The Nation Newspaper

Tag: shell

  • Shell seeks peace in Niger Delta

    The Shell Petroleum Development Company (SPDC), on Friday said development could only be achieved in the Niger Delta under the atmosphere of peace.

    Its manager, Government and Community, Mr. Evans Krukrubo, said this in Yenagoa at the company’s presentation of foreign scholarships to 14 indigenes of Ekeni and Ezetu communities.

    He said it was only when there was peace that oil companies could be in better position to contribute more to the development of their host communities.

    The News Agency of Nigeria reports that Ekeni and Ezetu communities are under the Basan West Cluster Communities in Southern Ijaw Local Government Area of Bayelsa.

    “If you do not have peace in your cluster communities, it will be difficult for the oil or any company to foster meaningful socio-economic development in the area,” Krukrubo said.

    He said the SPDC was partnering with the Bayelsa government to ensure that the Global Memoradum of Understanding (GMoU) between the company and its host communities was fully implemented.

     

     

  • Confusion, anger as Shell shuts operation in Delta

    Confusion, anger as Shell shuts operation in Delta

    With three offices – Main office in Ogunu road, Industrial and Residential Areas (IA and RA) in Ogunu and Edjeba area – Shell Petroleum Development Company (SPDC) and its subsidiaries provided thousands of direct and contract employment as well as contracts in oil services, well servicing, logistics, catering and others.

    That was in the good days. Today, Shell is dead in the Oil City and it is being buried with the fortunes of over half a million people and an entire state. Financial experts say Shell’s closure may cost the state government as much as N25 billion annually from lost taxes and royalties.

    The death knell for the company was sounded nearly a decade ago at the heat of the Warri crisis, when militants and criminals indiscriminately attacked and despoiled the company’s facilities in the creeks. They stole and are still stealing mind-boggling volume of crude oil daily.

    Shortly after the end of the crisis the company began downsizing under the so-called Securing Our Future (SoFu) programme. It was the beginning of the end for most staff, including those in defunct Western Division headquarters, Warri..

    Our findings revealed that over 80% of those sacked are currently without job years after their misfortunes. It is against this bleak background that the recent closure and further sack of hundreds of more staff occurred.

    Investigations by our reporter revealed that the takeover of the facilities by the Nigerian Petrleum Development Company (NPDC) has neither improved the lot of workers nor raised hope about their prospects.

    Some sacked contract staff were transferred to the services of the new operators. But at the time of this report on Sunday, it was gathered that they are owed salaries since January.

    “We joined them (NPDC) in December 2012; but we were only paid December and January salaries. Since them we have not been paid. After working for five months without salaries we decided to stop work in June,” one of the affected workers told our reporter on condition of anonymity.

    It is not only the fates of former workers who have taken a downturn with the exit of Shell. Our findings revealed that multibillion naira facilities in Ogunu, Edjeba and Warri main offices of the company are rotting away.

    At the Edjeba area, which was mainly used as residential are, our checks revealed that the hitherto well-manicured lawns are giving way to weeds. The posh air around the expansive estate is dissipating and bowing to filth from blocked drains.

    The Main Office, which was the heart and nerve of the administration of the division is not insulated from the decay. Eight massive administrative buildings marked blocks ‘A’ – ‘G’ are almost empty. The story is same for structures like the GXD, which houses the famous ‘Shell Restaurant’ and others home to banks and projects offices.

    Reports that a major religious leaders in the area was in negotiation to acquire the massive administrative complex for a proposed university could not be immediately confirmed. Some top politicians are also said to be engaged in a extreme scramble to acquire the company’s estates.

    At the Vendors’ Section, with entrance at the Ugbuwangue end of Warri, weeds and cobwebs have replaced hundreds of smartly dressed men and women who attended to contractors.

    Rows of business premises that sprung up when the vendor gate was set up are forlorn and deserted, their fates inextricably tied to those of contractors who have lost their means of livelihood.

    The Industrial Area (IA) in Ogunu area of the city fares just insignificantly better. The verdure grass at the Ogunu Club golf turf is still well manicured and a handful of expatriates still swing clubs and putter every morning. Local caddies tag along even though they know that their future and the aesthetic beauty of the scene remains is as assured as the life span of the blossoming flowers around the turf.

    Grasses are steadily creeping into the multi-hectare housing facilities, which Shell has also abandoned at the IA. Office buildings have also been evacuated with workers now moved to the block referred to as ‘Aso Rock’ on the tip of the river. It is from here that skeletal operations at now carried out.

    The air operation at Ogunu is still operation with Caverton Helicopter, a private firm handling the air shuttle services of Shell. But sources in ‘Aso Rock’ told our reporter that Shell is set to close down its air base in Warri.

    “Workers, who still have their families in Warri have been advised to relocate them to Port Harcourt because of the plan closure of air operation. With the new plan, all flights will now be from Forcados to either Lagos or Port Harcourt,” our source, who asked not to be named, added.

    Social services provided from the Ogunu base to neighbouring communities and the city at large are also receding. The fire department, arguably the best equipped and maintained in the city, like Shell Clinic and Police services are awaiting their dates with the hang man.

    When our reporter visited the Kosini end of the Edjeba Estate earlier in the week, dozens of residents of the city were seen fetching water from taps connected to Shell treatment plant in the estate. Mr. Royal Eruagbere said the water is the safest for drinking in the city. This may not be for long.

    Meanwhile, the fates of all those affected by the closure has led to anger by residents and stakeholders in the state who accused the government of not doing enough to stop the total closure of Shell from the state.

    Chief Bobson Gbinije, a public commentator, described the development as “a great indictment on Governor Uduaghan and the Delta State leadership”.

    “The Delta State leadership is inexcusably guilty for this brazen administrative socio- economic solecism and hara-kiri,” he added.

    Mr. Zik Gbemre, a local activist and contractor said the company should not be allowed to operate facilities in the state from outside it.

    “You cannot cook food in Delta State and take it to Lagos to serve whereas people in Delta State are hungry. When there is an oil spill, it is the people of Delta State (farmlands, fish ponds, bush animals, air) that suffer it; just as the people suffer the immediate negative effects of gas flaring. Therefore, the same people should also be the immediate beneficiaries of the offices of Oil & Gas companies by way of getting employment as engineers, technicians, operators, cleaners, drivers, security personnel plus award of contracts.”

    Chief Favour Ogbeyirine Izoukumor, a contractor and former President of the Izon-Ebe Oil Producing Communities Forum (IOPCF), said there was little the government could have done.

    Izoukumor, who is CEO of Lurine Nigeria Ltd, said it was wrong for the company to close down its entire operations in the area when it only divested from some onshore facilities. “This means that Shell will be operating facilities in Delta State and paying tax to other state. That is just wrong.

    “Shell only divested from the land operations; there are other facilities that it is still operating like the Ogulagha and Escravos fields. These are in Delta State. Based on these, I think I would want to submit that on the finally analysis whatever the state government did or did not do was not enough, because Shell has left,” he added.

    In his reaction to alleged inaction of Governor Uduaghan, the Communication Manager to the governor, Mr. Paul Odili explained that the government was at a disadvantaged position because it is not a partner in the Joint Venture between the NNPC and oil multinationals.

    Besides, he said the effect of the divestment would only be temporal, noting, “Beyond providing employment for cleaners and cooks Shell has never done the state any good. The governor is completely dissatisfied with Shell’s operation and he has expressed it severally. The company declares billions of dollars in profit every year, yet its host communities do not feel its impact.”

    Odili said the conduct of oil multinationals like SPDC makes the Petroleum Industry Bill important for the survival of oil producing communities.

    He said the operation of Shell divested facilities would only be temporary, stressing that there is the need for companies that will take them over to sit down and enter into negotiations that give the state more leverage and capture the interests of host communities.

  • We lost only $250m in Nigeria, says Shell

    We lost only $250m in Nigeria, says Shell

    Oil giant Shell has admitted that the impact of operating environment in Nigeria was not responsible for the company’s $700 million revenue loss in the second quarter of the year.

    The clarification, which was made yesterday by a spokesperson of Shell Nigeria, Precious Okolobo, in an email statement.

    He said the bulk of the loss resulted from impact of weakening Australian dollars on deferred tax liability.

    He said only $250 million of the total $700 million loss was due to operational challenges in Nigeria, including crude oil theft and blockage of Nigeria Natural Liquefied Gas (NLNG).

    He said: “We wish to correct some wrongful interpretation of aspects of Shell Group earnings in Q2, as announced on August 1, by our Chief Executive Officer, Peter Voser.

    “It was disclosed that Q2 Current Cost of Supplies (CCS) earnings, excluding identified items were reduced by around $700 million. Of the amount, $250 million was due to operational challenges in Nigeria, including crude oil theft and blockade of Nigeria LNG.”

    The rest of the figure, $450 million, was caused by the impact of the weakening Australian dollar on a deferred tax liability, he said.

    Okolobo continued: “At no time did Peter Voser refer to Nigerian production outages costing it $700 million in the second quarter, as some media organisations have wrongly reported.”

    This is coming after the Nigerian National Petroleum Corporation (NNPC), challenged Shell Group over claims that it lost $700 million in Q2 to operating environment in Nigeria.

    “With regard to claims by Shell that it lost $700million by the second quarter of 2013 to crude oil theft and other disruptions in Nigeria, NNPC posits that the loss claims are not localised to Nigeria as reported,” its Acting Group General Manager, Public Affairs, Tumini Green, said in a statement on Tuesday.

  • ‘Rising costs, Nigeria troubles blot Shell profits’

    ‘Rising costs, Nigeria troubles blot Shell profits’

    Rising costs, a surge in oil thefts and disruption in Nigeria and other negative factors hit profits at Royal Dutch Shell on Thursday, leading outgoing chief executive Peter Voser to call the second quarter result “disappointing.”

    Shell said it took a $700 million hit for a combination of Nigeria  Nigeria and for the tax impact of a weakening Australian dollar, and warned that Nigeria itself faces a $12 billion annual bill for the disruption.

    Reuters reports that Shell recently put more of its Niger Delta activities up for sale.

    Adjusted second quarter net earnings on a current cost of supply basis came in at $4.6 billion, down from $5.7 billion a year ago and below analysts’ expectations of a result that would have been little changed on last year.

    “Higher costs, exploration charges, adverse currency exchange rate effects and challenges in Nigeria have hit our bottom line,” said Voser, who is due to step down at the end of this year. “These results were undermined by a number of factors – but they were clearly disappointing for Shell.”

     

  • Our role in the $1.09b Malabu Oil mess, by Shell

    Our role in the $1.09b Malabu Oil mess, by Shell

    Shell Nigeria Ultra Deep Limited (SNUD) is in the centre of the Malabu Oil deal, for which it is being investigated by the British police. The Nation has obtained documents filed at the International Centre for Settlement of Investment Disputes in wh

     

    The controversy over the $1.092, 040,000 Malabu Oil deal continues with one of the parties, Shell Nigeria Ultra Deep Limited (SNUD) opening up on how it acquired 40 per percent equity in Oil Prospecting Licence (OPL) 245 in 2000.

    The company insisted that it followed due process and consulted with relevant officials in the administration of ex-President Olusegun Obasanjo.

    It also claimed that it received verbal assurances from the then Vice-President Atiku Abubakar that there was no objection from the Federal Government to Shell acquiring an interest in OPL 245.

    It attributed the current crisis to the withdrawal of the allocation of OPL 245 to Malabu in July 2001 and how Obasanjo allegedly made a u-turn on March 25, 2002 leading to threats of legal action from Malabu Oil and Gas.

    Shell admitted that the revocation of the oil block was shocking as “no explanation was given”. The Anglo-Dutch firm said it paid $210million as signature bonus for the oil block and operates the block on a Production Sharing Contract (PSC) basis.

    It said S$ 209 million of the $210million signature bonus had remained in an escrow account ever since and with accruing interest; it grew to S$231, 299, 884.04 as of February 2008.

    These facts were contained in a Claimant’s Memorial filed by SNUD before the International Centre for Settlement of Investment Disputes.

    A copy of the Memorial was exclusively obtained yesterday by our correspondent.

    The memorial is expected to be tabled before the UK Police which has stepped into the investigation of the Malabu Oil deal.

    The memorial said: “In 1998, during the Gen. Sani Abacha military regime, OPL 245 had been allocated to Malabu on behalf of the Ministry of Petroleum Resources by Mr. Dan Etete in his capacity as the then Presidential Adviser on Petroleum and Energy. Malabu was an indigenous Nigerian company, incorporated on 24 April 1999, with Nigerian shareholders, apparently for the purpose of petroleum prospecting.

    “In March 2000, Malabu approached Shell within a farm-in proposal. Malabu was looking for an international oil company to take a 40% equity stake in the OPL 245 licence itself and ‘carry’ Malabu in developing the block i.e. the international oil company would take all the exploration and development risk by funding Malabu’s share of the costs (including the acquisition, exploration and development costs of the block) as well as its own.

    “Those costs would then be recovered by the international oil company from Malabu’s share oil production.

    “Malabu’s representative provided Shell with a technical information brochure relating to OPL 245 and copies of the letter of allocation of OPL 245 to Malabu dated 29 April 1998, a letter to the DPR attaching cheques in respect of the US$2m “down payment” of the signature bonus and other fees and a letter confirming that the allocation had not been withdrawn dated 9 March 2000.

    “At that time, several other oil exploration and development licences allocated by the Abacha regime had been withdrawn by the new civilian Government of President Obasanjo.

    “Shell made enquiries from the Assistant Director of the DPR, Mr. Andrew Obaje, on 31 March, 2000. He confirmed to Shell that OPL 245 had been owned by Malabu since April 1998 and was currently in good standing.

    “Obaje told Shell that the FGN did not intend to revoke the allocation because Malabu had paid all the required fees and part (US$2.04 million) of the US$20 million signature bonus for the block. The map of allocated concessions obtained from the DPR also indicated that Malabu was the owner of OPL 245.

    “Nevertheless, Shell decided to pursue negotiations with Malabu. On 4 October, 2000, Shell was approached by a new Malabu representative. He was known to Shell, because he had been employed as the Managing Director of Texaco in Nigeria until his retirement in mid-2000.

    “Shell received verbal assurances from the then Vice-President of Nigeria that there was no objection from the FGN to Shell acquiring an interest in OPL 245.”

    SNUD also released the details of its agreement with Malabu Oil and Gas.

    The document added: “On 24 January 2001, Malabu and Shell executed a Heads of Agreement (“HoA”). The HoA set forth the major principles of agreement between Shell and Malabu regarding OPL 245.

    “In the HoA, the parties ‘acknowledged that there (would) be …. other items of significance to be negotiated in final definitive commercial agreement(s) in connection with the transaction proposed (therein) (thereafter) referred to as the (“Definitive Agreements”)”;

    “Malabu agreed to Shell holding a 40% interest in OPL 245 and being appointed contractor in respect of the licence, that Shell would pay, to and on behalf of Malabu, various amounts and that Shell would ‘carry’ Malabu.

    “Once the HoA was finalised and signed, work began on the Definitive Agreements, which included:

    “The Definitive Agreements were intended to govern the parties’ relationship for the duration of the OPL 245 farm-in.

    “The Farm-In-Agreement was to provide the basis for the farm-in-agreement whereby SNUD would acquire a 40% interest in OPL 245, based on certain representations and warranties by Malabu, in return for making specified payments to or for Malabu.

    “The OPL 245 Deed of Agreement was the actual instrument that would effect the assignment of a 40% interest in OPL 245 from Malabu to SNUD.

    “The Operating Agreement was to define the parties’ respective rights and obligations in operating OPL 245 and in connection with OPL 245 itself.”

    On how the disputes over

    the oil block came up,

    SNUD linked it to the withdrawal of the allocation of OPL 245 to Malabu.

    Shell said: “On 6 April 2001, Shell delivered the signature bonus cheque in the sum of $17,960.000 and the Deed of Assignment and other Definitive Agreements, to Mr. Macaulay Ofurhie (Director of the DPR) and Mr. W.A Obaje (Assistant Director of the DPR) in person.

    “Upon receipt of those items, Mr. Ofurhie acknowledged that OPL 245 was still in good standing and Mr. Obaje stated that the allocation was valid for ten (10) years from April 1998.

    “On 12 April 2001, Shell learnt that Malabu had received a letter dated 9 April 2001 from the DPR granting OPL 245 to it, authorizing it to commence operations and confirming that the Deed of Assignment was due to be forwarded to the President of the Federal Republic of Nigeria(FRN) for approval early the following week.

    “On 20 April 2001, Malabu told Shell that the DPR had confirmed that the conveyance of title had been signed by the President of the FRN and the Deed of Assignment would be approved very soon.

    “Seven days later, on 27 April 2001, Shell was informed that the Deed of Assignment had been approved by the FGN and was for allocation at the DPR.

    “On 24 may 2001, Malabu received the signed title deed of OPL 245 together with the co-ordinates of the licence area.

    “However, in approximately mid-June, reports appeared in the Nigerian press suggesting that –notwithstanding the assurances Shell had received from Malabu and the results of its own due diligence-certain individuals whose names were not contained in any official records were claiming an interest in Malabu and/or OPL 245.

    “In early July 2001, Shell received news that the FGN had withdrawn the allocation of OPL 245 to Malabu.

    The Federal Government’s letter of withdrawal of July 2, 2001 stated that: “I, (the Director of Petroleum Resources) have been directed to inform you that the allocation of OPL 245 to Malabu has been withdrawn and the issued title deed has been revoked. You are therefore required to return the title deed of the block in your possession to the Department of Petroleum Resources please”.

    “The FGN’s revocation was a shock to Shell as no explanation was given but Shell continued to hope that Malabu (together with Shell’s assistance) could reverse the FGN’s revocation. Shell did all it could do to assist Malabu to reverse the FGN’s decision.

    “Shell heard no more substantive developments until 19 February 2002 when Malabu representative informed Shell that he was still confident that things were on the right track at all levels in FGN.”

    SNUD gave further insights into how Obasanjo made a u-turn on the oil block and Malabu Oil and Gas threatened legal action.

    It said: “On 25 March 2002, a Shell representative was suddenly and unexpectedly summoned to meet with President Obasanjo in Abuja the following day.

    “Chief Olusegun Obasanjo (the President of the FRN), Mr. Obaseki, Mr. Kayode Are (the Director General of the State Security Service), Mr. Funsho Kupolokun (Special Assistant to the President of the FRN on Petroleum Matters) and a representative from ExxonMobil were all present.

    “At the meeting, the President of the FRN informed Shell and ExxonMobil that OPL 245 would not be returned to Malabu and that Shell and ExxonMobil would instead be invited to bid competitively not for the role of licence-holder (as Malabu had been) but rather for the role of contractor for OPL 245 with NNPC holding the licence.

    “The President of the FRN said there was to be a simple and transparent competitive bidding procedure whereby Shell and ExxonMobil would submit sealed bid containing a proposed signature bonus and the highest bid would win the right to develop the block in accordance with the terms of a PSC. (As noted above, very few oil and gas companies had the experience in drilling in “ultra –deep” water, Shell and ExxonMobil being two).

    “On 7 April 2002, Shell received a formal invitation to bid, dated 5 April 2002, together with the Guidelines for Competitive Bidding on Block 245 from the Office of the Special Adviser to the President on Petroleum Matters.

    “Shell learnt that, following the invitation to bid, Malabu wrote directly to the FGN on 9 April 2002 threatening to commence legal proceedings.

    “In response to that threat, on 29 April 2002, the Office of the Presidential Adviser on Petroleum and Energy wrote to Shell to confirm that: The Federal Government has revoked the prior award of this block to Malabu oil and Gas Limited.

    “The decision to revoke the award was made solely in the best interest of the Federal Government in reliance on its rights under law and without any influence from your company or its affiliates or anyone else.”

    Further to Federal Government ’s letter, on May 6, 2002, Shell wrote to Malabu setting out its position as to the frustration of the HoA and the Farm-In-Agreement and also giving notice of termination of both agreements.

    “On 13 May 2002, Shell submitted its bid for the role of Contractor for OPL 245 on the basis of a PSC to which NNPC was the contractual counterparty

    “On 23 May 2002, the Ministry of Petroleum Resources wrote to SNUD to confirm that it had been successful with its bid. The letter stated that:

    “The allocated block would be operated on a “Production Sharing Contract” (PSC) basis. The Nigerian national (sic) Petroleum Corporation shall be the Concessionaire, while your company shall be the contractor”.

    “The PSC was executed and approved by the Presidential Advisor on Petroleum and Energy for and on behalf of Minister of Petroleum Resources, on 22 December 2003.

    “Under the terms of the PSC, SNUD obtained the “exclusive right” to conduct Petroleum Operations (i.e. the winning or obtaining and transportation of petroleum or chargeable oil in Nigeria by drilling, mining, extracting or other like operations and all operations incidental thereto and any sale of or any disposal of dischargeable oil) in the area of OPL 245 for a period of 30 years.

    “The conditions of the approval were that SNUD would act as contractor, pay a signature bonus of US$210 million and operate the block on a PSC basis with the NNPC as concessionaire and SNUD as Contractor.

    Shell disclosed that it had

    so far invested $535.9 mil

    lion in the controversial oil block.

    “Following the execution of the PSC with NNPC, SNUD undertook major work and incurred substantial expenditure in connection with OPL 245.

    “SNUD paid the signature bonus of US$ 210 million in December 2003. SNUD paid $1 million via bank draft on 23 December 2003. SNUD paid the remaining US$ 209 million into an escrow account pursuant to an Escrow Agreement with the FGN (as represented by the Ministry of Finance) and JP Morgan Chase which was signed on 22 December 2003.

    “The total amount incurred in developing OPL 245 amounts to over $535.9 million. SNUD has borne all the risks attendant upon the exploration and appraisal of the OPL 245 area.”

     

    ich Shell explains how it was caught in the Malabu web. Managing Editor, Northern Operation YUSUF ALLI reports.

  • UK probes Shell, ENI Nigerian oil block deal

    UK probes Shell, ENI Nigerian oil block deal

    British police is investigating a money-laundering allegation related to a big oil field bought by Shell and ENI spa from Nigeria for $1.3 billion, after most of the cash they paid ended up in a company linked to a former Nigerian petroleum minister.

    The probe concerns offshore block OPL 245, which industry sources say contains up to 9.23 billion barrels of crude – more than enough to keep China running for two and a half years – the ownership of which had been in dispute for more than a decade.

    “The proceeds of crime unit is investigating a money-laundering allegation in the United Kingdom in connection with OPL 245. The investigation is at an early stage,” a UK spokesman told Reuters.

    Transparency campaigners, who asked the UK to look into the matter, assert that Shell and ENI used the Nigerian government as a go-between to obscure the fact that they were dealing with former oil minister Dan Etete, who also has a 2007 money-laundering conviction in France related to bribes he was alleged to have taken when in government.

    In his capacity as petroleum minister, Etete awarded block OPL 245 in 1998 for a payment of just $2 million to Malabu Oil and Gas, a company in which he played a prominent role.

    The critics claim that Shell and ENI, which haven’t been accused of any legal wrongdoing, wanted to distance themselves from Etete given his reputation and his involvement in the original award of the oil block to Malabu.

     

  • Shell to rehabilitate 45,000 bpd flow-station

    Shell Petroleum Development Company of Nigeria (SPDC) operated Joint Venture said it would begin work on the Ogbotobo flowstation in order to put it into operation.

    Shell’s Corporate Media Relations Manager, Tony Okonedo, in a statement, said SPDC has taken a key step towards rehabilitating the Ogbotobo Flowstation in Western Niger Delta through the award of a contract for reviving the power system of the facility.

    He explained that operations at the flowstation were suspended in the security crisis in 2006, and SPDC plans to restart the facility to support resumption of oil production from the entire Ogbotobo field.

    Ogbotobo Flowstation, with a capacity of 45,000 barrels of oil per day was producing about 10,000 barrels when it was shut down, he added.

    According to him, the contract was awarded to an indigenous firm, LEE Engineering and Construction Nigeria Limited, and covers replacement of the station’s power generation and distribution system. It is planned to resume operations at Ogbotogbo Flowstation once the power system is up and running.

    “This is a major step toward fulfilling our aspiration to re-enter fields that we left in the West in 2006 due to insecurity,” said General Manager, Operated Onshore and Shallow Offshore Projects, Toyin Olagunju, at the contract signing ceremony on July 5.

    “A significant aspect of the contract is that it is being executed by an indigenous contractor thus promoting SPDC efforts to grow Nigerian capacity in the oil and gas sector. We will support the contractor to deliver the project on schedule in a safe and secure manner,” Olagunju added.

    Chairman of LEE Engineering, Dr. Leemon Ikpea, said: “I thank SPDC for the opportunity to be a part of their production delivery goal. As our practice, LEE Engineering will strive to work safely in the delivery of the project.”

     

  • Nigeria loses 150,000 barrels per day as Shell shuts major oil pipeline

    Nigeria loses 150,000 barrels per day as Shell shuts major oil pipeline

    Shell Petroleum Development Company (SPDC) has shut a major pipeline in Nigeria for the second time in less than a month after locating another leak on the line repeatedly hit by oil thieves, the company said yesterday.

    The shutdown of the Trans Niger Pipeline will result in a cut of about 150,000 barrels of oil per day in Africa’s biggest oil producer. Nigeria’s total output has been at around two million barrels per day.

    The joint venture Shell operates in Africa’s biggest oil producer on Thursday “shut in the 24-inch Trans Niger Pipeline (TNP) as a result of a confirmed leak on this line at the Bomu-Bonny section at Owokiri,” it said, naming an area of southern Nigeria.

    “With the 28-inch TNP already shut in for removal of illegal oil theft connections, a total of about 150,000 barrels per day of oil have been deferred.”

    The British-Dutch company said details were unclear on the latest incident, “but the TNP has been variously targeted by crude oil thieves in recent months and shut down several times to enable the removal of theft points.”

    Crude oil theft is a major problem in Nigeria, with estimates that the country loses some $6 billion in revenue per year as a result. Such theft can involve thieves tapping pipelines to syphon crude for sale on the lucrative black market.

    It can lead to explosions, fires and oil pollution.

  • Shell shuts 24 inch Trans Niger Pipeline

    Shell shuts 24 inch Trans Niger Pipeline

    The Shell Petroleum Development Company of Nigeria Limited (SPDC) operated Joint Venture yesterday shut in the 24-inch Trans Niger Pipeline (TNP) as a result of a confirmed leak on the line at the Bomu- Bonny section at Owokiri.

    With the 28 inch TNP already shut in for removal of illegal oil theft connections, a total of about 150,000 barrels per day of oil have been deferred.

    Details of this latest incident including cause and size of spill are unclear at the moment, but the TNP has been variously targeted by crude oil thieves in recent months and shut down several times to enable the removal of theft points, said Tony Okonedo, SPDC’s Corporate Media Relations Manager in a statement.

    The relevant authorities have been notified of the incident and SPDC is mobilizing to respond as quickly as possible with a joint investigation visit (JIV) and repairs, preparatory to clean up, Okonedo added.

  • Shell appoints Ben van Beurden CEO

    Shell appoints Ben van Beurden CEO

    The Board of Royal Dutch Shell plc has announced that Ben van Beurden will succeed Peter Voser as Chief Executive Officer, effective 1 January 2014.

    Peter Voser will leave Shell at the end of March 2014, marking the end of 29 years with the Company.

    Van Beurden, 55, has been Downstream Director since January 2013.

    “I am delighted to announce Ben van Beurden as the next Chief Executive Officer of Royal Dutch Shell,” said Chairman Jorma Ollila. “Ben has deep knowledge of the industry and proven executive experience across a range of Shell businesses. Ben will continue to drive and further develop the strategic agenda that we have set out, to generate competitive returns for our shareholders.”

    “Van Beurden’s selection came after a comprehensive assessment and review of internal and external candidates led by the Board Nomination and Succession Committee,” Ollila added.

    Van Beurden joined the Royal Dutch/Shell Group of Companies in 1983 and has held a number of technical and commercial roles in both the Upstream and Downstream businesses. He has worked in The Netherlands, Africa, Malaysia, USA and, most recently, the UK.

    Van Beurden, a Dutch national, graduated with a Master’s Degree in Chemical Engineering from Delft University of Technology, the Netherlands. He is married and has four children.