC filing the funds’ claim.
Should anything come of the action, the £1.5m severance package that Boynton walked off with, to much outrage from spectators, could suddenly seem like a drop in the ocean.
It is nearly two years since Boynton was forced to step down from her role at Shell after the Anglo/Dutch group was found to have overstated its proven oil and gas reserves by 20%.
An independent report into the scandal at the time found that the compliance role of the finance function ‘was not effective’ on the reserves, and although Boynton was responsible for ensuring that financial disclosures to the market and regulators were correct, she took ‘virtually no action’ to check the facts behind the figures.
Instead, she relied on Shell’s existing ‘checks and balances’, and was ‘reassured’ that its exploration and production department was ‘focused on issues’. This was not enough to safeguard her job. Boynton swiftly left Shell, £1.5m in pocket, and has yet to resurface.
Boynton had been the first female to join Shell’s board. Previously she had served as chief financial officer and executive vice-president of business development for camera group Polaroid in Massachusetts. Before that she had served at another oil group, Amoco, in a variety of finance, strategy and M &A roles in its upstream, downstream and chemicals businesses.
Now her exile from the public limelight, whether self-imposed or otherwise, looks like it will have to come to an end in order to fight this litigation. And while a court case could be very damaging for the former director, it may well provide the opportunity for her to put her side of the story forward and help restore some of the shine to her once brilliant reputation. read more

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Reuters: Shell Canada profit triples on surging oil prices

Wed Jan 25, 2006 12:21 PM ET
CALGARY, Alberta, Jan 25 (Reuters) – Shell Canada Ltd.'s (SHC.TO: Quote, Profile, Research) fourth-quarter profit more than tripled as the country's No. 3 oil producer and refiner benefited from surging oil and gas prices as well as rich refining returns, it said on Wednesday.
Shell Canada, which is majority-owned by oil major Royal Dutch Shell Plc (RDSa.L: Quote, Profile, Research), earned C$614 million ($534 million), or 74 Canadian cents a share, up from year-earlier C$182 million, or 22 Canadian cents a share.
The company is the first among major Canadian energy firms to report results for a fourth-quarter widely expected to set records due to unprecedented commodity prices.
Cash flow, a glimpse into an oil company's ability to fund development, more than doubled to C$930 million from C$437 million. Revenues were C$4 billion, up from C$3.1 billion.
Shell, best known for its national gas station chain, said earnings were also driven by sharply higher volumes at its northern Alberta oil sands project.
Oil sands production in the quarter averaged 106,800 barrels a day net to Shell's 60 percent interest, up from year-earlier 65,900, when half the plant was down for repairs, it said.
Full-year profit rose to a company-record C$2 billion, or C$2.44 a share, up 50 percent from C$1.2 billion, or C$1.56 a share, in 2004.
Shell Canada shares were off 60 Canadian cents at C$44.65 on the Toronto Stock Exchange. Royal Dutch Shell owns 78 percent of its Canadian affiliate.
Early this year, in response to rampant market rumors, Shell Canada said it had no knowledge of a plan by its parent to buy out the minority stake.
($1=$1.15 Canadian) read more

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Urgent appeal to Royal Dutch Shell Plc Investors by U.S. Pirg Shell campaign regarding arctic national wildlife refuge

By Zack Brown
For the past seven years, the U.S. Public Interest Research Group (U.S. PIRG) Education Fund has led a broad coalition of environmental groups, financial organizations, investors, religious groups, students, activists and citizens in a campaign targeting oil companies that have expressed interest in drilling in the coastal plain of the Arctic National Wildlife Refuge.
The campaign has made progress with BP and ConocoPhillips, who have stopped lobbying in support of drilling in the Arctic Refuge, and have stated that drilling in the area is not a priority.
Our campaign continues to push Chevron and ExxonMobil on the Arctic, but in 2006 most of our attention will focus on Royal Dutch Shell. In March of 2005, Royal Dutch Shell bid $44 million for rights to explore for oil off the coast of the Arctic National Wildlife Refuge. With the acquisition of these leases, Royal Dutch Shell is now part of the contentious and controversial debate regarding the future of America’s Arctic.
Our organizations have repeatedly urged oil companies operating in Alaska to stay out of the Arctic Refuge and have often filed shareholder resolutions as part of this effort. We are currently working with concerned shareholders on the filing of a shareholder resolution for the Royal Dutch Shell 2006 annual meeting.
Our goal is to engage shareholders to call on Royal Dutch Shell to prepare a report on the negative impacts drilling in the Arctic Refuge would have on the environment, human rights of the Gwich’in and Inupiat peoples, and the company’s reputation. We believe that drilling in the Refuge would negatively affect the human rights of the Gwich’in and Inupiat peoples; cause irreparable harm to migratory birds, musk oxen, polar bears and the 130,000 member caribou herd; and negatively affect the company’s reputation for years to come.
As a part of our effort, we are building a large pool of individual Royal Dutch Shell common stock investors. If you, or anyone you know owns Royal Dutch Shell common stock (RDS-A or RDS-B) please contact Zack Brown at the U.S. Public Interest Research Group Education Fund prior to February 22nd at [email protected]
Zack Brown
Arctic Wilderness Associate
U.S. Public Interest Research Group
218 D Street, SE
Washington, DC 20003
202-546-9707 – 202-546-2461 fax read more

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AllAfrica.com: Oil Production in Danger, Shell Warns

Daily Champion (Lagos)
By Ebere Nwoji, Vincent Adekoye and Napoleon Ehiremen
Lagos/Benin/Warri
SHELL Petroleum Development Company (SPDC) has alerted that the oil status of the country could be severely affected by the resurgence of violence in the Niger Delta region.
The company raised this alarm just as the Federated Niger Delta Ijaw Communities (FNDIC) yesterday said they are ready to negotiate the release of the four expatriate oil workers kidnapped by militant youths at SPDC facility two weeks ago.
The communities said this was in accordance with the mandate given to them by President Obasanjo to secure the release of the kidnapped oil workers.
Skirmishes in the region recently assumed frightening dimension. Penultimate Sunday about 14 people were feared killed when armed militants attacked SPDC's Benisede flow-station, burnt down two staff lodgings and damaged processing facilities.
SPDC acting External Relations Manager, Chief Charles Akeni, however, said that the raging crisis in the region is threatening the operations of the company on daily basis, thereby diverting its attention from other commitments that would have improved the nation's oil production capacity.
Akeni stated this while delivering a lecture on the operations of the company and problems confronting it, at a workshop organised for journalists in Asaba and Benin, Delta and Edo states respectively.
He identified some of the threats to include bunkering, (crude oil theft) pipeline vandalization which he said has assumed a fearful dimension of recent, threat by the Ijaw National Youth Congress and other militant groups across the country which often comes in form of invasion of flow stations, lock-outs, vehicles seizures, disruption of oil operations, hostage taking and kidnapping.
Others are arms build up in the Niger Delta and Supreme Court decision on the controversial resource control matter.
Chief Akeni observed that while other oil producing nations of the World are busy carrying out research on how they could improve their oil production, Nigeria is busy negotiating release of innocent oil workers abducted by some unknown militant youths on their work place.
While calling on stakeholders to appreciate the gestures of the SPDC which he said has taken the issue of the community relations seriously than any other oil producing company in the country, he disclosed that Shell has set up a functional department that is headed by a senior manager, to review the local content policy of the company with a view to making it more virile if need be. According to him, this will address some of the agitations relating to issues of employment and award of contracts to indigenous contractors.
He reiterated the policy of the company in support of the extractive transparency in the revenue generated by the extractive industries and called on the federal government to implement same to the letter.
On January 11, four expatriate workers of Tidex Drilling Company Limited, a corporate contractor to SPDC were kidnapped and their captors had earlier ruled out their immediate release despite pressure from government.
But in a statement signed by Hon. Bello Oboko, and Chief Government Ekpemupolo, president and director of mobilization respectively, it was stated that President Obasanjo had mandated them to negotiate and secure the release of the oil workers.
According to the statement, “Following increasing pressures from presidency officials and a direct instruction of Mr. President, in a telephone conversation relayed on January 18, 2006 mandating FNDIC to act as chief negotiators, we (FNDIC) obliged to accept the weighty responsibility”.
It stated that their readiness to take up the task was because of the gravity of the consequence a government action against the Ijaw nation could be, and being a representative of the people, swift action to resolving the issue would be to the advantage of the Ijaw nation.
The FNDIC commended President Obasanjo for his wise decision in which a peace committee led by Governor Good- Luck Jonathan of Bayelsa State is already in place.
It however appealed to the Ijaw people to eschew violence as only peaceful environment can bring about development and growth urging all parties to the crisis to cease-fire.
However, in an effort to boost supply and ease distribution of petroleum products in the Niger Delta, President Obasanjo has approved the establishment of six depots in the region.
In a related development, the General Officer Commanding (GOC) 2 Mechanised Division, Ibadan, Maj. Gen. Nuhu Bamali, has commended the activities of men of the Niger-Delta Force codenamed “Operation Restore Hope” deployed by the Federal Government to counter the resurgent militia attacks on oil workers, installations and search for the kidnapped foreign oil workers in the region.
He said that the action of the military as at now is satisfactory and in line with the new call for professionalism rather than the use of excessive force.
The GOC who spoke in the office of the Edo State governor, Chief Lucky Igbinedion in Benin yesterday during his three-day visit to military formations in the state said though the soldiers involved have been trained to adapt to the new development in the region and adopt dialogue in their dealings with the restive youths, the Federal Government's position on the development would be respected by the Niger-Delta Force with utmost display of professionalism.
Bamali disclosed that military authorities had done a lot in ensuring that peace and orderliness are maintained in the region, knowing the importance of the region as the oil belt of the nation, and that the renewed efforts of professionalising the activities of the Force was geared towards it.
Earlier in his speech, the governor expressed satisfaction with the relationship existing between the state government and 4th Mechanised brigade in the area of warding off cases of violent crimes in the past in the state and said that though many persons may be trying to advocate for the return of the military in governance.
Meanwhile, President of Nigeria Labour Congress, (NLC) Adams Oshiomhole has called for the release of the four oil workers held hostage by some groups in the Niger Delta since January 11.
Oshiomhole, in a statement yesterday said that the NLC remains firm in its belief that there were compelling local concerns in the Niger Delta which require urgent political and constitutional solutions.
He however said that oil workers, whether Nigerians or expatriates were not in any way responsible for that state of affairs, while their abduction will not solve the problem.
According to him, the NLC is opposed to violence and hostage-taking as means to pursue grievances no matter how justified they may be. read more

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ShellNews.net: ECCR seeks Shell shareholder support for shareholder resolution

The Ecumenical Council for Corporate Responsibility intends to bring a shareholder resolution to Royal Dutch Shell plc’s 2006 AGM.

ECCR believes that Shell’s impacts on `frontline’ communities and the environment in County Mayo, Ireland, the Niger Delta, and at Sakhalin II in Russia merit urgent attention.

The resolution calls for a major improvement in Shell’s performance in terms of community and stakeholder consultation, risk analysis, and social and environmental impact analysis. read more

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RTE News: Shell delegation in Co Mayo for pipeline talks

25 January 2006 15:28
A four-man delegation from the Royal Dutch Shell Company is in Co Mayo for discussions on the controversial €900 million Corrib Gas Project.
The four non-executive directors include the former Dutch Prime Minister Wim Kok, the chairman of the company's Social Responsibility Committee, which travels to locations where Shell projects are the subject of local controversy or opposition.
The delegation met the Chairman of Mayo County Council, Henry Kenny, and seven local councillors behind closed doors in Belmullet this morning.
They are hoping to meet local residents and landowners not opposed to the pipeline in the afternoon.
It is understood that the Shell to Sea campaign group, which is opposed to the building of a high pressure gas pipeline from the Corrib field, has declined an invitation to meet the Shell board members.
The group said it decided not to meet the delegation as formal mediation talks had not yet got under way with Shell and any meeting today would be premature.
A spokesman for Shell said the delegation was on a fact-finding mission to get a deep understanding of local attitudes to the project and would be reporting back to the company.
He stressed that, as non-executive directors, the men had no decision making function, but would be outlining the views of all of those they met in Belmullet today.
The delegation will travel to Dublin tomorrow where it hopes to meet Mayo TDs in Leinster House. read more

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ShellNews.net: Global Floodgates Open on Shell Reserves Fraud Class Action

By Alfred Donovan

On Friday 20 January, we exclusively broke the news that the global floodgates are now open for qualifying non-US Shell shareholders to join a US class action lawsuit which has already been given permission to go ahead by a US District Chief Judge.

The Judge has ruled that Shell has a case to answer for alleged securities fraud and has decided that for the first time in US legal history, non-US shareholders can join a US class action. The lead plaintiffs are the Pennsylvania State Employee Retirement System and the Pennsylvania Public School Employees Retirement System. The class action seeks to recover damages on behalf of all investors worldwide, no matter where they bought shares. read more

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TMC.net: $2m being spent by Shell on security measures including staff training following 34 robberies last year

(IRN News Via Thomson Dialog NewsEdge)
TMC.Net USA: Shell is taking extra security measures at its service stations around the country after 34 robberies last year.
Spokesman Mark Forsyth says more than $2 million is being spent on a staff safety training programme and equipment such as digital cameras and monitored alarms.
He says intelligent safes are being installed which not only reduce the amount of cash staff have access to on site, but also scan every note handed over the counter to detect forgeries. read more

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