JOHN DONOVAN, JANUARY 16. 2014 ARTICLES

Shell eyeing job cuts at Geelong Refinery

Jan 16th, 2014 

by John Donovan. 

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Shell’s refusal to guarantee the future of its Geelong refinery has led Australian Workers Union Victorian secretary Ben Davis to warn that the company will axe jobs whether it finds a buyer for the asset or not…

16 Jan, 6:57 AM

Shell’s refusal to guarantee the future of its Geelong refinery has led Australian Workers Union Victorian secretary Ben Davis to warn that the company will axe jobs whether it finds a buyer for the asset or not, The Australian reports.

According to the newspaper, Mr Davis lashes governments for failing to do enough to save the up to 700 jobs he expects could be cut.

“We are expecting heavy losses regardless of the outcome of the sale. The question is when and how many, not if, jobs will be lost,” Mr Davis warned.

The Australian reports Shell refused to answer questions on the future of its refinery in Geelong, which was up for sale last year.

SOURCE

Posted in: Australia, Oil, Royal Dutch Shell Plc, Shell Job Cuts.
Tagged: Australia · Oil · Royal Dutch Shell Plc

Dutch to Announce Decision on Groningen Gas Soon

Jan 16th, 2014 

by John Donovan. 

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AMSTERDAM, Jan 16 (Reuters) – The Dutch government is close to announcing a decision to cut production at the huge Groningen gas field because of concerns about the risk of earth tremors, local media reported on Thursday.

The gas field near Slochteren in the north of the country – one of the world’s largest gas fields – is operated by a joint venture between Royal Dutch Shell and ExxonMobil called Nederlandse Aardolie Maatschappij BV (NAM).

FULL ARTICLE

Posted in: Environment, Exxon Mobil, Gas, Royal Dutch Shell Plc.

Huge Changes Taking Place At Royal Dutch Shell Plc

Jan 16th, 2014 

by John Donovan. 

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The FTSE 100 has risen 53% during the last five years, however, Royal Dutch Shell  one of the index’s largest constituents, has underperformed by a staggering 27%. And it’s not just Shell’s shares that have been underperforming. Indeed, according to the Financial Times, around one third of Shell’s assets, are not producing a positive return-on-investment. The assets dragging on Shell’s balance sheet include the company’s $8 billion share in the huge Kashagan oilfield, half of the company’s shale oil business within the United States (worth a total of $24 billion) and numerous downstream assets. Time to do some pruning…

By Rupert Hargreaves – Thursday, 16 January, 2014

The FTSE 100 has risen 53% during the last five years, however,Royal Dutch Shell  one of the index’s largest constituents, has underperformed by a staggering 27%.

What’s more, compared to its larger peers, Exxon Mobil andChevron, Shell’s shareholder returns have been less than impressive. In particular, aside from the company’s dividend yield, which is around the same as the industry average, since introducing a script dividend back during 2010 Shell has issued around $4 billion more stock than it has brought back.

It’s not just the company’s shares

And it’s not just Shell’s shares that have been underperforming. Indeed, according to the Financial Times, around one third of Shell’s assets, are not producing a positive return-on-investment. The assets dragging on Shell’s balance sheet include the company’s $8 billion share in the huge Kashagan oilfield, half of the company’s shale oil business within the United States (worth a total of $24 billion) and numerous downstream assets.

However, Shell’s new chief executive, Ben van Beurden is planning on making some changes, which look as if they will change the company for the better. For example, Mr Beurden has drawn up a plan to divest $15 billion worth of assets within the next few years. The idea is that these disposals will allow Shell to shed some inefficient assets, while using the cash raised to fund new projects.

As a matter of fact, the first wave of cuts has already started.

FULL ARTICLE

Posted in: Ben van Beurden, Chevron, Exxon Mobil, Royal Dutch Shell Plc.
Tagged: Ben van Beurden · Chevron · ExxonMobil · Oil · Royal Dutch Shell Plc · The Motley Fool

Royal Dutch Shell to sell North Sea fields as it shifts $15bn assets

Jan 16th, 2014 

by John Donovan. 

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Since Mr Van Beurden began working alongside outgoing boss Peter Voser at the beginning of the fourth quarter, the company has cancelled plans to build a gas-to-liquids (GTL) plant in the United States, raising investor hopes of a tighter spending regime. Mr Kenney said he expected Shell under Mr Van Beurden to focus on capital discipline, better returns and selling peripheral assets. Mr Van Beurden will face investors on January 30 as the company reports fourth-quarter results, and on March 13 at a planned investor day.

Sarah Young – 15 January 2014

ROYAL Dutch Shell could look to sell $15bn worth of assets over the next two years including some North Sea fields, a media report said yesterday, expanding on its existing guidance that divestments would accelerate this year.

Shell, whose new chief executive Ben van Beurden took over two weeks ago, will sell some of its North Sea oil fields as well as parts of its refining portfolio and some early-stage projects, reported theFinancial Times, citing a person close to the company.

The oil company, the world’s number-three among investor-controlled energy firms, declined to comment on the report.

Shell and its peers in the industry are facing increasing investor pressure to hold down spending as costs rise and prospects for oil prices wane.

The Anglo-Dutch company said in October that it would step up divestments “significantly” in 2014 and 2015 to keep cash flowing in, after forecasting that 2013 capital expenditure would peak at about $45bn. Analysts and bankers say that some of the company’s Nigerian oil blocks plus Shell’s 23.1pc stake in Australian group Woodside Petroleum — worth over $6bn at current prices — could be put on the block.

“It wouldn’t surprise me if Shell were to sell some North Sea assets,” Santander analyst Jason Kenney said.

“In the North Sea, something like 80pc of its production comes from 20pc of its asset base so there’s a long tail of smaller positions.”

Since Mr Van Beurden began working alongside outgoing boss Peter Voser at the beginning of the fourth quarter, the company has cancelled plans to build a gas-to-liquids (GTL) plant in the United States, raising investor hopes of a tighter spending regime.

Mr Kenney said he expected Shell under Mr Van Beurden to focus on capital discipline, better returns and selling peripheral assets.

Mr Van Beurden will face investors on January 30 as the company reports fourth-quarter results, and on March 13 at a planned investor day. (Reuters)

Irish Independent

Posted in: Australia, Ben van Beurden, Gas, Nigeria, Oil, Oil Company Profits, Peter Voser, Royal Dutch Shell Plc, United States.
Tagged: Australia · Ben van Beurden · Nigeria · Oil · Peter Voser · Royal Dutch Shell Plc · Woodside Petroleum

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JOHN DONOVAN JANUARY 14, 2014 ARTICLES

Royal Dutch Shell Fire Sale

Jan 14th, 2014 

by John Donovan. 

2 comments

By John Donovan

The Financial Times has published an article today about Shell’s dramatic plans under the surprise new CEO, Ben van Beurden, to dispose of a string of assets, including North Sea oilfields.

According to one quoted analyst, Shell may divest $30 billion in non-core assets, including its stake in Woodside in Australia and assets in the USA and Nigeria.

The article by Guy  Chazan says: “Shell has underperformed the European oil and gas sector by 6 per cent over the past year, dragged down by a string of disappointing quarterly results…. It has been criticised for spending too much and not rewarding shareholders enough.“

One fellow executive director, Peter Rees QC, has already unexpectedly announced his rapid exit from Royal Dutch Shell plc just days after BvB assumed his new supreme position. 

FT ARTICLE

Posted in: Australia, Ben van Beurden, GoogleNews, Nigeria, Peter Rees QC, Royal Dutch Shell Plc, United States.
Tagged: Australia · Ben van Beurden · John Donovan · Nigeria · Royal Dutch Shell Plc

Peru ignores UN and pushes ahead with deadly gas project

Jan 14th, 2014 

by John Donovan. 

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Any contact with gas workers could introduce fatal diseases to the uncontacted Indians. When Shell carried out initial explorations in the area during the 1980s, half the Nahua tribe was wiped out following first contact with outsiders.

January 14, 2014

Peru’s government is on the brink of approving the expansion of the highly controversial Camisea gas project into the land ofuncontacted and isolated tribes – ignoring a recent UN recommendation to first carry out ‘extensive studies’ over the threats posed to the vulnerable Indians.

Peru’s Ministry of Culture has approved a plan to expand the $1.6 billion Camisea project – run by Argentina’s Pluspetrol, US’s Hunt Oil and Spain’s Repsol – once three minor conditions are met, raising fears that expansion is imminent.

Any contact with gas workers could introduce fatal diseases to the uncontacted Indians. When Shell carried out initial explorations in the area during the 1980s, half the Nahua tribe was wiped out following first contact with outsiders.

The expansion plan includes the detonation of thousands of explosive charges, and the drilling of exploratory wells using heavy equipment, and involving hundreds of workers. It would take place inside the Nahua-Nanti Reserve for uncontacted and isolated Indians.

James Anaya, the UN’s Special Rapporteur for the Rights of Indigenous Peoples, visited the region last month and warned, ‘The government and company should act with extreme caution and should not go ahead with the proposed expansion before first assuring conclusively that the (tribes’) human rights are not at threat’.

Mr. Anaya further recommended that the government carry out ‘exhaustive studies (…) to ascertain the presence and conditions in which isolated or uncontacted tribes find themselves’.

But despite several visits to the area, the Peruvian Ministry of Culture, tasked with protecting the country’s indigenous peoples, has failed to carry out the necessary studies on the impact of Camisea’s expansion on uncontacted tribes, and at least three Ministers have resigned in protest at the plans.

Survival International has demanded a halt to any oil and gas work on the land of uncontacted tribes, and Survival supporters have sent more than 130,000 messages to Peru’s President Humala.

Survival’s Director Stephen Corry said today, ‘The Camisea expansion plan sets a chilling precedent. If Peru’s biggest gas project is allowed to operate in the middle of a reserve for uncontacted tribes, the laws the government has put in place to protect its indigenous peoples are rendered utterly meaningless. Why the rush to diminish the country’s resources at the cost of indigenous lives? Has Peru learned nothing from the bloody and shameful history of contact?’

Act now to help the Uncontacted Indians of Peru

Your efforts are crucial in defending the Uncontacted Tribes. Get involved in this urgent effort in the following ways.

Writing a letter to the Peruvian government can make a real difference.
Donate to the Uncontacted Indians campaign (and other Survival campaigns).
Write to your MP or MEP (UK) or Senators and members of Congress (US).
Write to your local Peruvian embassy
If you want to get more involved, contact Survival…

SOURCE ARTICLE

Posted in: Business Principles, Environment, Human Rights, Oil, Royal Dutch Shell Plc,Shell.
Tagged: Peru · Survival International

Total dips a toe in UK shale but BP and Shell unlikely to follow

Jan 14th, 2014 

by John Donovan. 

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The French company trumpeted becoming the “first major to enter into shale gas licences in the UK”, calling it an “important milestone”. But its stance contrasts starkly to that of Shell, whose British chief financial officer Simon Henry said last year it had no desire to be “first in and be in the headlines every day in the UK”. Shell had “much higher priorities, and more attractive opportunities” elsewhere and would not throw money into shale…

US majors next most likely to invest while BP and Shell expected to steer clear in the short term at least

By Emily Gosden: 9:07PM GMT 13 Jan 2014

 More international oil and gas majors may follow Total’s lead in joining the search for British shale gas – but BP and Royal Dutch Shell will not be among them, experts have predicted.

The French energy giant on Monday confirmed it would invest $48.1m (£29.3m) in the search for shale gas in the East Midlands, taking a 40pc stake in two licences held jointly by IGas, eCORP, Egdon Resources and Dart Energy

The move was hailed as the biggest vote of confidence yet in the potential of UK shale, following investments by GDF Suez and Centrica – two smaller but still heavyweight companies.

British Gas owner Centrica in June committed up to £160m in a deal to take a 25pc stake in Cuadrilla’s licences in the Bowland shale in north-west England and fund drilling, while France’s GDF Suez in October said it would invest £24m in acquiring a 25pc stake and funding drilling across Dart Energy licences in the north of England.

Industry experts say more deals are likely to follow, with IGas – which put partnership talks on ice last year to first carry out more drilling itself – seen as a likely contender. Attention is now focused on whether other majors will follow Total by entering the UK market.

 The French company trumpeted becoming the “first major to enter into shale gas licences in the UK”, calling it an “important milestone”.

But its stance contrasts starkly to that of Shell, whose British chief financial officer Simon Henry said last year it had no desire to be “first in and be in the headlines every day in the UK”. Shell had “much higher priorities, and more attractive opportunities” elsewhere and would not throw money into shale “because the UK feels it’s a good thing”.

BP, too, has indicated it is not rushing to follow Total. A spokesman said it had decided against investing in shale in the UK or the rest of Europe “for good geological and commercial reasons”. “We continue to monitor competitor results with interest, but so far we have no regrets,” he said.

Experts say BP and Shell’s attitudes reflect in part the typical reticence of the world’s biggest oil firms to enter new regions first; for most majors it is not yet clear whether UK shale is a prize worth pursuing – especially given the potential PR battle involved.

BP’s shale interests consist of ‘giant’ fields, Angus McPhail, analyst at Edison Investment Research, says. “Whether UK shale can be considered ‘giant’ at this stage prior to any extensive drilling having been completed is debateable.”

Shell meanwhile is undergoing a period of change with a new chief executive and about to begin a programme of asset sales. US giant ExxonMobil is believed to have held talks with IGas in 2012 and is still seen as a possible market entrant but, according to Malcolm Graham-Wood of advisory Hydrocarbon Capital, Exxon is likewise not sure whether UK shale is “worth it, being such small beer”.

But Total, unusually, has a reputation for dipping its toe into untested markets. “Total has always been prepared to go somewhere on the offchance,” Graham-Wood says. “Majors will normally try to get smaller companies to de-risk frontier acreage, but Total is slightly maverick.”

It has added reason to be interested in the UK because fracking is banned in its native France due to environmental fears – despite apparently promising resources, he says.

“If it is successful in the UK and people realise there’s an opportunity to get cheap energy, France will change its rules – and Total will have the expertise and a team in place to do the job.”

US companies are the most likely next entrants to the UK market as they look to make the most of the expertise they have acquired in the US market, he says.

Glynn Williams, partner at Epi-V, the oil and gas services investor, agrees. He picks out US giants ConocoPhillips and Chevron – who have both “invested significantly in the Polish shale market” as “plausible” contenders to be “the next majors to commit to the UK shale sector”.

SOURCE

Posted in: Daily Telegraph, Environment, Fracking, Gas, Royal Dutch Shell Plc, Shale Gas, Shale Oil, Simon Henry, Total.

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