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Oil & Gas Journal: World’s Most Sustainable and Ethical Oil Companies – 2006

World’s Most Sustainable and Ethical Oil Companies – 2006
A new report about Ethics, Sustainability, Corporate Governance, Transparency and Corporate Social Responsibility of the major worldwide oil companies, is available from The Oil & Gas Journal Online Research Center. The report is by Management & Excellence S.A., the prestigious research and rating company.
This report makes an in-depth comparison of the business practices of 15 of the major worldwide oil companies. This is the third in-depth study measuring oil companies’ compliance with over 280 key areas of sustainability, corporate governance, ethics, social responsibility and transparency by the Madrid-based ethics research and rating company Management & Excellence S.A.
The study uses the M&E Facts Only method consisting of a list of 280 internationally recognized standards in sustainability, corporate governance, social responsibility and ethics, customized for the oil industry. M&E surveyed all companies included and researched public information services to determine actual point-by point compliance with these standards. All percentages in the report refer to the number of points with which a company complies out of a total of over 280.
The report provides a true comparison for evaluating the business practices of these major oil companies. THIS REPORT PROVIDES THE LATEST INFORMATION ABOUT THE TRENDS AND MOVEMENTS OF COMPANIES IN THE OIL INDUSTRY, IN FIVE (5) AREAS ANALYZED; SUSTAINABILITY, CORPORATE GOVERNANCE, ETHICS, SOCIAL RESPONSIBILITY, AND TRANSPARENCY.
This report is a must for evaluating the future for these companies and the industry.
Product No. M&E2006
Price: $6,000 US (5000 Euros) *
To Order:
Phone: 1.800.752.9764
or 1.918.831.9421
E-mail: [email protected] For More Information:
E-mail: [email protected]
Phone 1.918.831.9488
To order online go to the OGJ Online Research Center web site
www.ogjresearch.com
Following is a summary of the results of this study –
A press release issued by Management & Excellence, S.A.
PRESS RELEASE
Shell Again Most Sustainable Oil Company in 2006
Brazil's Petrobras Moves to 2nd; Exxon Drops to 9th Place; Four of Top-5 Are European
Madrid, 22 February 2006: Shell tops the list of the worlds most sustainable and ethical oil companies for the third year running. In the 2006 study Shell achieves the highest score of any oil company ever, achieving 89.01%. This is the result of the third in-depth study measuring oil companies' compliance with over 280 key areas of sustainability, corporate governance, ethics, social responsibility and transparency by the Madrid-based ethics research and rating company Management & Excellence S.A.
Shell was able to substantially improve its already strong 2005 performance of 82% even though this year's study covered roughly twice as many areas as the 2005 study, thus adapting to higher benchmarks in sustainability in the oil business. Shell subscribes to no fewer than 12 codes of human rights and its board met a record 29 times in 2004. By comparison, top-rated BP's board only met 8 times. The company offers grievance channels for its personnel in over 50 countries and is implementing 120 biodiversity projects worldwide. No oil company studied was as transparent as Shell: the company publishes 13 separate reports on topics ranging from environmental impact assessment to animal testing.
Other major movements in the M&E league table, which scores the actual compliance by oil companies to established standards in sustainability and related fields, includes Brazil's Petrobras , which moves up this year from 7th in 2005 to 2nd position. While Exxon scored 80% in 2005, it only achieved a score of 68,1% this year, owing to gaps in reporting and thus dropping it from 2nd to 9th place in 2006. For a company its size, Exxon gives little information on its employee performance measurement systems, supplier management, and is not listed in the FTSE4Good or Dow Jones Sustainability indices.
On the other hand, companies are generally improving their transparency. Russia's Lukoil manages to raise its total score by 23 percentage points from 35% to 58.61%, or a jump of 67%. In September 2005 Lukoil brought out its first sustainability report discussing its achievements in environment, employee benefits and community support, which more than doubled its transparency score from 29% in M&E's 2005 ranking to 62% in 2006. Lukoil is known to be the internationally most widely traded Russian equity, listed in London as an ADR.
Environment Still First Priority:
Being in an environmentally risky business, oil companies still consider environment a top priority. Investments by European and U.S. companies in “environment” outpace health and safety expenses. Italy's Eni spent about €670m (about $800m) on the environment while health & safety was only a third of this figure. Among companies in first world countries, recultivating polluted or effected land makes up the lion's share of environmental expenditures. ENI allocates over 30% of its environmental budget to this area and spends an additional 6.4% on environmental restoration, compared with 2.3% for R&D and 0.5% for environmental training.
Fourteen of the 15 companies ranked here publish annual environmental reports. Even Russian gas giant Gazprom has been publishing ecological reports since 1995. While plant modernizations are the focus of companies with older facilities such as Lukoil, Gazprom, Petrobras and Pemex, European and US companies are concentrating on reducing emissions and energy use. BP consumed 200 GJ less in energy in 2004 over 2003 and instituted a five-year $350m internal innovation program to reduce energy consumption throughout the company. Besides improving sustainability and profitability, this means lower emissions generated by producing oil products. BP claims to have generated 400.000 tons of greenhouse gases due to this program alone. BP also saved electricity by using cogeneration processes in which it generates electricity from heat waste in its own production facilities, saving 6 million tons of CO2 gases and an undisclosed sum of money.
Known for its environmental scandals, Rio de Janeiro-based Petrobras completed an about-face a few years ago when it launched an R$ 40m, 30 project environmental investment program. The program immediately paid off as equipment was modernized and oil spillages abated. In a recent public survey in Brazilian cities by Omni, the public now considers Petrobras to be the most environmentally and socially responsible company in Brazil. The good public image did not come without concerted effort. It invested a total of R$ 18 m in sponsorship programs alone. And it reached out to the people with everything it could, including organizing surf competitions in Buzios, a famous resort near Rio. For 2006 Petrobras advertises its sponsorship program and requesting applications for sponsorship.
Low Priority Given to Alternative Energies:
While most companies were proud of reducing water and energy use and reducing emissions, many appear at best ambivalent on new and renewable energy sources. Under “New Energy” Statoil merely describes its energy conservation efforts. In its detailed outlook for energy consumption, Exxon claims that energy derived from solar and wind will grow by 11% annually but still might only constitute 1% of the energy market. Yet others are taking alternative energies seriously as business opportunities, notably Norsk Hydro and BP. Norsk operates its own water power and alternative energy division Hydro, which owns rights for large scale water power through 2051. BP operates BP Solar, a globally growing solar panel company. Both companies are involved in wind power as well. The “clean fuel” hydrogen, which burns at a rate of 90% is being pushed by Hydro, BP and Statoil, which aims at becoming a major hydrogen producer. Being a gas company, Gazprom is pushing to expand the use of gases as an automotive fuel throughout Russia.
Corporate Governance Still Weak
Of the five overall areas studied (sustainability, corporate governance, corporate social responsibility, ethics and transparency), companies do worst in corporate governance, averaging only 58.61%. The differences between the companies is the greatest in this area with Shell and Petrobras both achieving 83.3% and Petronas only getting 4.1%. State companies such as Gazprom and Pemex generally did worst, lacking a management structure controlled by independently staffed board committees. Surprisingly, the three U.S. companies barely made it over the 60% mark despite Sarbanes-Oxley, NYSE laws and the like.
Sponsorships Help Image and Productivity
Sponsorships have a long tradition in the oil business and all other businesses having a potentially negative impact on peoples' health or well-being. Last year Exxon spent over $106m on community-related sponsorships. Sponsoring sports, especially motor sports, is typical in oil, as exemplified in the Petronas-Sauber formula 1 team.
Getting people involved in voluntary work is also a popular approach for accruing image points and making friends with employees and local communities. Mexico's Pemex runs a telethon involving volunteers which raised $135.000 in 2005, supporting nearly 200 handicapped children. Exxon met $26m its volunteers gathered with a grant of nearly $21m. BP spends $500m every three years in education, enterprise development and access to energy in countries where it operates.
Most companies invest heavily in human resource development and training, such as France's Total which spends €160m on training ($192m) annually. Training entails higher productivity but also fewer expensive accidents in what is a fairly dangerous business. To this end, Statoil trained 23.500 employees and contractors in 100 safety seminars. Most companies are proud of a continuous drop in injuries and absenteeism among employees and even suppliers. At Total, injuries among employees and contractors dropped from 46 in 2002 to 20 in 2004.
The strong link between employee satisfaction and productivity has prompted an increasing number of companies to carry out annual employee satisfaction surveys. Chevron claims that 89% of its employs thought it behaves “responsibly in relation to the environment” and 80% think Chevron cares about the health and well-being of its employees.
Europeans Ahead of Americans in Transparency:
Two years ago Shell made headlines for misreporting its reserves and in 2005 Repsol downgraded its reserves. Both cases cast doubt on the transparency of oil companies. In fact, accurately reporting oil reserves is a complicated matter, often depending on unpredictable factors such as drilling arrangements with partner companies. To counter the impression that it wasn't telling the whole truth, Shell now publishes a 40-page document explaining how it determines and monitors actual reserves and how this process complies with SEC guidelines.
Yet oil companies have been among the most transparent businesses around, using sustainability, social responsibility and ethics as good promotion topics. And thus they continue to upgrade their transparency, which has helped raise the average performance of all companies in M&E study from 62% in 2005 to a current 67.5%, despite the first time inclusion of Petronas' very weak numbers. European oil companies have proven more transparent than their American counterparts. The average overall transparency score for the six European companies is nearly 80% while the three Americans only attained 65.5%. Industry-leader ExxonMobil scores only 57%, which is the same as Mexican state-owned Pemex and lower than Russia's Lukoil.
Oil companies have been regularly improving their websites as the world goes online. The key topics are corporate governance and environmental issues, followed in recent years by reports on social and employee projects. Alexey Miller, CEO of Gazprom, even addresses the company's new website as the main topic of his welcoming statement.
Under corporate governance Shell and BP, for example, publish how often each board member attended board meetings. In 2003 Lukoil created three board committees for auditing, compensation and strategy to comply with international governance standards. Proxy statements are normally revealed by all public companies. BP offers direct links to 76 national BP websites in their respective languages.
Another trend is to publish detailed and colorful sustainability, environmental and social reports. BP publishes the full report in English, German, Spanish and Russian and Petrobras has published a social responsibility report annually since 2001 while others are doing it for the second or third (e.g. Total) year. Petrobras is even increasing the pace by already having its 2005 data ready for release by mid-February of 2006. Gazprom, by comparison, has not gotten beyond publishing its 2002 data.
Most On Top in Ethics
On the average, companies scored highest under “ethics” with an average of 73.3%. Ethics in essence means having and promoting a detailed code of conduct and staying out of trouble. Companies with low scores, such as Gazprom and Petronas, largely failed to communicate and implement a code of conduct and ethics, although this is among the least expensive ways of gaining points. Top performers, such as Chevron, Statoil and Total, implemented codes explaining how employees should deal with difficult cases of bribery and conflicts of interest. Statoil's general code of ethics is 31 pages long. In addition, the company publishes codes for its financial management and suppliers, which were last updated as recently as December 2005.
Management & Excellence (M&E) was one of the first companies to research and rate companies in sustainability and ethical areas, starting in 2001. It specializes in the oil business and Latin America where it is partnered with SR Rating, one of Latin America's largest credit rating agencies. M&E markets its oil study jointly with Oil & Gas Journal Online Research Center.
The current study “World's Most Sustainable and Ethical Oil Companies” uses the M&E Facts Only™ method which consists of a list of over 280 internationally recognized standards in sustainability, corporate governance, social responsibility (CSR) and ethics customized to the oil industry. M&E surveyed all companies and researched public information services to determine actual point-by-point compliance with these standards. All percentages refer to the number of points with which a company complies out of a total of over 280. The entire study is available for sale.
For more information contact:
Oil & Gas Journal Online Research Center
Robert Beck
Manager, OGJ Online Research Center
Tel: 1-918-831-9488
Fax: 1-918-832-9521
E-mail: [email protected] or [email protected]
Web Site: www.ogjresearch.com read more

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The Mayo News (Ireland): Shell accused of ‘localising issue’

Shell accused of ‘localising issue’
Padraig Burns
THE appointment of former Chief Superintendent of the Mayo Garda Síochána, Mr John Carey (right), as as an advisor to the Corrib Gas project, has been described by the Shell to Sea campaign as a ‘strategic decision by Shell in an attempt to localise the issue’.
Dr Mark Garavan, spokesman for Shell to Sea, said the decision to appoint Mr Carey, which follows the recent appointment of journalist Christy Loftus, and former County Secretary, Padraig Hughes, as external advisors, did not affect the substantive issue of their campaign.
Dr Garavan said the group he represented did not comment on individual appointments within Shell, but he did admit that it appeared Shell had taken a strategic decision.
“If you look at the language they [Shell] have been using in their most recent press releases, you can see that they are implicitly conceding that they had lost a lot of trust locally in the area,” he told The Mayo News.
“Obviously, Shell have decided to take a strategic decision to localise the issue by their appointments in recent weeks, but they have still to address the substantive issue and until that happens we won’t be changing our approach.
“Shell must accept that the project as it stands is not viable and until that happens there can be no change. As it stands they have not indicated any change in their approach, the mediation is still stalled and there is still no sign of it restarting,” he said.
Mr Carey is a native of Bangor and his new role, which will be part-time, will see him meeting local groups and residents and conveying their hopes and concerns relating to the project to the Corrib management team. He will also be involved in informing people locally about the plans for the project as it moves forward.
His appointment has been welcomed by both Christy Loftus and the SEPIL Mayo Area Manager, Mr Mark Carrigy. Mr Loftus said John Carey will bring ‘invaluable local knowledge’ while Mr Carrigy said he was delighted that Mr Carey had agreed to assist the Corrib Gas partners as they work to regain the trust of the people of Erris and Mayo. Mr Carrigy admitted that the events of the past year had damaged the trust between the two parties.
John Carey served for nine years as Chief Superintendent of the Mayo Division and during his career he was also based in Galway, Roscommon, Laois and Offaly. He played Gaelic football for Mayo and became the first player from the county to be selected as an All-Star in 1971. read more

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MarketWatch: Shell CEO was paid $8.3M in cash, benefits shares in 2005

Mar 14, 2006
LONDON (MarketWatch) — Royal Dutch Shell PLC's chief executive was paid the equivalent of $8.3 million in cash, benefits and shares in 2005, according to the company's annual report filed with the U.S. Securities and Exchange Commission. According to the filing, Jeroen van der Veer received the equivalent of $4.3 million in cash and benefits during 2005, including EUR1.9 million in bonuses. In 2004, he was paid $3.3 million.
Van der Veer, who became CEO in 2004 following a reserves scandal, was also awarded 145,199 shares in the Anglo-Dutch major in 2005, worth an estimated $3.9 million, the document says.
News of the award comes after Shell set a new record in annual U.K. corporate profits last month, announcing full-year net profit of $25.311 billion, on higher oil and natural gas prices.
In the same SEC filing, the company said damage to onshore pipelines from hurricanes in the U.S. Gulf of Mexico caused 3,900 tonnes of oil spills, the largest being at Nairn and Pilottown in Louisiana in September.
-Contact: 201-938-5400 read more

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Royal Dutch Shell plc: Annual Reports & Accounts

Tuesday March 14, 2:29 am ET
Filing of Annual Report and Form 20-F for the Year Ended December 31, 2005 Including Supplementary Information Oil & Gas
LONDON, March 14 /PRNewswire-FirstCall/ —
On March 13, 2006 Royal Dutch Shell plc (NYSE: RDS.A, NYSE: RDS.B) filed its Annual Report on Form 20-F for the year
Separately an Annual Review and summary financial statements will be made available to shareholders in mid April, in ended 31 December 2005 with the U.S. Securities and Exchange Commission (SEC).
time for the Annual General Meeting (AGM). The Annual Reports and Accounts will be submitted for approval at the AGM on 16 May 2006.
The financial statements contained in the filing have been prepared in accordance with applicable laws in England and Wales and with International Financial Reporting Standards (IFRS) as adopted by the European Union. As applied to Royal Dutch Shell there are no material differences with IFRS, as issued by the International Accounting Standards Board. The filing has been prepared under the one-time accommodation provided by the SEC to allow, for a limited period, foreign private issuers that prepare financial statements in line with IFRS to present only one year of comparative information in their first IFRS Financial statements. Tables and disclosure that provide data over a five-year period show 2005 and 2004 on an IFRS basis and 2003, 2003 and 2001 on a US GAAP basis.
The notes to the financial statements provide a reconciliation of the balance sheet as January 1, 2004 (date of transition to IFRS) and of the Statement of Income for 2004 between US GAAP and IFRS.
The filed Annual Report on Form 20-F can be downloaded today from www.shell.com/annualreport or www.sec.gov. The full Annual Report on Form 20-F and Annual Review websites will be available in html format in mid April.
Disclaimer statement
This announcement contains forward-looking statements, that are subject to risk factors associated with the oil, gas, power, chemicals and renewables business. It is believed that the expectations reflected in these statements are reasonable, but may be affected by a variety of variables which could cause actual results, trends or reserves replacement to differ materially, including, but not limited to: price fluctuations, actual demand, currency fluctuations, drilling and production results, recovery rates, reserve estimates, loss of market, industry competition, environmental risks, physical risk, risks associated with the identification of suitable potential acquisition properties and targets and the successful negotiation and consummation of transactions, the risk of doing business in developing countries, legislative, fiscal and regulatory developments including potential litigation and regulatory effects arising from recategorisation of reserves, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, approvals and cost estimates.
Please refer to the Annual Report on Form 20-F for the year ended December 31, 2005 for a description of certain important factors, risks and uncertainties that may affect the Company's businesses. The Company does not undertake any obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or otherwise.
Cautionary Note to US Investors: The United States Securities and Exchange Commission ('SEC') permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation, such as “expected producible resources” and “amount of reserves we expect to produce”, that the SEC's guidelines strictly prohibit us from including in filings with the SEC.
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Source: Royal Dutch Shell plc read more

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The Independent: Terence Blacker: The painful truth about bloggers

The evidence suggests that this clear, babbling brook of opinion is likely to have been contaminated
Published: 14 March 2006
Certain groups of people are more likely to be annoyed by public criticism than others. Poets tend to be rather touchy. Priests will take to the pulpit at the slightest opportunity. Millwall football fans are notoriously sensitive. But no faction is quite as quick to take umbrage when it feels its group honour has been impugned than the community of bloggers. These people, whose hobby or even job it is to express opinions on internet weblogs, are surprisingly prickly when they are on the receiving end.
For the blog has become regarded, at least by blogocrats, as the ultimate in free expression. Whereas someone writing in the mainstream media – the “MSM” as it is now contemptuously known – will be cribbed and confined by fear of offending a vested interest, a brutal editor or a proprietor, the blogger, putting down his or her views without fear or favour, is as unrestricted as someone talking in the pub. The system is the free market of ideas at its purest, and those who argue otherwise are almost always hacks fearful of their dwindling influence from within a dying media establishment.
Or so the argument goes. Unfortunately, the evidence is beginning to suggest that this clear, babbling brook of individual opinion is likely to have been contaminated. The internet is the ultimate product of a post-hippie sensibility, offering both anarchy of choice and unlimited marketing opportunities. More and more people are said to be deserting traditional TV for an on-line version catering for niche specialisms. Industries like book publishing, whose slavery to the mass market has led to a creaky lack of editorial inventiveness, are likely to find that new areas of talent are appearing not on their lists but from self-publishing outfits on the web.
The blog, its champions argue, is doing the same thing for opinion. Individuals are able to communicate without working through a meddlesome intermediary. Star or nobody, political heavyweight or run-of-the-mill cyberbore: they all have a shop window for their views.
As the Metropolitan Police have just discovered, the reality behind blogging can be rather different. Over the past year or so, a number of discontented rozzers have taken to the internet and have moaned about their work. The effect has so concerned the Met that it has just banned its employees from “expressing views and opinions that are damaging to the organisation or bring the organisation into disrepute”.
There has been a mighty keening from the blogging policemen – all anonymous, of course – who believe some basic right to bitch about this and that from the perspective of an insider in the fight against crime has been traduced. “I have committed no crime. I have compromised no police operations. I have received no payment for anything published on this blog,” wrote World Weary Detective. Cough-the-Lot agreed, complaining that “in the police we are constantly reminded of diversity and human rights, and yet here are individuals being punished for penning the way it really is”. According to Bow Street Runner, blogs have revealed the truth behind the spin of the Met's PR office.
Yes, but who are these people? The most basic logic would suggest that only those who are prepared to be identified can speak with any moral authority. Anything else is anonymous whingeing and indeed might come from some sad case, or political stirrer, who is no more a policeman than I am.
The problem faced by the police and by other organisations reflects a paradox of our computerised society. The internet represents both the personal and the public. While most blogs are little more than the grumpy outpourings of an individual, some of them have considerable political and marketing power. The fact that there is no difference of category between them, one is as homely and innocent as the other, has not gone unnoticed by politicians and those in business.
Last week, it was discovered that Walmart, the large and ruthless American shopping chain, had been defended against criticism in several of the more prominent right-wing blogs. Not only were the arguments similar but so, in many cases, was the wording.
It was no accident. Walmart, under general attack – it was the liberal conspiracy in that mainstream media again – had hit on the bright idea of feeding websites deemed to be sympathetic with what the corporation called “the occasional update with some newsworthy info about the company and an occasional nugget that you won't hear about in the MSM”.
Anyone who has worked for the MSM will know that these “nuggets” appear in one's in-box every day. If one were ever tempted to push a particular product or shoehorn a paragraph from a press release into an article, the consequence would be immediate and brutal.
Bloggers, in contrast, can never be fired, no matter how badly or dishonestly they behave. Yet their influence will continue to increase because the internet has reached the many thousands of people who feel alienated from the political and media establishments. There is, genuinely, a sort of political underground at work which cannot be ignored.
But, in the blogosphere, there is no accountability. The identity of the messenger and the integrity of the message are never called into question. Behind those quirky expressions of personal opinion may lurk, undeclared, some powerful forces.
[email protected] read more

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Les Echos – France: Total in shortlist for Shell LPG activities (Total serait parmi les 4 preselectionnes pour le GPL de Shell)

Royal Dutch Shell has included the French oil group Total in a shortlist of four offers for its liquefied petrol gas activities, according to sources familiar with the matter.
The deadline for the submission of offers was Friday, and the result could be announced this week. Analysts estimate that the total assets on offer are worth more than $2bn.
Abstracted from Les Echos

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THE NEW YORK TIMES: Senate Panel to Scrutinize Big Oil Mergers, Profits

By REUTERS
WASHINGTON (Reuters) – Oil companies and their record profits come under more congressional scrutiny on Tuesday, when a Senate committee holds a hearing on the effect industry mergers have had on gasoline and other energy prices.
Executives from six major oil companies will make what is expected to be a standing-room-only appearance at the Senate Judiciary Committee hearing, where lawmakers will push for an explanation of the companies' huge profits and what they plan to do to ease consumers' soaring energy costs.
“I expect every senator to be critical of the companies on their record profits and seriously high prices at the pump,'' said an aide to Sen. Arlen Specter, the Republican chairman of the judiciary panel.
“This is not a partisan issue and everybody complains to their members of Congress when they're paying $2.50 a gallon'' for gasoline, the aide said.
Executives from oil giants Exxon Mobil Corp., Chevron Corp.,, ConocoPhillips, the U.S. units of BP Plc and Royal Dutch Shell Plc and major oil refiner Valero Energy Corp. will testify.
New Exxon Chairman Rex Tillerson plans to use the hearing as “another opportunity'' to explain to policymakers and the American public how the complex energy business works, the industry's massive projects and the time frames companies operate under, said company spokesman Mark Boudreaux.
High gasoline and oil prices helped Exxon earn more than $36 billion last year, the most ever for a U.S. company.
“We are sensitive to the prices that the general public consumers have to pay at the pump. What we're doing is focusing on what we can do to try and get more supply on the market,'' Boudreaux said.
Tillerson and the other oil company officials will testify after a panel of state attorneys general and legal experts on the industry's mergers and proposed legislation to protect consumers.
Specter will focus on his legislation that would give the government more power to stop oil and natural gas company mergers if such deals reduced available energy supplies and raised prices, and to go after companies that purposely withhold supplies from the market to make a higher profit.
The legislation would also permit the government to take legal action against the Organization of Petroleum Export Countries, or OPEC, for restricting oil supplies and fixing prices.
Jamal Qureshi, an analyst with PFC Energy in Washington, said the OPEC language is “just a populist measure — there is really no way of doing this.''
Still, he said the cartel's ministers pay close attention to such anti-OPEC actions. “They are always nervous about that — they make policy with that in mind,'' he said.
Patrick Leahy, the top Democrat on the judiciary panel, is co-sponsoring the bill.
Leahy and the committee's other Democrats will press the executives on why their companies won't use some of their profits to build refineries for making more gasoline and petroleum products, and why the companies don't have enough fuel reserves in place to deal with a supply disruption like the one that occurred with Hurricane Katrina last year that sent the average gasoline price to a record $3.07 a gallon.
Also likely to come up at the hearing is whether to impose a windfall profit tax on the oil companies that could be used for mass transit, fund alternative energy research or provide tax credits to consumers that buy more fuel efficient vehicles. Consumer groups like that idea.
“Those are not investments that Exxon Mobil and the other oil companies are ever going to make,'' said Tyson Slocum, director of energy programs at Public Citizen.
“(Oil companies) are just pursuing what is in the best interests of their shareholders, and what government needs to do is pursue the best strategy for consumers,'' he said. read more

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AFX Europe (Focus): Gaz de France seeks stake in Iran's giant South Pars gas project – report

Mar 14, 2006
PARIS (AFX) – Gaz de France seeks an 8-10 pct stake in developing Phase 11 of Iran's giant South Pars gas field, a 4-5 pct stake in a gas liquefaction plant to be built as part of the project, and a 25 year contract to buy between 2 and 3.4 bln cubic meters of gas per year from the zone, the daily Les Echos said, without citing sources.
The investment involved would be 210-265 mln eur.
Preliminary agreements were reached in December with Total and the Iranian government, with a view toward a final global agreement by mid-year.
Iran has selected Total as one of its partners to develop Phase 11 of the South Pars field. Other partners chosen were Royal Dutch Shell and Repsol YPF. read more

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Lloyds List: Shell and Statoil in gas injection link-up

Mar 14, 2006
SHELL and Statoil have agreed to invest in the world's largest offshore oil project to use carbon dioxide for enhanced oil recovery, writes Martyn Wingrove .
The $1.5bn concept involves taking CO2 from a newbuild gas-fired power plant and expanded methanol production facility at Tjeldbergodden in central Norway to pipe it to two offshore oil fields.
Shell and Statoil intend to use the CO2 to inject into the Heidrun and Draugen oilfields to enhance oil recovery from through two production platforms.
The 850 megawatt gas-fired plant will supply power to run the carbon capture plant and these two platforms in the Norwegian Sea, lowering CO2 and nitrogen oxide emissions.
Power will also be fed into the local grid, which is being stretched by growing demand in central Norway, and will be supplied to the Nyhamna plant to drive the Ormen Lange facilities.
New offshore pipelines will be required to pump CO2 to the Draugen platform and Heidrun tension-leg platform so it can be reinjected.
Shell and Statoil expect the enhanced oil recovery on these fields to produce an extra 100m to 150m barrels over seven to 10 years.
A feasibility study will be completed before the end of this year, followed by engineering studies next year and an investment decision in 2008.
If the project moves ahead the power station could begin generating electricity in 2010 with the first CO2 injected at Draugen in 2011.
The enhanced oil recovery programme at Heidrun would begin at a later date, while the whole project could be extended to other Norwegian Sea oilfields with new pipelines.
Around 2.5m tonnes of CO2 could be injected annually to reduce Norway's emissions.
This could represent 25% of the country's commitment to the Kyoto protocol on lowering greenhouse gas emissions. read more

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Financial Times: BP wins negligence case in London

By Andrea Felsted and Nikki Tait
Published: March 14 2006 02:00 | Last updated: March 14 2006 02:00
BP, the oil company, and a number of its joint venture partners yesterday won a long-running negligence case, potentially involving tens of millions of dollars, against its insurance brokers, Aon, in London's High Court.
BP had claimed that Aon's negligence left BP subsidiaries and partners such as Shell, Amerada Hess, Total, ENI and ConocoPhilips partially uninsured in respect of 12 offshore construction projects from the North Sea to Vietnam. The projects are said to have generated losses of more than US$200m, with BP claiming up to 42 per cent of that sum.
The case, heard last autumn, concerned liability only. Mr Justice Colman ruled yesterday that Aon had owed BP a duty of care over the insurance. He rejected arguments of contributory negligence on the part of BP. The parties will return to court next month to discuss a possible appeal. If the judgment stands and the parties cannot agree a settlement, a second trial to establish the precise level of Aon's liability will take place.
Aon said yesterday that it was “disappointed” with the judgment, and would attempt to appeal. “Aon does not believe this judgment will have a material effect on its consolidated financial position,” it added.Nikki Tait andAndrea Felsted, London read more

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The Independent: Burst oil pipeline causes 'catastrophe' in Alaska

By Andrew Gumbel in Los Angeles
Published: 14 March 2006
A burst pipeline in Alaska's North Slope has caused the Arctic region's worst oil spill, spreading more than 250,000 gallons of crude oil over an area used by caribou herds and prompting environmentalists again to question the Bush administration's drive for more oil exploration there.
The leak was first spotted by a British Petroleum worker 11 days ago, and was reported to have been plugged a few days later. Initial hopes expressed by BP that the spill was limited to a few tens of thousands of gallons proved to be over-optimistic. Alaska's Department of Environmental Conservation has steadily increased its estimate of the size of the spill, the latest estimate putting it at around 265,000 gallons.
The leak, whose cause is unknown, occurred in a remote part of the most sparsely populated state in the United States, and it remains to be seen what damage, if any, it has done to ecosystems. It does, however, give grist to groups who have challenged Washington's assertion that oil can be prospected and shipped while leaving only the gentlest of “footprints” on the landscape.
“This historic oil spill is a catastrophe for the environment,” Natalie Brandon, of the Alaska Wilderness League, said in a statement. “Tone-deaf politicians in Congress should now stop trying to push for more drilling through sneaky manoeuvres … The fact that the oil spill occurred in a caribou crossing area in Prudhoe Bay is a painful reminder of the reality of unchecked oil and gas development across Alaska's North Slope.”
The biggest battle has been over the fate of the Arctic National Wildlife Refuge, also on the North Slope, which the White House wants to open up. The initiative, championed from the moment the Bush administration took office in 2001, has been consistently blocked by Congress but is periodically revived.
A second battle, meanwhile, is taking place in a previously untouched corner of the National Petroleum Reserve on the North Slope. The Bush administration has allowed oil companies to prospect for oil and gas in an area covering 389,000 acres. Environmental groups have responded with a federal lawsuit, filed last Friday, in which they contend that the Department of the Interior has violated the Endangered Species Act and other laws in an area noted for its flocks of migratory geese.
It is not just environmentalists who oppose the administration's plans. Several prominent energy analysts, as well as Washington politicians, argue that the likely yield in unexplored areas of the North Slope is not large enough to justify the intrusion.
Alaskan politicians and industry lobby groups are heavily in favour of expanding exploration as it would bring jobs and other benefits to the state economy. The Bush administration, meanwhile, argues that further domestic exploration is essential if the United States wants to decrease its dependence on oil and gas from the Middle East.
Accidents and leaks have periodically occurred on the North Slope, and along the trans-Alaska pipeline that takes crude from Prudhoe Bay across two mountain ranges to the port of Valdez on the shores of the North Pacific. Saboteurs blew up a section of pipeline shortly after it opened in the 1970s, starting a major spillage. A hunter accidentally fired into the pipeline five years ago, causing $7m (£3.6m) worth of damage. read more

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