The Sakhalin Papers LXIII: The Reserves Ledger — Did Shell Really Lose 1.06 Billion Barrels?
In March 2008, the consequences of Shell’s surrender of control at Sakhalin II surfaced in the language oil companies understand best: proved reserves. Contemporary reports said roughly 1.1 billion barrels of oil equivalent were disappearing from Shell’s books. Shell’s own annual report contained two striking figures — 658 million boe and 402 million boe — which, when added together, appeared to support that conclusion. But they did not describe the same thing. One figure represented minority interests disappearing from a consolidated subsidiary; the other represented reserves being transferred into the equity-accounted investment column. Shell’s actual reduction in proved reserves attributable to its shareholders from the Sakhalin transaction was approximately 402 million boe. The distinction is accounting — but it is not merely cosmetic.
Archive reference: SLF-2007-073 Collection: The Sakhalin Papers Principal authenticated records: Royal Dutch Shell plc Annual Report and Form 20-F 2006; Royal Dutch Shell plc Annual Report and Form 20-F 2007 Contemporaneous reporting: Financial Times; JP Morgan/Hemscott; The Observer; Bloomberg; Thomson Financial/AFX; Energy Intelligence Judicial context:Export Credits Guarantee Department v Friends of the Earth [2008] EWHC 638 (Admin) Evidence standard: Shell’s reserve figures and accounting classifications are treated as corporate facts. Contemporary descriptions of a 1.1-billion-barrel “loss” are attributed to the analysts and journalists who used them. No accounting reclassification is treated as a physical disappearance of hydrocarbons. The distinction between reserves surrendered economically and reserves merely moved between reporting categories is maintained throughout.read more
By Marketing Week
Shell UK dealers and institutional shareholders have received letters from sales promotion company Don Marketing accusing Shell of a cover-up involving a “flawed” promotion.
Don and Shell are involved in a long-running legal dispute, due to come to court in February. Don has issued three high court writs and county court proceedings against Shell, alleging the wrongful use of retail promotions developed by Don Marketing. Shell has settled one of the three writs out of court.
Now Don has formed the Shell Corporate Conscience Pressure Group, put ads in the petrol trade press rallying support from others who have had dealings with the firm and written to institutional investors. Those who have received a letter include the pension fund manager of The Equitable Life Assurance Society, a heavy investor in Shell.read more
A story highlighted by Campaign is worth revisiting because it captures something larger than a mere advertising stunt. It shows how Shell deliberately used pop music, celebrity culture and youth-oriented digital marketing to present itself as a company associated with the future of clean energy rather than simply as one of the world’s biggest oil and gas businesses. That makes it less a quirky campaign anecdote than a revealing case study in corporate image management.
In late 2017, Shell unveiled a glossy new chapter in its global #makethefuture campaign: a music video for “On Top of the World” featuring an international line-up of artists including Jennifer Hudson, Pixie Lott, Luan Santana, Yemi Alade and Monali Thakur.read more
Shell doubles down on Canada: LNG Canada Phase 2 turns Kitimat into a 28-million-tonne export hub
Shell has taken the final investment decision on LNG Canada Phase 2, committing with its partners to double the capacity of the Kitimat, British Columbia, export terminal from 14 million to 28 million tonnes of LNG a year. The decision substantially deepens Shell’s exposure to Canadian natural gas only weeks after it completed its acquisition of ARC Resources, adding roughly 370,000 barrels of oil equivalent a day of Canadian production. Shell Canada
For Shell, this is not a peripheral investment. The company owns 40% of LNG Canada, alongside PETRONAS with 25%, PetroChina 15%, Mitsubishi 15% and KOGAS 5%. Phase 2 will add two further liquefaction trains, an additional LNG storage tank, condensate storage, another loading berth and expanded utilities. The 670-kilometre Coastal GasLink pipeline will also be expanded through five new compressor stations. Commercial operations are expected in the early 2030s. Shell Canadaread more
The Sakhalin Papers LXII: The Fine Print — $4.1 Billion, a $19.4 Billion Budget and the “Economic Balance” Agreements
The Kremlin agreement of December 2006 determined who would control Sakhalin II. The transaction completed on 18 April 2007 determined what that change meant in money, accounting and project economics. Shell received approximately $4.1 billion, surrendered half its interest, stopped consolidating Sakhalin Energy as a subsidiary and accepted Gazprom as majority shareholder. On the same day, Russia approved the revised Environmental Action Plan, the project’s amended development budget was approved, and Shell later disclosed that additional agreements had been signed with the Russian Government “addressing the economic balance of the project.” Those facts are documented. The surviving public record is much less explicit about what those additional agreements contained.
Archive reference: SLF-2007-072 Collection: The Sakhalin Papers Principal authenticated records: Royal Dutch Shell plc Form 20-F for 2007; Shell SEC-filed 2007 interim financial statements; Shell announcement of 18 April 2007 Government/project record: approval of the amended Sakhalin II development budget and revised Environmental Action Plan Contemporaneous reporting: Reuters; Oil & Gas Journal; contemporary project and financial reporting Later judicial context:Export Credits Guarantee Department v Friends of the Earth [2008] EWHC 638 (Admin) Evidence standard: transaction figures and accounting treatment are treated as established corporate facts. Statements concerning Russian motives or coercion remain attributed assessments. The phrase “economic balance of the project” is Shell’s own description; no interpretation of undisclosed agreement terms is presented as fact.read more
The Sakhalin Papers LXI: The Kremlin Deal — $7.45 Billion and the Day Shell Agreed to Give Up Control
On 21 December 2006, after months of environmental enforcement, permit uncertainty, cost disputes and negotiations with Gazprom, Shell and its Japanese partners signed a protocol inside the Kremlin. Gazprom would pay $7.45 billion for 50 per cent plus one share of Sakhalin Energy. Shell’s 55 per cent interest would be halved. President Vladimir Putin described Gazprom’s entry as a corporate decision and, at the same meeting, said the project’s fundamental problems could be considered resolved. The timing generated immediate allegations that regulatory pressure had been used as commercial leverage. Shell did not adopt that interpretation. Nor did any court identified in this archive adjudicate such a bargain. What the documents do establish is unusually stark: the ownership dispute, the project-budget dispute and the environmental crisis converged on the same day.
Archive reference: SLF-2007-071 Collection: The Sakhalin Papers Principal authenticated record: Royal Dutch Shell plc Form 6-K filed with the US Securities and Exchange Commission, December 2006; Royal Dutch Shell plc Annual Report and Form 20-F 2007 Corporate environmental record: Shell Sustainability Report 2006 Government and institutional record: contemporaneous Kremlin statements; later House of Commons Foreign Affairs Committee report Contemporaneous reporting:The Guardian, Wall Street Journal, Bloomberg, Radio Free Europe/Radio Liberty, Oil & Gas Journal Later judicial context:Export Credits Guarantee Department v Friends of the Earth [2008] EWHC 638 (Admin) Additional contemporary record: Shell’s January 2007 response to the Donovan account, subsequently preserved by Legal 500 Evidence standard: transaction terms are treated as corporate facts; Russian environmental allegations as allegations; descriptions of administrative pressure are attributed to journalists or Parliamentary findings; the coincidence of regulatory and commercial events is not treated as proof of a secret quid pro quo.read more
The Sakhalin Papers LX: The Permit War — When Shell’s Internal Emails Reached Russia’s Environmental Watchdog
In September 2006, Russia moved against the environmental approval underpinning Sakhalin II Phase 2. Shell-led Sakhalin Energy said the approval had survived a Russian court challenge only weeks earlier and denied there were lawful grounds for revocation. Then another evidential strand entered the dispute. Internal Shell emails from 2002 — expressing concern about seismic faults, well design and a project being “schedule driven” — were supplied by John Donovan to Russian environmental official Oleg Mitvol. Contemporary Interfax and Argus reporting independently recorded that Mitvol received the material and sought answers from Sakhalin Energy. The emails did not prove environmental catastrophe, nor has any court identified here adjudicated their technical implications. But they became part of the regulatory confrontation at precisely the moment Shell was fighting to retain control of its largest Russian investment.
Archive reference: SLF-2007-070 Collection: The Sakhalin Papers Principal corporate records: Shell/Sakhalin Energy statements; Shell internal Bouman–Van Spronsen emails; Royal Dutch Shell SEC filing of 21 December 2006 Regulatory record: Russian Ministry of Natural Resources/Rosprirodnadzor statements as reported contemporaneously Contemporaneous reporting: Reuters, Interfax, Oil & Gas Journal, The Guardian, Dow Jones/MarketWatch and Argus Archive correspondence: John Donovan communications with Oleg Mitvol, August–November 2006 Later judicial context:Export Credits Guarantee Department v Friends of the Earth [2008] EWHC 638 (Admin) Evidence standard: Russian allegations, Sakhalin Energy responses, internal technical concerns, Donovan commentary and journalistic interpretation are kept separate. The transmission of the Shell emails to Rosprirodnadzor is documented; it is not inferred that those emails caused the Russian regulatory campaign or the subsequent transfer of control to Gazprom.read more
The Sakhalin Papers LIX: The 120-Day Test — When Shell’s $20 Billion Project Was Put Out for Public Judgment
In December 2005, the European Bank for Reconstruction and Development decided that Sakhalin II’s environmental and social documentation was sufficiently developed to enter formal public consultation. That was not project approval and it was not a loan decision. During the following 120 days, critics challenged the project in London, Moscow, Sakhalin and Hokkaido over whales, salmon rivers, seismic risk, oil-spill preparedness and consultation itself. Sakhalin Energy maintained that it was complying with Russian law and improving its environmental controls. Then, before the financing question could be resolved, the argument changed character. Russian regulators moved against a crucial environmental approval, Gazprom was seeking entry into the project, and EBRD said the resulting legal uncertainty prevented it from progressing its financing decision.
Archive reference: SLF-2007-069 Collection: The Sakhalin Papers Principal institutional record: European Bank for Reconstruction and Development Sakhalin II records and Independent Recourse Mechanism file Authenticated corporate record:The Shell Sustainability Report 2006 Contemporaneous reporting: AFP, Oil & Gas Journal, RIA Novosti, The Guardian, El País Campaign submissions: WWF, Friends of the Earth, The Corner House and Friends of the Earth Japan Later judicial context:Export Credits Guarantee Department v Friends of the Earth [2008] EWHC 638 (Admin) Evidence standard: EBRD determinations are distinguished from campaign-group interpretations of them. Sakhalin Energy statements are attributed to the company. Russian environmental allegations are distinguished from contemporaneous claims that regulatory action was being used to influence Gazprom’s entry into the project. No court identified in this file determined that the 2006 Russian enforcement campaign was either fabricated or politically motivated.read more
The Netherlands wants private energy companies to shoulder more of the cost of keeping enough gas in storage for winter — as the country confronts the expensive consequences of becoming increasingly dependent on imported natural gas and LNG.
According to DutchNews, the Dutch government is considering making commercial energy suppliers responsible for building up their own strategic gas reserves rather than continuing to rely so heavily on the government-backed company Energie Beheer Nederland (EBN).read more
Shell Monaca Gets New Air Quality Approval — Weeks After $15 Million Pollution Settlement
Shell’s giant plastics complex in Pennsylvania has received another significant environmental approval — just weeks after the company agreed to a $15 million settlement over air-quality violations at the same facility.
The Pennsylvania Department of Environmental Protection has issued Air Quality Plan Approval PA-04-00740D for Shell Polymers Monaca, the huge ethane-cracker and polyethylene complex in Beaver County.
On its face, this is a permit story.
Placed alongside the plant’s recent history, however, it becomes rather more interesting.read more
The Sakhalin Papers LVIII: The Audit After the Spill — What Shell’s Lenders Were Being Told About Sakhalin II
In December 2005, an independent lenders’ audit of Sakhalin II Phase I entered the documentary record. A later German parliamentary motion, citing the report by name, said that two-thirds of 90 matters examined produced negative results concerning compliance with environmental standards. A separate submission by WWF, Friends of the Earth and The Corner House said the same audit criticised management of oil-spill response equipment and found that materials used after the Cristoforo Colombo accident had not been replaced. The audit itself has not been located in the publicly accessible sources reviewed for this file. Those descriptions must therefore remain attributed. But Shell’s own 2005 Sustainability Report independently acknowledges another serious compliance problem: contractors had not always followed the agreed safeguards for environmentally sensitive river crossings, forcing Sakhalin Energy to halt its winter work programme, retrain contractors and tighten monitoring.
Archive reference: SLF-2007-068 Collection: The Sakhalin Papers Principal audit cited in the record:2005 Lenders Tier III HSE Audit for Phase One, RSK ENSR, December 2005 Authenticated corporate source:The Shell Sustainability Report 2005 Lender records: European Bank for Reconstruction and Development Phase I project record and 2005 Annual Report Contemporaneous reporting:The Observer, June 2005; Financial Times, December 2005 Parliamentary records: German Bundestag Drucksache 16/1668; UK House of Commons Environmental Audit Committee evidence Judicial record:Export Credits Guarantee Department v Friends of the Earth [2008] EWHC 638 (Admin) Evidence standard: The underlying RSK ENSR audit has not been located in the publicly available record examined here. Statements about its findings are therefore attributed to the organisations and parliamentarians who cited it. Shell and lender statements are identified as such. No court ruled on the findings of the December 2005 audit.read more
Shell and Partners Edge Toward Doubling LNG Canada — Just Weeks After Shell’s $16.5 Billion ARC Resources Bet
Shell and its partners appear to be moving rapidly towards one of the biggest LNG investment decisions in Canada since the original LNG Canada project was sanctioned.
According to a new report carried by the Financial Post, shareholders in the Shell-led LNG Canada project are poised to approve a doubling of the Kitimat export terminal’s capacity, potentially as soon as next week.
If the reported decision goes ahead, LNG Canada’s maximum production capacity would rise from approximately 14 million tonnes per annum to 28 million tonnes per annum.read more
Shell is selling billions of dollars of assets while simultaneously making one of its biggest recent acquisitions — a striking illustration of how Chief Executive Wael Sawan is reshaping the energy giant.
A new Energy Intelligence analysis reports that Shell has raised around $4 billion from divestments since June, helping provide financial firepower following its acquisition of Canadian producer ARC Resources and supporting the company’s continuing emphasis on shareholder returns.
The interesting story is not any single disposal.
It is the scale of the portfolio reshuffle taking place behind the familiar Shell emblem.
Sell here, buy there
Shell completed its acquisition of ARC Resources on 2 September 2026.
The Sakhalin Papers LVII: The Spill Before the Whale Fight — Cristoforo Colombo, Kholmsk and Shell’s Emergency System Put to a Real-World Test
On 8 September 2004, Typhoon Songda drove the dredger Cristoforo Colombo aground only metres from the shore at Kholmsk. The vessel was working within the Sakhalin II construction chain. Fuel tanks ruptured, oil reached the sea and shoreline, Russian prosecutors opened a criminal investigation, and environmental organisations demanded that Shell halt marine work. Sakhalin Energy insisted that the vessel was neither owned nor directly contracted by the company and that its emergency organisation responded rapidly. A later company presentation provides something unusually valuable: an hour-by-hour response chronology. It also revises the amount of oil said to have escaped dramatically downward from the roughly 190–200 tonnes reported at the time to a final company estimate of 28 tonnes.
Archive reference: SLF-2007-067 Collection: The Sakhalin Papers Principal authenticated records: Sakhalin Energy 2004 Annual Review; Sakhalin Energy presentation, Cristoforo Colombo Incident — 8th September 2004 Contemporaneous reporting: Energy Intelligence, Kommersant and contemporary Russian reporting Legal record: Sakhalin environmental prosecutor’s criminal investigation under Article 252(2) of the Russian Criminal Code; subsequent civil claim against European Dredging Company Related archive evidence: Rick Steiner’s 1999 Sakhalin oil-spill recommendations and the 2004–2005 environmental controversy Evidence standard: Initial spill-volume estimates are distinguished from Sakhalin Energy’s later estimate. Statements by environmental organisations are attributed to them. Company response claims are tested where possible against Sakhalin Energy’s own detailed incident chronology.read more
The Sakhalin Papers LVI: Before the Whale Panel — Rick Steiner, Exxon Valdez and the 78 Warnings Shell Faced Before Sakhalin II Phase 2
Yesterday’s file ended with Rick Steiner walking away from the scientific process surrounding Sakhalin II in August 2005. But that was not the beginning of his involvement with Sakhalin. Six years earlier, before Shell became the dominant shareholder and before the enormous Phase 2 development was sanctioned, Steiner and two fellow specialists had already examined the island’s oil industry. Their 1999 report contained 78 recommendations concerning public oversight, environmental monitoring, tanker safety, spill prevention, emergency response and liability. Steiner also delivered a separate warning based on a disaster he knew at first hand: Exxon Valdez.
Archive reference: SLF-2007-066 Collection: The Sakhalin Papers Principal historical record: Dan Lawn, Rick Steiner and Jonathan Wills, Sakhalin’s Oil: Doing It Right, 1999 Supporting contemporary record: Rick Steiner, Oil Spills: Lessons from Alaska for Sakhalin, Hokkaido University Slavic Research Center, July 1999 Corporate context: Shell held 25% of Sakhalin Energy in 1999; it subsequently acquired Marathon’s 37.5% interest and became the dominant shareholder Later corroborating records: UK House of Commons Environmental Audit Committee evidence; environmental-finance assessments; contemporary academic and industry records Evidence standard: The criticisms and risk assessments made by Steiner, Lawn and Wills are attributed to their authors. They were expert recommendations, not findings by a court or regulator. Later events are not presented as proof that any particular warning would necessarily have prevented a particular incident.read more
Sir Henri Deterding, the controversial and outspoken founder of Royal Dutch Shell, now haunts the website. Wise to all the knowledge of Shell, and its shellanigans, he delivers informative and satirical insight to anything about Shell. He's a grumpy old sod, so you'll have to excuse his bluntness.
Click the big chat-bubble (bottom-right of the website)to ask Sir Henri a question. Enjoy!
SHELL EXECUTIVES AT THE CENTER OF A SCHEME TO STEAL $1.3 BILLION FROM NIGERIA’S PEOPLE
SHELL ADMITS DEALING WITH NIGERIAN MONEY LAUNDERER – BBC NEWS
SHELL, ENI AND NIGERIAN OFFICIALS IN OPL 245 CORRUPTION SCANDAL
INVESTIGATION OF OPL 245 NIGERIAN OIL CORRUPTION SCANDAL
DUTCH EARTHQUAKES CAUSED BY SHELL/EXXON
SHELL KILLS FOR OIL IN NIGERIA
SHELL LIED ABOUT CLEANING UP OIL IN NIGER DELTA
SHELL SPIES INFILTRATED NIGERIAN GOVERNMENT
LEGO DROPS SHELL OVER GREENPEACE OIL SPILL VIDEO
SHELL ARCTIC DRILLING ACCIDENTS
SHELL KNEW ABOUT CLIMATE CHANGE DECADES AGO
ROYAL DUTCH SHELL FOUNDER SIR HENRI DETERDING, NAZI FINANCIER
JOHN DONOVAN PROMOTIONAL GAMES FOR SHELL AND OTHER CLIENTS
Listen and read proof in audio and transcript form of Shell CEO Ben van Beurden’s cover-up tactics in the OPL 245 Nigerian corruption scandal. The instruction given by him in the covertly recorded call to CFO Simon Henry was at odds with Shell’s claimed core business principles. Cover-up and obstruction, instead of transparency and integrity, says Shell critic John Donovan
The content below is sourced from current verifiable customer reviews of Shell Energy published on Trustpilot.
Extremely slow broadband for 10 months, not fixed.I have had slow broadband well below the guaranteed speed for 10 months and Shell Energy have not been able to fix it.They have tried sending about 4 or 5 engineers but have not fixed the problem.Gurps, who I have been dealing with most recently, has been friendly and polite, alth… Read more
I ordered shell energy broadband on nov 2. I was promised connection the following week. They initiated the direct debit. I called the following week and was told router would arrive on 13 and service would go live on 17. No further email or communication until 20 when I was told service would start on 30th. Spent 10 minutes waiting on phone line and spoke to a polite assistant who was absolutely useless in solving my problem. Avoid this unprofessional and chaotic… Read more
Shell Energy Broadband Service is Appalling
The worst ever
I used shell broadband. It was by far the worst broadband provider ever! The internet did not work most days. I had their super fast broadband and it dropped out constantly. Watching a movie was awful with the constant buffering. Customer support was super slow. Now their going to charge me for the useless router which I have sent back.
Date of experience: 21 November 2023
By far the worst broadband provider ever!
The worst ever
I used shell broadband. It was by far the worst broadband provider ever! The internet did not work most days. I had their super fast broadband and it dropped out constantly. Watching a movie was awful with the constant buffering. Customer support was super slow. Now their going to charge me for the useless router which I have sent back.
Date of experience: 21 November 2023
By far the worst broadband provider ever!
OVER 500 EXTERNAL PUBLICATIONS CITING OUR SHELL WEBSITES
See our link list of over 500 articles by the FT, Wall Street Journal, Reuters, Bloomberg, Forbes, Dow Jones Newswires, New York Times, CNBC etc, plus UK House of Commons Select Committee Hansard records, information on U.S. Securities & Exchange Commission websiteetc. all containing references to our Shell focussed websites, or our website founders Alfred and John Donovan. Includes TV documentary features in English and German, newspaper and magazine articles, radio interviews, newsletters etc. Plus academic papers, Stratfor intelligence reports and UK, U.S. and Australian state/parliamentary publications, also citing our Shell websites. Click on this link to see the entire list, all in date order with a link to an index of over 100 books also containing references to our non-profit websites and/or our activities.
John Donovan, the website owner
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This is an in-person event if something of interest. Ticket details are here:
Shell doubles down on Canada: LNG Canada Phase 2 turns Kitimat into a 28-million-tonne export hub
