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The Independent: BP and Shell chiefs take home £13m after surge in oil prices

By Michael Harrison, Business Editor
Published: 15 March 2006
BP's chief executive Lord Browne of Madingley took home a total of £9.3m last year – more than double the £3.98m collected by Jeroen van der Veer, his counterpart at Royal Dutch Shell, even though it made bigger profits than BP.
The pay of the two men was bolstered by record oil prices, bumper bonuses linked to company performance and increased payments into their respective pension pots, and confirmed them as being among Britain's best-remunerated executives.
Lord Browne's £9.3m pay packet for 2005 compares with one of £6.8m for the previous year. His annual performance bonus fell from £2.28m to £1.75m, partly due to the blast at BP's Texas refinery last year which killed 13 workers. But he more than made up for this through an increase in his bonus shares payment under BP's long-term incentive scheme from £1.9m to £3.2m.
In addition, the value of Lord Browne's pension pot leapt by £2.8m to just under £20m. Although still two years away from retirement, he has already amassed a pension worth £991,000 a year.
For the current year, he is being paid a basic salary of £1.486m – up from £1.45m in 2005 – and has provisionally been awarded a further 2 million performance shares which will vest in 2008 just before he reaches retirement age.
Mr Van der Veer's basic pay and annual bonus at Shell went up from £1.8m to £2.38m, including an annual bonus of £1.33m. In addition, he received a £1.48m top-up into his pension pot. The pay increase came after a tumultuous year during which the Anglo-Dutch company sought to put its reserves reporting scandal behind it by ditching almost a hundred years of tradition and becoming a unified company with a single board, headquarters and stock market listing.
BP's annual report and accounts also show that Dick Olver, a former senior director of the company and now chairman of the defence contractor BAE Systems, received £300,000 in consultancy fees in relation to its activities in Russia, where BP has a 50 per cent stake in the joint venture TNK-BP.
Peter Sutherland, the chairman of BP, saw his salary rise from £390,000 to £500,000, putting him among an elite band of FTSE 100 chairman earning half a million pounds or more a year.

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