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BBC World Service l Inside the Global Giants
 
  Introduction
  Unilever - Cleaning up in Africa
  Unilever - Power in Ghana
  Gazprom - The world's largest gas company
  Gazprom - Modernising a giant
  Levi's - Dilemmas in denim
  Levi's - Balancing ethics with profit
  Shell - Green or mean
  Shell - Future considerations
  Solectron - The invisible multinational
  Solectron - Re-inventing itself
 
Shell - Future considerations



The Athabasca oil sands project in Canada shows that Shell still places great faith in the potential for traditional fossil fuels, despite its stated desire to develop renewable energy. The project involves one of the largest construction sites on the planet, employing 14,000 workers. Shell is investing 2.3 billion Canadian dollars to bring it to fruition.

But extracting oil here is several times more expensive than from a conventional well. In a world where oil prices regularly rise and fall by large margins, and which could fall dramatically if Saddam Hussein were deposed in Iraq, can Shell be confident that it will always make a profit?

Shell Canada's Rob Seeley, Manager of Sustainable Development, told the BBC that even if the oil price fell to 10 dollars a barrel, dangerously close to the basic cost of recovering oil from the oilsands, the Athabasca project would be able to continue.

"The oil sands are a long term game’ Seeley states, ‘so at this point we've already committed our $6 billion and our oil pricing forecasts tell us that it wouldn't stay that low for a long time. The average pricing for crude oil in the world is probably closer to the $18 mark. If it dips into the lower range, we keep running the facilities. We have to keep running it. We have to continue to use the asset."

But Shell has many other concerns beyond making a simple profit. It's had to negotiate deals with indigenous people in the region, whose economy, based around fur-trapping, has suffered massively as a result of the anti-fur movement.

Shell has therefore been helping local people to set up a company operating trucks on the mine site, as part of business opportunities connected to the mine potentially worth millions of dollars.

The treatment of indigenous peoples is a sensitive subject. In the mid-nineties Shell came in for fierce criticism for its treatment of the Ogoni people in Nigeria, whose violent protests eventually forced Shell to abandon its oil wells on their land. In Canada, it seems, Shell is managing to keep peace with its neighbours.

The company also maintains ongoing consultations with local environmental groups over the impact of the Athabasca project. Gail McCrimon from the environmental consultancy the Pembina Institute, said Shell is getting better, but must do more.

"The problem that we have’, McCrimon says, ‘is that overall industrial development on a global basis is not sustainable, and so whatever Shell does, they have to do thinking over the long term and not just the short term. So they need to do more of what they're trying to do now, which is to be more efficient, and to cause the least possible disturbance that they possibly can."

Shell is performing a difficult balancing act in a world which is ever more hungry for energy. It knows that the biggest profits are still to be found in fossil fuels. But it also knows that it must be seen to be paying heed to environmental and social concerns, and keeping a hand in the rapidly developing technologies of renewable energy.

If it fails to balance these interests, its long term future may be in jeopardy.
 
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