JOHN DONOVAN APRIL 5, 2014 ARTICLE

China a sink hole for Royal Dutch Shell

Apr 5th, 2014

by John Donovan. 

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There are so many things wrong in China and RDS has no idea of what is going on. Investors be aware that it is a sink hole with no financial bottom and the “good ole boy” politics are in play in China.

Posting on Shell Blog by “Tyler” on 2014/04/05 at 04:04

Let’s talk China.

Shell has made commitment to drill Sichuan Province (press release 03/2014). What the story doesn’t tell everyone is that Shell has spent 1 Billion USD and has yet to find sustainable gas.

It also does not address the fact that Shell China has gone from 9 rigs to 1 rig in Sichuan.

Office staff in Chengdu is over 500 people for a 1 rig operation, by the end of 4Q 2014.

Let’s not forget that Shell China has been put under the US Unconventional Wells group. These are the same ones that screwed up the US Shale Gas Projects. The new manager is Chengdu is an American who came from Alaska, we know how that turned out.

There are so many things wrong in China and RDS has no idea of what is going on.

Investors be aware that it is a sink hole with no financial bottom and the “good ole boy” politics are in play in China.

RELATED ARTICLE: Royal Dutch Shell News: China Investment & Shareholders Rewards

RELATED INFORMATION

In China, Shell operates the onshore Changbei tight-gas field under a PSC with PetroChina. The two parties have also agreed to appraise, develop and produce tight gas in the Jinqiu block in the central Sichuan province under a 30-year PSC (Shell interest 49%), which expires in 2040. The Jinqiu project achieved first gas production in September 2011. Also in Sichuan, Shell and PetroChina are assessing shale gas opportunities in the Fushun-Yongchuan block. The two parties are also assessing opportunities in coalbed methane in the Ordos Basin, where Shell has an agreement to evaluate resources in North Shilou. Shell is also a partner in the Hangzhou city ring joint venture that develops, operates and manages a high-pressure natural gas pipeline system. Shell’s Downstream business in China has 15 joint ventures and 9 wholly-owned companies. The various Shell ventures cover about 700 Retail fuel stations, 7 Lubricant blending plants, 10 Bitumen plants, and the Nanhai Petrochemicals complex.

Posted in: Alaska, China, Gas, GoogleNews, Royal Dutch Shell Plc, Shale Gas, Shell,Unconventionals.

Tagged: Alaska · China · Gas · Royal Dutch Shell Plc

The TRUTH will set you FREE.

JOHN DONOVAN APRIL 4, 2014 ARTICLES

Shell Oil Boss Marvin Odum Should Resign after Alaskan Debacle

Apr 4th, 2014 

by John Donovan. 

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Now we have further confirmation that Shell was trying to dodge a multimillion tax bill. This time confirmation comes from the findings of an investigation by the Coast Guard division of US Homeland Security. There are going to be more Royal Dutch Shell executives looking for alternative employment… And Marvin Odum, Shell’s boss in the USA, should be top of the list.

By John Donovan

After Shell’s Arctic ambitions hit the rocks at the end of December 2012, Shell initially conceded that the ill-fated Kulluk drilling rig had left port under tow to avoid taxes.

Shell then backtracked. Shell’s chief executive Peter Voser rejected accusations that tax issues were a factor in the move.

We subsequently had confirmation from one of the honest people at Shell, Sean Churchfield, its operations manager in Alaska, that the first admission was correct. The Kulluk had indeed left port in order to avoid “millions” in annual state taxes.

Peter Voser spent too much time castigating BP for the Gulf of Mexico disaster and not enough making sure that Royal Dutch Shell did not itself also come spectacular unstuck in US waters. In view of his self-serving comments about BP, he must now be viewed, in my humble opinion, as a hypercritical incompetent.

That high visibility of the series of serious mishaps in Alaska severely damaged the credibility and reputation of Shell and no doubt contributed to the decision by Voser to prudently take early retirement, as did the original fall guy for the Alaskan fiasco, David Lawrence of Alaska.

Now we have further confirmation that Shell was trying to dodge a multimillion tax bill. This time confirmation comes from the findings of an investigation by the Coast Guard division of US Homeland Security.

Having read the relevant Coast Guard report quickly, there were a lot of short cuts taken – needless to say, nobody wants to admit responsibility when things go wrong, so all that the Coast Guard can say is that standards and procedures were not complied with/adhered to. This is usually referred to in court as gross or wilful negligence.

There are going to be more Royal Dutch Shell executives looking for alternative employment… And Marvin Odum, Shell’s boss in the USA, should be top of the list.

It is relevant to recall that Shell reserved its position in respect of an analysis at the time by retired Shell International Group HSE Auditor, Bill Campbell, of the fall out from the Arctic shambles. We published it on this website. See “Shell Misadventures in the Arctic Region in Alaskan waters”

Some readers may have heard of the concept of a “licence to operate” – this is the largely intangible qualification by which oil companies are authorised by host governments to undertake very complex and inherently hazardous operations, and is justified on the basis of the companies’ experience and historical track records for safe operations. The only tangible aspects of a “licence to operate” are the companies’ standards and procedures, which in this case were clearly ignored.

Shell’s “licence to operate” in Alaska should be revoked.

Posted in: Alaska, Arctic, Beaufort Sea, Bill Campbell, BP, Chukchi Sea, Corporate Governance, Environment, GoogleNews, Gulf of Mexico, John Donovan, Marvin Odum,Oil, Peter Voser, Royal Dutch Shell Plc, Shell Employee Safety, United States.

Tagged: Alaska · Arctic Ocean · Beaufort Sea · Chukchi Sea · John Donovan · Oil · Peter Voser · Royal Dutch Shell Plc

Shell seeks urgency on Alaskan litigation

Apr 4th, 2014 

by John Donovan. 

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Extracts from an article by Alan Bailey of Petroleum News published week of April 06, 2014 under the headline: Shell seeks urgency: Asks court to accept BSEE proposal in Chukchi Sea lease sale appeal case

In an April 2 filing submitted to the federal District Court in Alaska Shell said that it opposes any delay in resolving an appeal against the 2008 Chukchi Sea lease sale in which the company purchased leases.“Because the Arctic drilling season is so short, every day of it counts,” Shell told the court. Shell said that it had already lost the 2014 Chukchi Sea drilling season as a result of the appeal and that the company had begun planning for the 2015 season “in the event the agency (BSEE) re-affirms the sale.”

FULL ARTICLE

Posted in: Alaska, Arctic, Beaufort Sea, Chukchi Sea, Litigation, Royal Dutch Shell Plc,Shell Project Delays, Shell Project Overruns, United States.

Tagged: Arctic Ocean · Beaufort Sea · Chukchi Sea · Litigation · Petroleum News ·Royal Dutch Shell Plc

Shell ignored safety warnings ‘partly to avoid tax’, says US Coast Guard

Apr 4th, 2014 

by John Donovan. 

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• Terry Macalister

• theguardian.com, Friday 4 April 2014 14.54 BST

Damning allegations are made in the report into how Shell came to allow the Kulluk to run aground in December 2012. Photograph: PA3 Jon Klingenberg/AP

Shell has been accused by the US Coast Guard of ignoring safety warnings and moving one of its drill ships in the US Arctic, partly in a bid to avoid paying extra taxes.

The damning allegation is contained in an official 152-page report by the US Coast Guard into how the Anglo-Dutch oil group came to allow the Kulluk to run aground in December 2012.

Shell has recently been forced to shelve any plans to drill in the Beaufort Sea again this summer after a federal appeal court ruled the US authorities had failed to properly consider the potential risks.

One senior US politician said Shell should be punished for its “reckless” behaviour and the report raised “major red flags” over any future oil and gas exploration in the pristine waters of the far north.

The US Coast Guard report said Shell’s plans “were not adequate for the winter towing operation across the Gulf of Alaska” while arguing that a potential tax penalty influenced the decision to set sail in stormy weather. The Kulluk was in danger of being subjected to new Alaskan taxes if it stayed in local waters beyond the end of December.

The US Coast Guard quoted the master of a ship brought in from an independent towing company, Edison Chouest Offshore, to oversee the move of the Kulluk as saying early on in the operation: “To be blunt, I believe that this length of tow, at this time of year, in this location, with our current routing guarantees an ass kicking.”

A spokesperson for Shell, which spent $5bn on Alaskan exploration without any significant oil or gas find, said the company was still reviewing the report, which it accepted was based on a thorough investigation and would take any findings seriously.

The official added: “Already, we have implemented lessons learned from our internal review of our 2012 operations. Those improvements will be measured against the findings in the USCG report as well as recommendations from the US Department of the Interior.”

There was no comment on the suggestion that Shell partly moved the rig to avoid taxes but this was previously denied in December 2012 by the now-departed chief executive, Peter Voser.

Meanwhile senator Ed Markey, a Democratic member of the Senate commerce and environment committees in Washington, said: “This report shows that Shell ran through every single safety and common sense red light in moving this rig because of financial considerations. This kind of behaviour should raise major red flags for any future Arctic drilling plans … Shell should be held accountable for its reckless behaviour.”

SOURCE

Posted in: Alaska, Arctic, Beaufort Sea, Chukchi Sea, Corporate Governance,Environment, Royal Dutch Shell Plc, Shell Employee Safety, Shell Project Delays, Shell Project Overruns, The Guardian, United States.

Tagged: Alaska · Arctic Ocean · Beaufort Sea · Chukchi Sea · Royal Dutch Shell Plc

Shell Rushed Rig to Arctic Sea to Avoid Alaska Tax: U.S.

Apr 4th, 2014 

by John Donovan. 

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Article by Jim Snyder published Apr 4, 2014 5:00 AM GMT+0100 by Bloomberg News

A desire to avoid millions of dollars inAlaska state taxes played a role in Royal Dutch Shell Plc (RDSA)’s decision to move a drilling rig, which later broke free from a tow boat and ran aground on an uninhabited island in Alaska, the U.S. Coast Guard said in a report.

Shell had decided to move the Kulluk drill rig to Seattle for repairs because it might have been subject to a state property tax had it remained in Alaska waters beyond Jan. 1, 2013, according to the report released yesterday that offered eight recommendations to improve safety.

“A complex series of events contributed to the error chain that resulted in the grounding,” the report states. “The most significant factor was the decision to attempt the voyage during the winter in the unique and challenging operating environment of Alaska.”

Shell has spent billions of dollars in its effort to drill for oil Alaska’s Beaufort and Chukchi seas, which are part of the Arctic Ocean. The Hague-based company hasn’t resumed work in Alaska waters, and said in January that it didn’t plan to return to the Arctic this year. The decision followed an appellate court ruling that challenged the validity of a lease sale in the Chukchi.

“We appreciate the U.S. Coast Guard’s thorough investigation into the Kulluk towing incident and will take the findings seriously,” Shell said in a statement.

A series of mishaps, including damage during testing to a containment dome that would be used to cap a spill, prompted the U.S. Interior Department to examine Shell’s Arctic operations in January 2013. The review criticized Shell’s oversight of contractors that were part of its Arctic drilling operations.

Senator Lisa Murkowski, an Alaska Republican, praised the Coast Guard for the report and said energy resources in the Arctic can be developed, “but it requires that we adhere to world-class safety standards.”

Senator Edward Markey, a Massachusetts Democrat, said in a statement that the report raises “major red flags for any future Arctic drilling plans.”

To contact the reporter on this story: Jim Snyder in Washington atjsnyder24@bloomberg.net

To contact the editors responsible for this story: Jon Morgan atjmorgan97@bloomberg.net Steve Geimann

SOURCE

COAST GUARD REPORT (152 PAGES)

Posted in: Alaska, Beaufort Sea, Bloomberg, Chukchi Sea, Environment, Oil, Royal Dutch Shell Plc, Shell Employee Safety, Shell Project Delays, Shell Project Overruns,Shell Tax Avoidance, United States.

Tagged: Alaska · Arctic Ocean · Beaufort Sea · Chukchi Sea · Oil · Royal Dutch Shell Plc

Shell was underprepared for ill-fated tow across Gulf of Alaska

Apr 4th, 2014 

by John Donovan. 

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Extracts from an article by Suzanna Caldwellpublished April 3, 2014 by AlaskaDispatch under the headline: Coast Guard report shows Shell was underprepared for ill-fated tow across Gulf of Alaska

A Coast Guard report released Thursday shows that while a series of events ultimately led to the grounding of a drilling rig designed to drill in the Arctic, an “inadequate assessment and management of risks” was the biggest cause of the Kulluk grounding.

The findings in the 152-page report conclude that while bad weather in the Gulf of Alaska was the primary cause of the grounding, “ineffective” risk management and application of towing measures from Shell and Edison Chouest contributed to the grounding.

The report lays out in specific detail everything that led to grounding of the drilling rig, which was heading to Everett, Wash., where offseason repairs could be completed ahead of the planned 2013 Arctic drilling season. The move was also timed to avoid a tax liability that would have left Shell on the hook for millions of dollars had the Kulluk remained in Alaska waters.

“The Coast Guard report shows that Shell was completely unprepared for the realities of operating in Alaska’s harsh seas,” said Rebecca Noblin, Alaska director for the Center for Biological Diversity. “But what’s even more troubling is it shows Shell’s willingness to subsume safety concerns to financial ones.This isn’t just about making mistakes; it’s about knowingly taking unnecessary risks to save a few dollars.”

As of late last year, the Kulluk remained in Singapore undergoing repairs. In October, a Shell executive hinted that damage to the rig was so extensive that it might not come back into service.

FULL ARTICLE

COAST GUARD REPORT (152 PAGES)

RELATED: Shell Faces US Coast Guard Investigation Into Alaska Rig Accident

Extract

The exploration campaign in the Arctic waters, which has been hit by protests and legal challenges, along with major technical difficulties, was estimated last year to have already cost about USD5 billion to Shell, before the company had drilled into a single oil-bearing rock. Ben van Beurden, the group’s new chief executive, has been non-committal on whether the company plans to drill the region in the future.

Posted in: Alaska, Arctic, Beaufort Sea, Ben van Beurden, Chukchi Sea, Environment,Oil, Royal Dutch Shell Plc, Shell Project Delays, Shell Project Overruns, Shell Tax Avoidance, United States.

Tagged: Alaska · Arctic Ocean · Beaufort Sea · Chukchi Sea · Oil · Royal Dutch Shell Plc

Alan Shatter rejects Corrib policing probe

Apr 4th, 2014 

by John Donovan. 

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Extracts from an article by Gordon Deegan published Friday 4 April 2014 by The Irish Examiner

Minister for Justice Alan Shatter has rejected fresh calls for an independent inquiry into the Garda policing operation of the €3.4bn Shell Corrib gas project in north Co Mayo. Last week, South African archbishop Desmond Tutu and former UN assistant secretary general Denis Halliday called for an “urgent and comprehensive” independent inquiry into the policing of the Corrib gas project. Mr Shatter said: “I do not see a necessity for an independent inquiry into the policing operation in north Co Mayo.” He said the total cost of policing protests against the Shell Corrib plan “has now reached in excess of €16m”.

FULL ARTICLE

Posted in: Bribery, Corrib Gas Project, Corruption, Environment, Garda, Gas, Human Rights, Ireland, Royal Dutch Shell Plc.

Tagged: Corrib Gas Project · Ireland · Royal Dutch Shell Plc

Poor Management and Tax Dodging Led to Kulluk Grounding

Apr 4th, 2014 

by John Donovan. 

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Article by RACHEL D’ORO Associated Press published 4 April 2014 by ABC NEWS under the headline: “Report: Poor Management Led to Shell Grounding”

A Coast Guard report says poor risk assessment and management were factors that led to the grounding of a Shell oil drilling rig in the Gulf of Alaska in 2012.

The report released Thursday also says Alaska’s tax laws influenced the decision to tow the Kulluk to Seattle. Royal Dutch Shell PLC believed the drill vessel would have qualified as taxable property on Jan. 1, 2013, if it was still in Alaska waters.

The Kulluk broke away from its tow vessel in late December 2012 and ran aground four days later on Sitkalidak Island, near Kodiak.

Damage to the Kulluk played a role in Shell’s decision to forego Arctic offshore drilling in 2013.

The Coast Guard report says sufficient evidence exists for other authorities to consider penalties.

SOURCE

Posted in: Alaska, Arctic, Associated Press, Beaufort Sea, Chukchi Sea, Oil Spill, Royal Dutch Shell Plc, Shell Employee Safety, Shell Project Delays, Shell Project Overruns,Shell Tax Avoidance, United States.

Tagged: Alaska · Arctic Ocean · Beaufort Sea · Chukchi Sea · Kulluk · Oil · Royal Dutch Shell Plc

The TRUTH will set you FREE.