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Posts on ‘March 4th, 2006’

ShellNews.net: Oil Company Sleuths

I read with interest the story by Liz Chong published by The Times on Saturday 4 March 2006 under the headline: “Sleuths step out of the dustbins and into the limelight “ – accessible via the link below.
http://www.tellshell.net/blog/_archives/2006/3/4/1796029.html
The story mentions the decision by the US Justice Department to prosecute James Giffen under the Foreign Corrupt Practices Act. Giffen has been accused of funnelling $60 million in bribes to the President of Kazakhstan on behalf of several oil majors, including Mobil Oil, Shell and Chevron.
It is certainly not unknown for oil companies to use agents to engage in underhand activities. For example, the Sunday Times published a story on 17 June 2001 revealing that an undercover agent had carried out spying missions on behalf of Shell (and BP) against perceived enemies such as Greenpeace and The Body Shop. There was even a link to Ken Saro-Wiwa, the Nigerian who was hanged by a corrupt Nigerian regime after leading a campaign against Shell’s activities in the Nigerian Delta. Shell and BP admitted using the relevant spy/saboteur, who operated under a code name. The article can be accessed via the link below.
http://shellnews.net/2004 Documents/sundaytimes/sundaytimesspied8april.htm
An article published by The Mail On Sunday (4 April 2004) revealed how Sir Philip Watts used police spies as part of a private police force armed by Shell to pursue its disgraceful policies in Nigeria. Sir Philip was subsequently sacked as Group Chairman of the Royal Dutch Shell Group as a result of the reserves fraud being revealed in January 2004. The relevant article is accessible via the link below.

http://shellnews.net/2004 Documents/mailonsunday/mailonsundayarmy4april.htm

My son John and I also had problems with Shell undercover activity. The following is an extract from an email received on 11 November 2005 from Shell International General Counsel, Mr. Richard Wiseman. He sent copies of his email to the Chief Executive of Royal Dutch Shell Plc Mr. Jeroen van der Veer and the Chief Executive of Shell Exploration & Production, Mr. Malcolm Brinded.
FROM SHELL GENERAL COUNSEL RICHARD WISEMAN: “Dear Mr Donovan, While you, or John, may have complained to the police about “sinister activities” around the time of previous campaigns, as we said at the time and repeat now, there is no substance in the allegation that Shell had anything to do with such activities. The work done by our enquiry agent was entirely legal and conventional in the context of the litigation.”
The “enquiry agent” in question used the name of “Christopher Phillips” (if that was his real name). This gentleman was caught red handed checking private mail at our offices. He produced a business card which stated that he was a director of Cofton Consultants. This information proved to be completely fake. Using false pretences he integrogated staff with personal questions about us which definitely did not come under the heading of routine activities by an “enquiry agent”. As I pointed out in my response (copied to Van der Veer and Brinded) false pretences and fake documents are neither legal nor conventional (except in the context of “The Rockford Files” on TV).
Shell admitted in writing the relevant undercover “activities” but denied any knowledge of a mass of other undercover operations (there was also a series of burglaries) which perverted the course of justice in respect of High Court litigation then in progress between Shell and my son and I.
As is clear from The Times article, it is now routine practice for big companies to use private investigators. Apparently having a financial advantage over opponents is not enough. Multinational giants are now using underhand tactics to investigate and intimidate adversaries. In my opinion that is unethical and a breach of human rights. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

Petroleum News: Western Canada: And look what we have here….

Gary Park
The oil sands grab bag is never short of surprises, setbacks and successes.
Take the last week of February.
Here’s some of what emerged:

• The Shell-Canada-operated Athabasca project is adjusting to the heaviest blow of its commercial existence, which started in mid-2003, scaling back production to one-third of normal levels of 155,000 barrels per day as it prepares for a complete shutdown that could last two weeks at the end of March.

Trouble surfaced Feb. 24 when a major tear was discovered in a conveyor belt that carries bitumen from the Muskeg River Mine to a nearby extraction plant.
Following a brief halt, operations resumed using an undamaged portion of the belt and Shell Canada hopes to sustain that level of output until the repair work starts.
Part of its challenge is to avoid a shutdown of the Scotford refinery near Edmonton. Various options are being pursued, including a search for feedstock from external sources, to avoid the high cost of an entire refinery closure.
A further cutback will occur in May to allow a scheduled maintenance turnaround.
How much production will be lost during that work is not known.
Shell Canada has a capital budget of C$385 million for its 60 percent share of Athabasca this year — Chevron Canada and Western Oil Sands each hold 20 percent — including a de-bottlenecking to sustain its most recent production numbers over at least three years.
Last year, Athabasca surpassed its design capacity, averaging 159,900 bpd for 2005 and climbing to 178,000 bpd in the final quarter. The 2009 target is 180,000 bpd.
The shutdown was not good news for the consortium, especially Western Oil Sands, which saw its share of output rise 18 percent in 2005 to 32,000 bpd, which has prompted the junior partner to start evaluating four to six potentially significant project opportunities.
• Canadian Oil Sands Trust, which owns 35 percent of the Syncrude Canada consortium, the world’s largest source of synthetic crude, is about to make its unit holders even happier — especially those who bought in at the original C$10 a unit.
The trust plans to split its units 5-for-1 to make them more affordable provided it gets investor approval April 25.
Over the past year, the trust has soared past the C$150 mark. It currently makes quarterly per-unit payments of C$1.
• The Alberta government has bowed to community and industry pressure by agreeing to spend C$500 million to twin a deadly stretch of the 270 mile highway between Edmonton and Fort McMurray, with the Canadian government kicking in another C$150 million.
The existing two-lane route is a major traffic bottleneck for workers and goods serving the booming oil sands.
It has also been blamed for several deadly accidents, including an accident involving a chartered workers’ bus and semi-tractor trailer last year that claimed four lives.
Early this year, two other oil workers were killed when their minivan was hit by a log flying off a truck that had swerved to avoid a collision.
• Canadian Natural Resources said its Horizon project is slightly ahead of schedule for start-up in 2008, with first phase construction 20 percent complete, but it faces a tough challenge to increase its workforce from 1,700 to more than 4,000 by year’s end. The first phase is forecast to produce 110,000 bpd, followed by 232,000 bpd in 2011 and 488,000 bpd within 12 years.
• Nexen and OPTI Canada plan to spend another C$360 million on their Long Lake project, 10 percent above the C$3.5 billion budget.
But they’re not blaming the hike on project overruns that are the curse of the oil sands sector. They said C$250 million will be used to increase the generation of steam, which is injected under pressure to melt deep bitumen deposits.
That will lower the chances of poor bitumen production results, the partners said.
Another C$110 million will be spent on a facility to process soot, a byproduct of Long Lake’s gasifier, cutting operating costs to handle the soot to 30 cents a barrel from a little more than C$1.
• Startup BlackRock Ventures has logged a hefty increase in its oil reserves, which could bolster the potential of its Orion project.
The company now recognizes 195 million barrels of proven and probable reserves and 65 million barrels of possible reserves, allowing it to book an increase of 2235 million barrels of total reserves.
Orion is designed to start operations at 10,000 bpd in mid-2007 and could attain 20,000 bpd over an operating life of more than 30 years. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

Petroleum News: Researchers unraveling the secrets of the Arctic Ocean

Alan Bailey
The big problem with researching what’s under the Arctic Ocean is that much of the ocean is covered with ice for much of the year. That’s the fundamental reason that so little is known about that particular region of the Earth. But scientists believe that the Arctic Ocean contains many missing clues to several aspects of the Earth’s history and geography.
“If you want to make this global model, this global paleoclimate model, this global tectonic model, you need the Arctic. The Arctic is the missing piece,” Bernard Coakley, associate professor of geology and geophysics at the University of Alaska Fairbanks, told an audience at the Pac Com conference in Anchorage on Feb. 23.
Coakley explained how complementary approaches to Arctic Ocean research are gradually building an understanding of the ocean.
“Logistics dictate our (research) opportunities — no single platform is adequate,” Coakley said. “This is the rule of the study of the Arctic.”
Amundsen and the Fram
In the earliest Arctic research, about 100 years ago, Norwegian explorer Amundsen deliberately allowed his ship, the Fram, to freeze into the pack ice and be carried across the ocean, Coakley explained. In a similar type of approach, characterized by Coakley as a “drifting station,” people still successfully operate research stations on drifting ice. The Russians, for example, are currently operating their 33rd floating ice station since World War II.
Other means of Arctic Ocean research include the use of icebreakers, submarines, aerial surveys and satellite surveillance. Each approach has its strengths and weaknesses. Taken together, the various approaches have resulted in a substantial body of data, Coakley said.
Scientists have been painstakingly piecing together this data. And this integration of the data is bringing into focus an ever-clearer picture of how the Arctic Ocean is structured.
“It has allowed us not merely to see the sea floor clearly but also to start to articulate very specific questions about the history and development of the Arctic Ocean,” Coakley said.
One of the most impressive results of this data compilation is the International Bathymetric Chart of the Arctic Ocean, a stunningly detailed image of the physical relief of the ocean floor.
The chart clearly depicts how the ocean consists of two major basins: the Eurasian basin lying north of Europe and western Russia; and the Amerasian basin to the north of North America and eastern Russia. A major subsea ridge, called the Lomonosov Ridge, running almost under the North Pole in a fairly straight line between northern Greenland and northern Siberia, divides the two basins. A pair of in-line subsea ridges, the Alpha and Mendeleev ridges, divides the Amerasian basin into the Canada basin, offshore Alaska and northern Canada, and the Makarov basin, between Ellesmere Island and northeastern Siberia.
Oceanic and continental crust
In general, the Earth’s crust consists of oceanic crust and continental crust. Oceanic crust forms deep under the oceans as a result of the splitting apart of the plates that structure the Earth’s surface. Continental crust forms the building material of the Earth’s continents.
All of the Earth’s oceans are floored by oceanic crust. And the Arctic Ocean is no exception, with oceanic crust under both the Eurasian and Amerasian basins. But we now know that the histories of these two basins are very different, Coakley explained.
The Eurasian basin has formed during the past 60 million years through the continuing propagation across the Arctic region of the vast central ridge that marks the splitting apart and spreading of the Atlantic Ocean — it’s a bit like a giant coat zipper being pulled open from the bottom. The sub-sea Gakkel Ridge, a spectacular feature with a huge central canyon, marks the fissure where the Eurasian Basin is opening up.
Geologists interpret the Lomonosov Ridge as a sliver of continental crust that was split off from northern Europe and Siberia when the Eurasian Basin started to form.
In contrast to the Eurasian basin, the Amerasian basin formed during the Mesozoic era, more than 60 million years ago. And, despite a number of theories, no one really understands the mechanism of formation for the basin; features such as the Alpha-Mendeleev Ridge and the Canada basin remain perplexing puzzles.
“We don’t really understand how they hook up with the global system of plate boundaries that existed during the Mesozoic,” Coakley said.
Data from submarines
But research continues.
Coakley described how submarines play a critical role in revealing the ocean structure. Although aerial and satellite gravity and magnetic surveys can cover vast areas, submarines can enable almost any form of detailed survey anywhere under the ice, Coakley said.
“Submarines have really been the way that we’ve come to know the bathymetry of most of the Arctic Ocean,” he said.
Coakley described his participation in a series of six unclassified cruises by U.S. Navy submarines under the Arctic ice between 1993 and 1999. Known as the SCICEX program, the cruises gathered extensive information about the deep Arctic Ocean, using a variety of geophysical instruments.
Each cruise built on the results of the previous cruise. And the last two cruises were able to perform particularly high-resolution surveys using what are known as swath bathymetry and chirp sub-bottom profiling. Working rather like a conventional sonar system, a swath bathymetry system gathers acoustic reflection data from a swath around a vessel’s track. Chirp is a sonic system that gathers high-resolution reflection data down to 50 to 70 meters below the sea floor, Coakley said.
The Lomonosov Ridge
Chirp data from the Lomonosov Ridge proved particularly revealing.
“Sediments are all parallel, railroad track reflectors,” Coakley said. “There’s no indication of any kind of erosion (within the sedimentary layers).”
However, where the ridge projects above a water depth of about 1,000 meters, there is a very distinctive erosion surface at the top of the layered sediments, with a capping lens of sediment sloping down into the Amerasian basin.
“The only way you can explain this kind of erosion is if you had a huge ice sheet grounded against Lomonosov Ridge,” Coakley said, noting the thickness of ice implied by the depth of the erosion surface below sea level.
“The only place an ice sheet of this dimension might be possible to have come from is the St. Anna trough,” Oakley said. The St. Anna Trough is a huge submarine canyon that connects the deep Eurasian basin with the Barents Sea continental shelf.
The submarine surveys were also able to delineate detailed profiles of the Gakkel Ridge, in the middle of the Eurasian basin. One surprising find was that the base of the canyon running along the axis of this ridge reaches depths of 5,206 meters below sea level, the deepest part of the entire Arctic Ocean.
Arctic drilling
A major reason for the submarine survey of the Lomonosov Ridge was to help determine a drilling location for a summer 2004 Arctic Ocean drilling project. That project drilled to about 400 meters below the sea floor on the Lomonosov Ridge (see “Pioneering drilling in Arctic pack ice” in the Oct. 30, 2005, edition of Petroleum News). During the drilling, a huge Russian nuclear icebreaker and a smaller Swedish icebreaker opened up the pack ice, so that the drill ship (a converted icebreaker) could remain stationary.
“They never had to break off drilling because of ice,” Coakley said.
The drilling recovered a continuous record of sediments through much of the Cenozoic, Coakley said. One of the more startling discoveries was rock with high total organic content in some of the sediments.
The organic material included azolla pollen, indicating warm temperatures near the North Pole many millions of years ago — nowadays azolla only exists in the rice paddies of Southeast Asia, Coakley said. But what adds to the interest of this find is that preservation of the organic material would have required water devoid of oxygen at a position high in the ocean basin. Nowadays, such oxygen-free conditions only exist in deep, restricted basins.
The bottom of the hole encountered Cretaceous-age sands that geologists interpret as what is known as a passive margin, a slowly sinking shelf that sloped into an ancient ocean.
“This is the passive margin that once formed the edge of the Amerasian basin, before the rifting took place that separated the Lomonosov Ridge from the Barents Shelf,” Coakley said.
The icebreaker Healy
The 2004 drilling set the stage for a summer 2005 research cruise by the U.S. Coast Guard icebreaker Healy. Coakley was a co-chief on that cruise.
Equipped with multi-channel seismic equipment using streamers and sonobuoys, as well as equipment for swath bathymetry and chirp surveying, the cruise gathered detailed information about the ocean basin structure and history. The cruise also collected sediment cores from the ocean floor for the study of ancient climate records and oceanography.
After setting out from Dutch Harbor in the Aleutian Islands, the Healy traversed the Chukchi Sea and achieved the first crossing of the Mendeleev Ridge by western research scientists, Coakley said. From the Mendeleev Ridge, the Healy crossed the Makarov basin before rendezvousing with the Swedish icebreaker Oden. The two icebreakers then sailed in tandem across the remainder of the Arctic Ocean, eventually reaching Tromso in Norway.
Relatively open ice conditions for the first half of the cruise enabled the straightforward collection of multi-channel seismic data.
“We got excellent data on the Chukchi and on the Mendeleev Ridge,” Coakley said.
Then worsening ice turned the seismic data acquisition into a significant challenge. Coakley described how large chunks of ice flew up from under the ship’s transom, lifting the seismic air guns above the water. The ship’s propellers would also mill through some of the ice blocks, causing considerable vibration and noise.
“You can see, flying out from under the transom, blocks about half the size of this room that have two big semicircular cutouts in them with spirals from the props milling in the ice,” Coakley said.
Sometimes the ice floated the receivers on the seismic streamer to the surface, and twice the whole streamer broke off.
“One of the interesting things about doing multi-channel seismic acquisition in the Arctic is that anything towed is expendable,” Coakley said. “ … Your streamer is a consumable.”
However, the seismic data gathered during the cruise is providing invaluable knowledge about the ocean floor. For example, a seismic section shows a continuous drape of sediment across the Mendeleev Ridge.
You can see this continuous drape “almost everywhere in the Amerasian basin except on top of the Chukchi, where it was probably eliminated by glacial erosion, and down in the low between the Mendeleev and Alpha ridges,” Coakley said.
The seismic data also detected numerous extensional geologic faults in the Amerasian basin.
What next?
Coakley sees drilling on the Chukchi plateau as the probable next step in Arctic Ocean scientific research.
“I think it will provide a very nice contrast to the record that’s come off Lomonosov Ridge,” Coakley said. “It will also complement a group that’s come together to propose drilling in the Bering Sea.” In conjunction with the Alaska Ocean Observing System, the Barrow Arctic Science Consortium and Barrow itself, Coakley is working to develop permanent seafloor observatories off Barrow, at the northeast end of Alaska’s North Slope. The area near Barrow is one of the best places to see how the sea is changing and how the currents are interacting, he said.
The current federal budget also includes provision for a new University of Alaska Fairbanks vessel known as the Alaska Region Research Vessel. Capable of continuously breaking two-and-a-half feet of level ice, the vessel could operate in the Bering, Chukchi and Beaufort seas.
As a driver for future research Coakley sees strong incentives for nations to measure and map the Arctic Ocean, to clearly define offshore economic exclusion zones, under Article 76 of the United Nations — the United Nations has specified a series of EEZ criteria based on parameters such as a depth contour on the continental slope or the point of maximum curvature on the slope. The Canadians, the Greenlanders and the Danes are particularly anxious to obtain Arctic Ocean data in the area near Ellesmere Island and Greenland, where the ice piles up and is double and triple thickness, he said.
So they’ve invited a submarine to work in their waters. It means that the whole northern edge of North America is open to exploration by submarine.
“I think it’s an incredible opportunity,” Coakley said. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

Petroleum News: Alaska could play pivotal gas role

USGS: State holds 17% of the U.S. natural gas reserves, 20% of the nation’s estimated undiscovered conventional gas resources
By Alan Bailey
With U.S. natural gas consumption growing beyond current rates of domestic supply, Alaska seems poised to become a key natural gas larder for the United States. But just where does Alaska lie in the league table of U.S. natural gas provinces? Where in the state would the natural gas come from? And could the gas be produced viably?
These were some of the questions that U.S. Geological Survey geologist Dave Houseknecht addressed during his talk at the Pac Com conference in Anchorage on Feb. 23.
37 tcf in reserves
In Alaska there are 37 trillion cubic feet of natural gas reserves — gas known to exist in known reservoirs, Houseknecht said. That represents about 17 percent of the total U.S. reserves of 218 tcf, he said.
And Alaska probably holds about 20 percent of U.S. undiscovered conventional natural gas — undiscovered gas estimated to lie within potential geological traps. Even after adding estimates of unconventional gas such as shale gas and coalbed methane to the U.S. total, Alaska probably holds about 15 percent of the national total, Houseknecht said.
“So Alaska’s gas is significant in terms of the national perspective, particularly considering the accessibility of those resources that we consider to be undiscovered in the Lower 48 in many parts of the country,” he said.
And although there are important natural gas reserves in the Cook Inlet area of southern Alaska, the bulk of Alaska’s reserves lie in northern Alaska. Prudhoe Bay with reserves of 24.5 tcf contains a large portion of those reserves. Point Thomson is the second largest known accumulation with reserves of 8 tcf.
Northern Alaska also dominates the numbers when it comes to estimates of undiscovered resources —more than 200 tcf of undiscovered conventional natural gas may exist in the region, including resources on the outer continental shelf.
“The primary attention is in northern Alaska, even though there are significant and important undiscovered resources close to population centers elsewhere in the state,” Houseknecht said.
Assessment uncertainty
Because assessing volumes of undiscovered gas involves making assumptions about geology and other factors, assessment estimates tend to be moving targets. Houseknecht pointed out, for example, that the 2002 USGS assessment of potential oil and gas in the National Petroleum Reserve-Alaska assumed that the oil and gas composition in the Alpine field would typify the hydrocarbon composition in the same geologic setting across NPR-A.
However, results later released from exploration drilling at the Spark and Rendezvous prospects to the west of Alpine proved that assumption wrong — the API gravity of the oil and gas-oil ratios both increase to the west of Alpine. Those results suggest that there may be more gas and less oil in NPR-A than the USGS assessment of the area indicated. But, until more data becomes available, the implications of the results won’t really be known, Houseknecht said.
Gas sources
However, there are some general features of the petroleum geology of northern Alaska that point to some parts of the region being more favorable for natural gas generation than others. And Houseknecht particularly focused on how the characteristics of two major hydrocarbon source rock systems in the region might affect natural gas generation.
The petroleum generating kerogens in source rocks tend to favor gas production in situations where the rocks were laid down on or near land, Houseknecht said. In rocks laid down in marine environments, on the other hand, the kerogens tend to favor oil production.
The first of the source rock systems, the Triassic Shublik-Otuk and Jurassic lower Kingak system, originated from erosion of an ancient landmass to the north of the present North Slope into an ocean in the area of the North Slope. That ancient geography would favor formation of terrestrial gas-generating kerogens to the north and marine oil-generating kerogens to the south.
The ancient disposition of land and sea reversed before the formation of the second and younger source rock system, the Cretaceous Pebble Shale, Gamma Ray Zone and Hue Shale system. These rocks were laid down when a landmass to the south eroded into a newly forming ocean to the north, thus favoring terrestrial gas-generating kerogens in the south and marine oil-generating kerogens to the north.
But the temperatures that the source rocks reach when they become buried deep underground also impact oil and gas production. When source rocks heat up during burial oil tends to form when temperatures reach a certain point. Higher temperatures at deeper burial depths can then crack the oil to produce natural gas.
Along the Beaufort Sea coast of northern Alaska both source rock systems straddle a high structure in the regional geology known as the Barrow Arch. South of the Barrow Arch the source rocks dip deep under massive thicknesses of strata in what is known as the Colville Basin. North of the Barrow Arch the source rocks also slope down under younger rocks on the Beaufort Sea continental shelf. Increasingly deep burial both north and south of the arch would tend to have heated the source rocks through the oil generation window into the gas generation window.
Taking all of these geologic factors together leads to the widely held view that the Brooks Range Foothills and southern North Slope should be more gas prone than oil prone. The geologic factors also predict a more oil prone zone along and on either side of the Barrow Arch. However, the Triassic, Jurassic and Cretaceous source rocks may become more gas prone on the Beaufort Sea continental shelf, especially where burial depths become particularly high towards the edge of the continental slope of the Arctic Ocean.
Houseknecht has also told Petroleum News that there is evidence from onshore oil seeps of an unidentified source rock somewhere in the Tertiary stratigraphic sequence. That rock would lie at higher stratigraphic levels than the other source rock systems and may, therefore, have remained in the oil generation window for some distance offshore under the Beaufort Sea.
Economics
But, with the potential for large volumes of undiscovered natural gas under the North Slope, the Chukchi Sea and the Beaufort Sea, how much of that gas might viably be developed?
USGS has done an economic assessment of undiscovered conventional natural gas in the central North Slope, an area where initial development is most likely to occur because of the proximity of both the existing oil infrastructure and a potential gas export pipeline. The assessment focused on natural gas from gas fields, rather than gas that might be associated with oil in oil fields.
Using an estimated range of gas accumulation sizes and assuming a gas development scenario that includes a future North Slope gas line, the USGS analyst plotted estimated economically recoverable gas volume for gas prices ranging from $2 per thousand cubic feet to $10 per thousand cubic feet.
The mean or average estimated economically recoverable volumes showed gas production starting to become economic at prices a little more than $3 per thousand cubic feet. Economically recoverable volumes increase rapidly to about 25 tcf at $6 per thousand cubic feet. At $10 per thousand cubic feet volumes peak out at about 27.6 tcf, about 83 percent of the total technically recoverable volume.
“Those are fairly significant numbers because for the first time we’ve been able to say that the lion’s share of the technically recoverable gas that we estimate to be present is probably going to be economically recoverable close to infrastructure,” Houseknecht said.
The percentage of technically recoverable gas that can be recovered economically decreases as you move further away from the oil and gas infrastructure, Houseknecht added. He also pointed out that the estimates “are highly dependent on the economic parameters that are associated with the existence of a gas pipeline.”
Non-conventional resources
Houseknecht also talked about some of the non-conventional natural gas resources in northern Alaska, such as gas hydrates, overpressured gas and coalbed methane. Together, these resources contain the potential to produce vast volumes of natural gas. But the technical feasibility and economics of developing the non-conventional resources still remain substantially unknown.
For example, huge quantities of natural gas lie trapped in known gas hydrate deposits in the north central North Slope.
“Currently a partnership of the Department of Energy, BP, the University of Arizona, Alaska DNR, USGS and the Bureau of Land Management is focused on two separate projects, one of which is attempting to characterize the resource and then find out whether it is recoverable … and the other of which is trying to do an assessment of recoverable gas from hydrates,” Houseknecht said.
There’s also a real possibility of overpressured natural gas resources in low-permeability sandstone, or perhaps in shale, deep in the central part of the Colville Basin, between the Brooks Range foothills and the coastal plain, Houseknecht thinks. He cited evidence of overpressure and gas resources from the sonic logs and drill stem tests from the Tulugak well in the central North Slope.
“So we believe the potential exists for a large but as yet non-assessed resource for low-permeability, over-pressured, basin-centered gas beneath the North Slope,” Houseknecht said.
This would be analogous to the overpressured natural gas that is driving quite a bit of exploration in the Rocky Mountains basin, he said.
Coalbed methane is another intriguing possibility in northern Alaska — the North Slope of Alaska has probably more coal resources than the whole of the rest of the United States combined, Houseknecht said. But coalbed methane drilling further south in the state has so far proved disappointing and permafrost in the north will reduce the gas content of the coal, he said.
“We are attempting right now to do an assessment of coalbed methane content of these North Slope coals and the results of that should be released probably within a year,” he said.
But with the likelihood of more than 200 tcf of technically recoverable conventional gas in Alaska, Houseknecht sees strong potential for future gas development.
“It’s a big resource base,” he said. “It’s just a question of when will infrastructure be present to send it to market and how close are those resources to infrastructure to make them economic.” read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

Petroleum News: Shell on fast forward: Purchases Arctic drilling platform…

Purchases Arctic drilling platform, doing geotechnical boring at Hammerhead
By Kay Cashman
Rick Fox, Shell’s new asset manager for Alaska, wasn’t kidding when he told Pac Com attendees in late February that Shell was “ambitious about Alaska.”
The mega-major returned to Alaska in March 2005 and shortly thereafter began moving at the pace of an independent, its primary focus on Alaska’s offshore.
In addition to aggressive lease acquisitions in the Beaufort Sea and Bristol Bay onshore, Shell has already purchased one, possibly two, Arctic drilling vessels for use in Alaska. It also plans to do geotechnical boring in state waters between its offshore federal Hammerhead leases and the shoreline within the Point Thomson unit. And this summer the company has a 3D seismic shoot planned in the Beaufort Sea, likely followed by a shoot in the Chukchi Sea, using WesternGeco’s MV Gilavar. (See article in the Feb. 19 edition of Petroleum News.)
Hammerhead renamed 'Kaktovik'
In its permit application to do geotechnical shallow boring, Shell referred to potential pipeline routes from its leases to shore, saying the work was being done “in support of proposed preliminary development planning at the Kaktovik Prospect — formerly known as the Hammerhead Prospect — offshore the Point Thomson Unit Well 3.”
Kaktovik is the name of the Inupiat village about 60 miles southeast of Hammerhead that sits in the coastal plain of the Arctic National Wildlife Refuge. The ExxonMobil-operated offshore/onshore Point Thomson unit is adjacent to ANWR’s coastal plain; the edge of the Hammerhead leases is 10 miles north of the Point Thomson unit boundary.
U.S. Minerals Management Service data estimates 100 million to 200 million barrels of oil at Hammerhead, although the agency also says the reservoir has not been fully delineated.
Shell said the purpose of the shallow boring, which will be done by contractor Duane Miller & Associates, is to identify soil types and characteristics “for engineering and design studies.”
The drill ship purchase and project overview portion of Shell’s geotechnical boring application has borough officials thinking Shell is doing some serious development planning for the Kaktovik prospect.
For example, in the application Shell said, “The soil and permafrost conditions along the proposed pipeline route to the mainland need to be explored. In waters shallower than 6 feet, ice bonded permafrost could be present. Ice bonded permafrost has been found in deeper waters when the soils are stiff clay such as the Flaxman formation. Ice-bonded permafrost will be encountered at the shoreline transition, and the thaw-settlement of the permafrost needs to be determined so that the transition from the buried mode to above grade piping can be designed.”
The application also said, “To provide the data to meet objectives, two shoreline and pipeline routes may be drilled and sampled. … Before any offshore drilling is started, Lewellen Arctic Research will perform a reconnaissance of the sea ice conditions. Ice conditions will control where DM&A can safely travel and drill. DM&A anticipates that the drilling will start with the onshore and near shore work, and while that work is proceeding safe routes can be established for the holes in deeper water.”
Approximately 60 borings will be taken along the offshore pipelines routes, Shell’s application said.
DM&A plans to bore 100-feet-plus below the mud line, noting that this same drill set-up achieved soil sampling to depths of 190 feet below 20 feet of water at a crossing of the Colville River. The hollow stem augers make an 8-inch diameter hole.
A four-person, two-shift crew will work 24 hours per day, stay in an abandoned Point Thomson drill site (No. 3), and be supervised by senior geologist Tom Culkin.
The drilling equipment will be mounted on an enclosed sled and hauled to the staging area by Catco rolligons.
The geotechnical boring permit calls for all work to be completed by May 15.
Just back from Barrow
Fox and two other newly hired Shell Alaska officials, Cam Toohey and George Ahmaogak, former mayor of the North Slope Borough, just returned from a late February visit to the North Slope Borough where they met with the mayor, planning department officials and others — and picked up the geotechnical boring permit, which had been applied for Feb. 15.
Borough officials said Ahmaogak, Toohey and Fox talked about Shell’s recent purchase of the Kullu Arctic Floating Platform, a circular drilling barge that Daily Oil Bulletin says is designed to stay on location with up to 1.3 meters of ice moving against its hull.
The company plans to use the Kullu, which it bought from Seatankers Management Co., in federal waters outside the borough’s jurisdiction but will need a “safe harbor” for it if and when they drill “far to the west of Prudhoe Bay,” a borough official said.
Kullu drilled Hammerhead in 1980s
Formerly called the Kulluk, the Kullu was used by Union Oil to drill its Beaufort Sea Hammerhead wells in 1985 and 1986 and by ARCO Alaska in 1993 to drill the Wild Weasel well, also in the Beaufort. The Kullu has been moored at Inuvik in the Northwest Territories. It will be refurbished after it has been hauled to Alaska early this summer.
According to Seatankers’ specs on the Kullu it has six 15-t Bruce and six 12-t Stevpris anchors; and “underwater fairleads for ice,” which in simpler language is a 12 point mooring system that comes out under the ice so the anchors don’t get fouled by the ice.
Designed for the Alaska and Canada Arctic, the Kullu was built by Japan’s Mitsui Engineering & Shipbuilding to work in water depths of 60-600 feet with a drilling depth of 20,000 feet.
It contains quarters for 108 persons, a four-bed hospital, recreational areas and a heliport.
The hull is 266 feet in diameter by 98 feet high. At present the drilling equipment consists of the following:
• Drawworks — Ideco E3000
• Pumps — Two Ideco T-1600 triplex
• Prime movers — Three Midwest/GM EMD 16E9B
• Rotary Table — Ideco LR 495
• Top Drive — Varco TDS-3
• Derrick —160 feet tall with a 1.4 million pound cap
• BOP system — NL Shaffer; one 10,000-psi, 18 3/4 inches; one 15,000-psi, 18 3/4 inches
The Kullu has three cranes and is equipped with diving equipment, including a bell and decompression chamber rated to 1,000 feet.
Second drilling vessel unconfirmed
Petroleum News sources say Shell has also leased or purchased another Arctic drilling vessel, but that information was not confirmed by Shell or by borough officials.
However, the company will need two vessels to drill their offshore prospects in Alaska to meet government oil spill contingency requirements because most of Shell’s leases are in deeper water outside the barrier islands, so an ice island or gravel island would not work. Instead two drilling vessels can support one another in case of an oil spill.
In a Feb. 28 interview with Petroleum News, Shell’s Alaska Exploration Manager Chandler Wilhelm said the company is in the process of making plans for its upcoming drilling campaign, but is not ready to talk about it because Shell officials are still in the process of meeting with key stakeholders.
“We have some plans to execute a drilling plan on our leasehold but doing so … involves more discussions with some important stakeholders,” Wilhelm said.
Shell, borough officials said, has been diligent about keeping local residents informed of their plans.
Editor’s note: Part two of this story will appear in the March 12 edition of Petroleum News. read more

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Petroleum News: Shell on fast forward: Purchases Arctic drilling platform…

Purchases Arctic drilling platform, doing geotechnical boring at Hammerhead
By Kay Cashman
Rick Fox, Shell’s new asset manager for Alaska, wasn’t kidding when he told Pac Com attendees in late February that Shell was “ambitious about Alaska.”
The mega-major returned to Alaska in March 2005 and shortly thereafter began moving at the pace of an independent, its primary focus on Alaska’s offshore.
In addition to aggressive lease acquisitions in the Beaufort Sea and Bristol Bay onshore, Shell has already purchased one, possibly two, Arctic drilling vessels for use in Alaska. It also plans to do geotechnical boring in state waters between its offshore federal Hammerhead leases and the shoreline within the Point Thomson unit. And this summer the company has a 3D seismic shoot planned in the Beaufort Sea, likely followed by a shoot in the Chukchi Sea, using WesternGeco’s MV Gilavar. (See article in the Feb. 19 edition of Petroleum News.)
Hammerhead renamed 'Kaktovik'
In its permit application to do geotechnical shallow boring, Shell referred to potential pipeline routes from its leases to shore, saying the work was being done “in support of proposed preliminary development planning at the Kaktovik Prospect — formerly known as the Hammerhead Prospect — offshore the Point Thomson Unit Well 3.”
Kaktovik is the name of the Inupiat village about 60 miles southeast of Hammerhead that sits in the coastal plain of the Arctic National Wildlife Refuge. The ExxonMobil-operated offshore/onshore Point Thomson unit is adjacent to ANWR’s coastal plain; the edge of the Hammerhead leases is 10 miles north of the Point Thomson unit boundary.
U.S. Minerals Management Service data estimates 100 million to 200 million barrels of oil at Hammerhead, although the agency also says the reservoir has not been fully delineated.
Shell said the purpose of the shallow boring, which will be done by contractor Duane Miller & Associates, is to identify soil types and characteristics “for engineering and design studies.”
The drill ship purchase and project overview portion of Shell’s geotechnical boring application has borough officials thinking Shell is doing some serious development planning for the Kaktovik prospect.
For example, in the application Shell said, “The soil and permafrost conditions along the proposed pipeline route to the mainland need to be explored. In waters shallower than 6 feet, ice bonded permafrost could be present. Ice bonded permafrost has been found in deeper waters when the soils are stiff clay such as the Flaxman formation. Ice-bonded permafrost will be encountered at the shoreline transition, and the thaw-settlement of the permafrost needs to be determined so that the transition from the buried mode to above grade piping can be designed.”
The application also said, “To provide the data to meet objectives, two shoreline and pipeline routes may be drilled and sampled. … Before any offshore drilling is started, Lewellen Arctic Research will perform a reconnaissance of the sea ice conditions. Ice conditions will control where DM&A can safely travel and drill. DM&A anticipates that the drilling will start with the onshore and near shore work, and while that work is proceeding safe routes can be established for the holes in deeper water.”
Approximately 60 borings will be taken along the offshore pipelines routes, Shell’s application said.
DM&A plans to bore 100-feet-plus below the mud line, noting that this same drill set-up achieved soil sampling to depths of 190 feet below 20 feet of water at a crossing of the Colville River. The hollow stem augers make an 8-inch diameter hole.
A four-person, two-shift crew will work 24 hours per day, stay in an abandoned Point Thomson drill site (No. 3), and be supervised by senior geologist Tom Culkin.
The drilling equipment will be mounted on an enclosed sled and hauled to the staging area by Catco rolligons.
The geotechnical boring permit calls for all work to be completed by May 15.
Just back from Barrow
Fox and two other newly hired Shell Alaska officials, Cam Toohey and George Ahmaogak, former mayor of the North Slope Borough, just returned from a late February visit to the North Slope Borough where they met with the mayor, planning department officials and others — and picked up the geotechnical boring permit, which had been applied for Feb. 15.
Borough officials said Ahmaogak, Toohey and Fox talked about Shell’s recent purchase of the Kullu Arctic Floating Platform, a circular drilling barge that Daily Oil Bulletin says is designed to stay on location with up to 1.3 meters of ice moving against its hull.
The company plans to use the Kullu, which it bought from Seatankers Management Co., in federal waters outside the borough’s jurisdiction but will need a “safe harbor” for it if and when they drill “far to the west of Prudhoe Bay,” a borough official said.
Kullu drilled Hammerhead in 1980s
Formerly called the Kulluk, the Kullu was used by Union Oil to drill its Beaufort Sea Hammerhead wells in 1985 and 1986 and by ARCO Alaska in 1993 to drill the Wild Weasel well, also in the Beaufort. The Kullu has been moored at Inuvik in the Northwest Territories. It will be refurbished after it has been hauled to Alaska early this summer.
According to Seatankers’ specs on the Kullu it has six 15-t Bruce and six 12-t Stevpris anchors; and “underwater fairleads for ice,” which in simpler language is a 12 point mooring system that comes out under the ice so the anchors don’t get fouled by the ice.
Designed for the Alaska and Canada Arctic, the Kullu was built by Japan’s Mitsui Engineering & Shipbuilding to work in water depths of 60-600 feet with a drilling depth of 20,000 feet.
It contains quarters for 108 persons, a four-bed hospital, recreational areas and a heliport.
The hull is 266 feet in diameter by 98 feet high. At present the drilling equipment consists of the following:
• Drawworks — Ideco E3000
• Pumps — Two Ideco T-1600 triplex
• Prime movers — Three Midwest/GM EMD 16E9B
• Rotary Table — Ideco LR 495
• Top Drive — Varco TDS-3
• Derrick —160 feet tall with a 1.4 million pound cap
• BOP system — NL Shaffer; one 10,000-psi, 18 3/4 inches; one 15,000-psi, 18 3/4 inches
The Kullu has three cranes and is equipped with diving equipment, including a bell and decompression chamber rated to 1,000 feet.
Second drilling vessel unconfirmed
Petroleum News sources say Shell has also leased or purchased another Arctic drilling vessel, but that information was not confirmed by Shell or by borough officials.
However, the company will need two vessels to drill their offshore prospects in Alaska to meet government oil spill contingency requirements because most of Shell’s leases are in deeper water outside the barrier islands, so an ice island or gravel island would not work. Instead two drilling vessels can support one another in case of an oil spill.
In a Feb. 28 interview with Petroleum News, Shell’s Alaska Exploration Manager Chandler Wilhelm said the company is in the process of making plans for its upcoming drilling campaign, but is not ready to talk about it because Shell officials are still in the process of meeting with key stakeholders.
“We have some plans to execute a drilling plan on our leasehold but doing so … involves more discussions with some important stakeholders,” Wilhelm said.
Shell, borough officials said, has been diligent about keeping local residents informed of their plans.
Editor’s note: Part two of this story will appear in the March 12 edition of Petroleum News. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

Dow Jones Newswires: Plaintiffs Seek To Include Non-US Holders In Shell Suit

LONDON -(Dow Jones)- Lead plaintiffs in a U.S. class action against Royal Dutch Shell PLC (RDSB.LN) filed Wednesday a motion seeking consent for non-U.S. shareholders to join the legal action, one of the lawyer representing them said Friday.
The motion follows a preliminary decision by a New Jersey judge, in August, that permitted a plaintiffs claim to continue on behalf of both U.S. and non-U.S. investors, said John Keefe, Jr., a lawyer with Lynch Keefe Bartels.
Shell had argued shareholders who held stock on non-U.S. stock exchanges should not entitled to be proper class members, he said.
He said the plaintiffs' motion seeks a classification on the overall size and scope of the class, which could include a final decision by the judge whether to allow foreign investors to participate.
The inclusion of foreign shareholders in the class action would come after 26 Dutch public pension funds on Jan. 9 filed a separate class action seeking hundreds of millions of dollars in the U.S.
The lead plaintiffs in the class action for which the motion was filed on Wednesday are the Pennsylvania State Employee Retirement System and the Pennsylvania Public School Employees Retirement System. They initially sought financial damages in 2004 after Shell's shares slumped following a series of oil-reserves cuts.
The motion, filed with a New Jersey court, says the plaintiffs want to appoint Peter Wood, a U.K. citizen resident in Andorra, as a representative for all non-U.S. shareholders who would join the case. The lawsuit is formally against Royal Dutch Petroleum Co. and Shell Transport and Trading PLC, Shell's former dual parent companies which last year unified into a single structure.
Lynch Keefe Bartels is liaison counsel for the class action while Bernstein Liebhard & Lifshitz LLP is the lead counsel.
Company Web site: http://www.shell.com
-By Benoit Faucon, Dow Jones Newswires; 44-20-7842-9266; [email protected]
(END) Dow Jones Newswires read more

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Daily Times (Pakistan): VIEW: Nigeria’s road to ruin

VIEW: Nigeria’s road to ruin — Ian Bremmer
In some ways, Nigeria is plagued with the same problems facing Iraq. Various ethnic and religious groups, based in different regions, are battling for oil revenue and political clout. As in Iraq, the conflict could provoke large-scale bloodletting. Yet, unlike Iraq, Nigeria has a recent history of relatively stable democratic governance
With so much political friction in Iran and Iraq, it is easy to overlook the growing unrest in Nigeria, the world’s eighth-largest oil exporter. But Nigeria’s mounting social and political problems reveal how violence and uncertainty in yet another major energy producer is driving foreign investors out and global oil prices up.
Nigerian President Olusegun Obasanjo appears poised to try to amend the country’s constitution to allow himself a chance at a third term. To that end, he has marginalised many of his political rivals. Vice President Atiku Abubakar — a likely presidential aspirant in 2007 — has been harassed and isolated. Ministers suspected of less than full loyalty have been sidelined.
But Obasanjo’s adversaries have joined the battle, and the president lacks the two-thirds majority needed in both the federal and state legislatures to remain in power after next year. Two former Nigerian presidents, Generals Muhammadu Buhari and Ibrahim Babangida, publicly oppose Obasanjo’s constitutional meddling, and several governors of Nigeria’s Muslim-dominated northern states have made clear that they are determined to see Obasanjo off when his term expires in 2007.
As a result, the uncertainty surrounding Obasanjo’s plans is increasing sectional tensions. At stake is the cohesion of a state that many argue is yet another example of an artificial nation cobbled together by Europeans who did not understand their creation’s social, tribal, and religious forces.
Northern governors oppose a third term for Obasanjo because they believe it is now their turn to choose Nigeria’s president under a deal, struck with their southern counterparts when democracy was introduced in 1999, for regional rotation of the presidency. Southern governors argue that control of the presidency should remain with the south for years to come, because the north controlled the country for more than three decades of dictatorship.
Indeed, even southern governors who are not reliable Obasanjo allies appear determined to maintain their influence in the central government by ensuring that the country’s next president is a southerner. For the moment, Obasanjo offers them their best opportunity to realise that goal. Last December, 16 of Nigeria’s 17 southern governors signed the “Enugu Declaration” in support of the constitutional amendment that would permit him a third term.
This is a bad time for Nigeria’s federal government to face these distractions. The Niger Delta region, home to most of Nigeria’s oil and many of its poor people, is in turmoil. In October 2004, violence in the region forced Obasanjo’s government to negotiate with militia leader Asari Dokubu, after his men attacked a series of Royal Dutch Shell oil facilities and threatened to “burn down the area”. In December 2004, Dokubu’s militias took 75 oil workers hostage and forced Shell to shut down about 10 percent of the country’s oil supply. Dokubu then forced Obasanjo into a peace deal.
The deal did not last long. After Dokubu renewed threats to oil infrastructure last September, he was arrested on sedition charges and now faces the possibility of execution or life in prison. Dokubu’s allies have responded with new attacks. A splinter group, the Movement for the Emancipation of the Niger Delta, has claimed credit for several recent attacks and kidnappings of foreign workers, and says it will not retreat until Delta states gain control of the revenue produced by locally extracted oil.
There are also fears that the splintering of Dokubu’s militias has created fertile ground in the Delta for Islamist groups. A few weeks ago, a previously unknown organisation called “The Martyr’s Brigade” claimed credit for attacks on Delta pipelines, raising concerns among multinationals that mercenary resistance in the region is becoming ideological.
Whatever the motivations of the various groups, a surge of militia attacks and kidnappings over the past several weeks has now shut down roughly 20 percent of Nigeria’s oil exports and killed dozens of people. Shell has closed key facilities in the Delta after the abduction of several workers. Once a verdict is reached in Dokubu’s trial, probably this summer, violence is expected to intensify.
In addition, religious violence sparked by the Danish cartoons mocking Prophet Muhammad [peace be upon him] ripped through Nigeria in February. Angry Muslim and Christian mobs burnt churches and mosques, killing dozens of people in a series of attacks and reprisals that have deepened the sectional divide between the Muslim north and the Christian south.
If all this turmoil weren’t enough, the discovery of avian flu in the northern provinces further undermines political stability. Obasanjo has called on Muslim farmers in the area to cull their birds, a key source of protein in a region where malnutrition is a constant threat.
In some ways, Nigeria is plagued with the same problems facing Iraq. Various ethnic and religious groups, based in different regions, are battling for oil revenue and political clout. As in Iraq, the conflict could provoke large-scale bloodletting.
Yet, unlike Iraq, Nigeria has a recent history of relatively stable democratic governance. The country’s factions each have good reason to compromise before the conflict comes to a head. Northern governors could, for example, offer the southern states a larger share of Nigeria’s oil revenue in exchange for their support for a northern president.
But achieving such a compromise won’t be a smooth or predictable process. On the contrary, the risks of extended political instability and further large-scale disruptions to Nigeria’s oil output will remain high, at a time when the world can least afford it. —DT-PS
Ian Bremmer, president of Eurasia Group, the political risk consultancy, and a columnist for ‘The Financial Times’, teaches at Columbia University read more

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Daily Telegraph: Cairn climbs as India eyes oilfields

By Katherine Griffiths (Filed: 04/03/2006)
The possibility that Cairn Energy, Europe's largest independent oil company, might be swallowed by a larger rival has again been raised after India's state-run energy company said it was interested in buying Cairn's prized assets in the country.
Shares in the Edinburgh-based company rose 30p to £19.97 yesterday after Subir Raha, chairman of India's Oil and Natural Gas Corporation (ONGC), said a bid for Cairn's oilfields in the country was “one of the opportunities we are looking at”.
Cairn's Indian assets have been valued by analysts at about £2bn. They include extensive oilfields in the desert of Rajasthan which, when Cairn discovered them in 2004, marked the largest finds in India for 22 years.
The discovery also transformed Cairn, founded by chief executive Sir Bill Gammell, pushing the shares up 400pc since January 2004 and making it the largest oil and gas company below national majors such as Shell and BP.
Cairn also operates in Bangladesh and Nepal. The Rajasthan fields are still in the exploration phase. If they meet expectations, they should more than double Cairn's daily delivery to 250,000 barrels.
ONGC is Cairn's exploration partner in India. If it tabled a bid it would be buying Cairn's largest and fastest growing part of the business.
Cairn, which reports full-year results on March 14, would not comment on the possibility of a closer tie-up with ONGC. read more

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The Times: Sleuths step out of the dustbins and into the limelight

By Liz Chong
Companies may not admit using them, but private investigators have gained acceptance.
THEIR clients include governments, leading investment banks, hedge funds, private equity houses and FTSE 100 companies, but few would admit that they have ever hired corporate detectives, let alone met any.
It would be too embarrassing to reveal that a company had enlisted the help of a private investigator to dig up the dirt on an opponent or client, or disclose that they had been duped by an employee or partner.
None want to suffer similar humiliation to that heaped on Procter & Gamble, forced to pay a $10 million out of court settlement to Unilever in 2001 after admitting that it had spied on its rival. The investigation involved rifling through Unilever’s dustbins in Chicago.
And yet business investigation and intelligence is on the rise, driven by an array of legislation introduced by the US Congress in an attempt to clean up corporate America. The laws impose heavy duties on directors, accountants and lawyers. Directors, perhaps not surprisingly now that they are personally liable for any financial scandals, want to avoid falling foul of prosecutors, who have zealously pursued white-collar crime in recent years, with the open backing of the Bush Administration.
Bill Waite, chief executive of the Risk Advisory Group, an “investigation and intelligence consultancy”, identified the regulatory burden as “the biggest substantive driver for growth in business intelligence”.
The decision by the US Justuce Department to prosecute the lawyer James Giffen under the Foreign Corrupt Practices Act has also made companies increasingly nervous about the background of prospective partners. Giffen was accused of funnelling $60 million in bribes to the President of Kazakhstan on behalf of several oil majors, including Mobil Oil, Shell and Chevron.
Although the legislation dates from 1977, American authorities were previously slow to pursue any companies or individual Americans who had broken anti-bribery laws.
The plethora of bribery and corruption legislation has made it common practice for investors to hire investigators to look at the hedge funds they may invest in, or for private banks to hire companies that examine the background of a new client from Eastern Europe.
The end of the Cold War has also proved a catalyst for the growth of corporate investigations, as companies expand into new markets, including Russia. Western companies that are unfamiliar with the business culture in Eastern Europe and Russia have nowhere to turn for help but to companies such as Kroll and Control Risks.
Charles Hecker, head of the Russia practice at Control Risks, says: “We are in an environment where investors are being pulled further and further beyond their comfort zones of traditional markets.”
He cited Russia and its lack of transparency. A company looking to enter a joint venture in Russia would be well advised to investigate the political links and background of its partner.
Increasingly aggressive business tactics make it standard practice for private equity houses to use investigators to examine the curriculum vitae of the chief executive of a potential target.
Similarly, investment banks advising well-known businessmen on mergers and acquisitions have been known to conduct due diligence on their past by hiring corporate sleuths.
Lawyers are also a steady stream of revenue for the industry. Gary Miller, head of fraud and investigations at Mishcon de Reya, the law firm, frequently hires GPW, Kroll and their competitors to investigate how a fraud was perpetrated, and trace stolen assets.
Miller has spent the past 15 years building up a database of investigators and has about 400 companies on his list. He takes a pragmatic view of the industry and its techniques: “There is lawful bugging and there is unlawful bugging. You can stay within the constraints of the law if you tap or monitor telephone calls in the office. Equally, dustbins can be quite good. They are very useful.”
RELATED ARTICLE ALSO PUBLISHED BY THE TMES ON 4 MARCH 2006

MI5 and MI6 discover new market for spies like us

By Michael Evans, Defence Editor
HOW vulnerable are Britain’s secret intelligence agencies to the lucrative alternative job offers now being made by private security companies? Spies with foreign travel experience and analysis skills are in big demand in the private sector — and the salaries on offer can be tempting for Crown servants earning relatively low pay.
There is no evidence of a serious exodus of intelligence officers from MI6 and MI5, but in recent years the private security company business has proliferated to such an extent that the secret agencies have lost some of their key staff.
One intelligence official said: “There’s no question that these companies are now providing an attractive alternative for perhaps the more adventurous and entrepreneurial members of the agencies, and they can get double the salary.”
In the same way that the SAS regiment has been looked on as a potential rich source for security company headhunters, MI6 and MI5 have been viewed in the same light. However, to judge by the increasingly successful recruiting campaigns by the two agencies, there are still enough men and women who prefer to serve their country at a lower salary — and a guaranteed pension.
Nevertheless, there is a market for ex-spies. Although television programmes tend to spice up the lives of the average MI6 or MI5 officer, giving the impression of a secret world unaccountable either to the law or to Parliament, the reality is far more mundane, and more bureaucratic. Both these agencies have to account for everything that they do, and that means form-filling. MI6 also works according to requirement guidelines set by Cabinet Office gurus, and any planned operation that might in any way cause political problems for the Government has to be approved by the Foreign Secretary.
So, for the more maverick- inclined spy, the controls and bureaucracy of the agencies might seem unappealing after a period in either Thames House (MI5) or Vauxhall Cross (MI6); and this is where the private security companies can benefit.
Less bureaucracy and more money are potentially attractive options for someone who enjoys the secret world but hankers after a more free- spirited environment.
A number of private security companies now have former MI5 and MI6 officers on their staff. Indeed, some companies have been set up by ex-spies and have retained links to their former government employers. read more

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.
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