News and information on Shell Plc
Nick Fletcher
Saturday December 30, 2006
Oil prices eased below $60 in the US for the first time for a month leaving BP, 4p lower at 567.5p, and Royal Dutch Shell down 7p to £17.85. Shell was also hit by reports the company and its partners would have to stump up a third of the $10bn overrun on the controversial Sakhalin-2 gas project in eastern Siberia.
http://business.guardian.co.uk/marketforces/story/0,,1980260,00.html
By Josephine Moulds
Last Updated: 12:58am GMT 30/12/2006
FTSE falls on a quiet day ahead of break
City trader
Oil stocks were down on a weaker crude price as traders disregarded a sharp drop in US crude stockpiles on Thursday night. BP slid 4 to 567½p. Royal Dutch Shell was hit by news that it will be made to foot the bill for huge cost overruns at the Sakhalin-2 oil and gas project in Russia together with its two Japanese partners. It retreated 12p to £17.90. BG Group, which on Thursday announced it had bought a US power plant, lost 4½ to 693p.
• Shares of Exxon Mobil, the world’s biggest corporation, had their largest annual increase since 1980 as the company boosted oil production and crude prices rose to an all- time high.
• Royal Dutch Shell will cut its proven oil and gas reserves by more than 4pc when it gives up half its stake in Russia’s Sakhalin-2 venture, analysts said.
• Gazprom, Russia’s natural-gas export monopoly, is continuing talks with Belarus to avoid a Jan. 1 cutoff that could curb deliveries to Europe.
By Stephen Voss and Torrey Clark
Dec. 29 (Bloomberg) — Royal Dutch Shell Plc, Europe’s largest oil company by market value, will cut its proven oil and gas reserves by more than 4 percent when it gives up half its stake in Russia’s Sakhalin-2 venture, analysts said.
The equity transfer to state-run Russian energy company OAO Gazprom is expected to be completed by the end of February, and may not be reflected in Shell’s reserves number for the end of 2006. Shell reports proven reserves once a year, usually around March, giving yearend totals for various geographical areas.
By Jim Polson
Dec. 29 (Bloomberg) — Centurion Energy International Inc., the Canadian oil and gas producer that’s being acquired by a United Arab Emirates-based energy company, announced the termination of plans by Royal Dutch Shell Plc to help it explore for natural gas in Egypt’s Nile Delta.
The two companies mutually agreed to end an accord under which Shell would have paid $15 million for a 50 percent stake in two gas blocks, West Manzala and West Qantara, Calgary-based Centurion Energy said in a statement today.
WASHINGTON, Dec. 27 /PRNewswire-USNewswire/ — FreeEnterpriser.com today announced the “Five Worst CEOs of 2006” — a review of the worst CEOs of the year.
“Despite this year’s bull market, 2006 was a banner year for CEOs who are undermining free enterprise, free markets and capitalism,” said Tom Borelli, editor of FreeEnterpriser.com.
“Instead of relying on innovation and unfettered competition as guiding principles for maximizing shareholder value, the “Five Worst CEOs of 2006″: (1) sought government regulation as a means of generating profits; (2) used shareholder assets to advance their personal hobbies and enhance their stature in elite social circles; and (3) deflected criticism by allowing anti-business activist groups to hijack company resources and influence business decisions,” said Steve Milloy, executive director of the Free Enterprise Education Institute.
Published: Dec 28, 2006
SAKHALIN II PSA: EXTRACT: ‘Delyagin alleged that the deal was murky and could discredit Shell if investigated properly. ‘
The director of the Moscow-based Institute of Problems of Globalization, Mikhail Delyagin, has sharply criticized Gazprom’s decision to raise the price for Russian gas exported to Belarus 4.3-fold from 1 January 2007.
“The only thing our government has on its mind is cash,” Delyagin said in a live interview broadcast by Ekho Moskvy radio on 28 December. “These people have learnt no lesson” from the gas conflict with Ukraine in the beginning of 2006, he went on to say. Belarusian President Alyaksandr Lukashenka will simply start to siphon off gas intended for Europe. It would be easier for Minsk than it was for Kiev, because Lukashenka, unlike the present Russian or Ukrainian leadership, “does not need a house on Sardinia or in Paris but fights for the interests of his country,” he said.
Published: Dec 28, 2006
Royal Dutch Shell PLC announced Thursday that one of its Brazilian offshore oil fields is commercially viable and that two deep-water areas of the block have been identified for development.
Europe’s second-largest oil company did not say when production would begin in the BS-4 block or offer yield estimates, but the field has estimated reserves of about 300 million barrels of very heavy crude.
Shell is the lead operator of the block with a 40 percent stake. Brazil’s state-owned Petroleo Brasileiro SA also has a 40 percent stake, and U.S.-based Chevron Corp. holds 20 percent.
By: DAN CATERINICCHIA,
Published: Dec 28, 2006
The kidnappings and armed attacks plaguing oil companies operating in Nigeria’s oil-rich Niger delta are among the top security challenges U.S. businesses are likely to face in 2007, a State Department official said Thursday.
“We’re keeping our eye on Nigeria right now,” Doug Allison, a special agent with State’s Bureau of Diplomatic Security, said in a phone interview. “That situation seems to be not getting any better.”
EXTRACT: After the recent tensions over the Sakhalin development between Shell and Gazprom, there were doubts about whether Russia would be willing to develop stable relationships with foreign investors, a fear that was dismissed by Stephen O’Sullivan of Deutsche Bank in Moscow, who has followed the battle closely. The scale of pressure on Shell developed after it announced that the cost of the project, which the Russian state must first pay off before it receives a full dividend, shot up from $10 to $22 billion, he points out. “Along comes Shell with this huge cost overrun, so it gave the government a stick,” he argues.
Shell has hired the former US interior secretary Gale Norton as general counsel for its “unconventional resources” division. Ms Norton will provide and co-ordinate legal services for the division, which develops technology to get oil from sources such as oil shale.
By Barney Jopson
Published: December 29 2006 02:00 | Last updated: December 29 2006 02:00
The average size of fines doled out by the City watchdog dropped in 2006, but the total number of penalties edged up from the previous year.
The Financial Services Authority collected just over £13m in fines from 25 cases this year, with the average penalty working out at around £520,000.
The average fine in 2005 was about £860,000 as the regulator collected £16.3m from 19 cases.
The figures reflect the performance of the FSA’s en-forcement division in its first full year under the leadership of Margaret Cole, a litigator recruited from White & Case.
By Chris Hughes
Published: December 29 2006 02:00 | Last updated: December 29 2006 02:00
Sakhalin throws up a fresh disappointment
Shell suffered a blow when it was forced to surrender control of Russia’s Sakhalin-2 oil field to state-backed Gazprom last week. Now the Anglo-Dutch oil group faces fresh embarrassment in defeat.
To re-cap, Shell sold half of its 55 per cent stake in Sakhalin to Gazprom to revive the project that Russia had grounded citing environmental reasons. The price Shell received – following months of wrangling – was better than many had expected. That helped Shell preserve some dignity despite losing control.
By Arkady Ostrovsky in Moscow and Ed Crooks in London
Published: December 28 2006 18:44 | Last updated: December 28 2006 18:44
Royal Dutch Shell and its two Japanese partners are to be made to share the burden of the huge cost overruns of Sakhalin-2, it emerged on Thursday, in news that cast a less favourable light on their deal to cede control of the project to Gazprom.
Just days after confirming that Russia would pay the companies $7.45bn to establish its controlling stake in the project, the government said it would require the three foreign owners to meet $3.6bn of the additional costs of Sakhalin-2 themselves.
Last Updated: 1:34am GMT 29/12/2006
• Centrica, the UK’s biggest energy supplier, said four employees were among six people who died in a helicopter crash this week in the Irish Sea, in Morecambe Bay off the coast of north-west England.
• Gazprom, Russia’s natural-gas export monopoly, is in talks with Belarus to avoid a possible January 1 halt in shipments that would cut deliveries to Europe for the second time in a year. Belarus has threatened to block supplies after the price for gas for itself rose.
(Paying the cost overruns, part of a secret protocol, will allow spending on the Sakhalin project to be increased)
By James Quinn
Last Updated: 1:34am GMT 29/12/2006
Royal Dutch Shell and its two Japanese partners are to be made to foot the bill for huge cost overruns at the Sakhalin-2 oil and gas project in Russia.
Shell – along with partners Mitsui and Mitsubishi – are set to cover $3.6bn (£1.8bn) of costs on the project just a week after agreeing to sell half their stakes to Russia’s Gazprom for $7.45bn in cash.
Paying the cost overruns, part of a secret protocol, will allow spending on the Sakhalin project to be increased
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