Shell Oil Company

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This article is about the U.S. division. For the parent company, see Royal Dutch Shell. For the Canadian oil company of the same trademark, see Shell Canada.
Shell Oil Company
Industry Oil, energy
Headquarters Houston, Texas, U.S.
Key people Marvin E. Odum, President
Revenue Increase $2.147 billion (2008)
Employees 24,008 (2008)
Parent Royal Dutch Shell
Website Shell U.S. Site
One Shell Plaza, Shell Oil Company's headquarters in Houston.

Shell Oil Company is the United States-based subsidiary of Royal Dutch Shell, a multinational "oil major" of Anglo-Dutch origins, which is amongst the largest oil companies in the world. Approximately 22,000 Shell employees are based in the U.S. The U.S. head office is in Houston, Texas. Shell Oil Company, including its consolidated companies and its share in equity companies, is one of America’s largest oil and natural gas producers, natural gas marketers, gasoline marketers and petrochemical manufacturers.

Shell is the market leader through approximately 25,000 Shell-branded gas stations in the U.S. which also serve as Shell's most visible public presence. Shell Oil Company is a 50/50 partner with the Saudi Arabian government-owned oil company Saudi Aramco in Motiva Enterprises, a refining and marketing joint venture which owns and operates three oil refineries on the Gulf Coast of the United States.

The Shell Oil Company Warehouse, built in 1925 and located at 425 S. N. 16th Ave. Phoenix, Arizona. It is listed in the National Register of Historic Places. Reference #85002073

Shell products include oils, fuels, and card services as well as exploration, production, and refining of petroleum products.[1] The Shell Oil Refinery in Martinez, California, the first Shell refinery in the United States, supplies Shell and Texaco stations in the West and Midwest.[2]

Shell gasolines previously included the RU2000 and SU2000 lines (later there was a SU2000E) but they have been superseded by the V-Power line.[3]

In 1997, Shell and Texaco entered into two refining/marketing joint ventures. One combined their midwestern and western operations and was known as Equilon. The other, known as Motiva, combined the eastern and gulf coast operations of Shell Oil and Star Enterprise, itself a joint venture between Saudi Aramco and Texaco.[4] After Texaco merged with Chevron in 2001, Shell purchased Texaco's shares in the joint ventures.[5] In 2002, Shell began converting these Texaco stations to the Shell brand, a process that was to be completed by June 2004 and was called "the largest retail re-branding initiative in American business history."[6]

Relationship with Royal Dutch Shell[edit]

Logos used by the Shell Oil Company between 1900 and 1999

Until the mid-1980s Shell’s business in the United States was substantially independent, with its stock “Shell Oil” traded on the NYSE and with little direct involvement from the Group’s central office in The Hague, Netherlands. In 1984, Dutch Royal Shell made a bid to purchase those shares of Shell Oil Company it did not own (around 30%) and despite some opposition from some minority shareholders which led to a court case, Shell completed the buyout for a sum of $5.7 billion.[7] Despite the acquisition, however, Shell Oil remained a fairly independent business. This was due in part to complex legal reasons as Royal Dutch Shell feared that there could be onerous liability problems if a closer control of Shell Oil's affairs was exercised by the "parent companies." One consequence of this independence was that the Shell logo used in the U.S. was slightly different from that used in the rest of the world. In the 1990s Shell Oil's independence began to gradually to erode as the "parent companies" took a more hands-on approach in running the business. The logo used in the United States is the same as that used elsewhere since June 1, 1998.[8]

Subsidiaries[edit]

Legal issues[edit]

Environmental[edit]

Storage tanks and towers at Shell Puget Sound Refinery, Anacortes, Washington

In 1999, the U.S. Environmental Protection Agency (EPA) issued a Notice of Violation to Shell Oil Company for its infringements of the Clean Air Act at a bulk petroleum terminal the company owned in Bridgeport, Connecticut, prior to October 1, 1998. According to the report, Shell loaded a total of 28.4 million gallons of gasoline onto barges without required vapor recovery equipment on seven days in 1997 resulting in 56 tons of uncontrolled volatile organic compound emissions. During the investigation, the EPA found that Shell built an additional loading bay in 1995 without permits from the state Department of Environmental Protection. Bridgeport’s facility had been recorded to produce an average of about 170 tons of volatile organic compounds per year.[9] This modification has the potential to produce 30 tons more per year more of the polluting emissions.[10]

Shell Puget Sound Refinery, Anacortes, Washington, was fined $291,000 from 2006 to 2010 for violations of the Clean Air Act making it the second most-fined violator in the Pacific Northwest. As of 2011, it was listed as "high priority violator" since 2008.[11][12]

In 2008, a lawsuit was filed against Shell Oil Company for alleged Clean Air Act violation. Shell Deer Park facility, 20 miles east of Houston, was the nation’s eighth-largest oil refinery and one of the world’s largest petrochemical producers. The facility was also the second largest source of air pollution in Harris County, which ranked among the lowest in the nation in several measures of air quality.[News 1] According to Sierra Club and Environment Texas, analysis of Shell’s reports to the Texas Commission on Environmental Quality, air pollutants released at Deer Park since 2003 exceeded the EPA's emissions limits.[13]

Shell, working with Philips, implemented efforts to reduce the impact of its operations on the millions of migratory birds that encounter the North Sea drilling operations.[14][15]

Zone-pricing[edit]

Mehdi Shahbazi was a Shell station operator in central California who posted signs in 2005 stating "Big oil's unearned profit" in protest of zone pricing. Shell sued Shahbazi saying that the protest violated the terms of his lease.[16] Shahbazi responded by accusing the company of "breach of contract and of violating the Petroleum Marketing Practices Act." Shell then terminated his contract. A federal judge ruled in favor of Shell and Shahbazi was ordered to vacate the station.[17]

Shahbazi died on November 14, 2007, due to liver failure which was a result of a hunger strike.[17]

Corrib Gas Controversy[edit]

The Corrib gas project entails the extraction of a natural gas deposit off the northwest coast of Ireland. The project includes a development of the Corrib gas field, and constructions of the natural gas pipeline and a gas processing plant. The project is developed by Shell E&P Ireland as operator of the project, in cooperation with Statoil Exploration (Ireland) Limited, and the Vermilion Energy Trust.[18][19]

Controversy arose when planning permission for a pipeline through Broadhaven and Sruth Fada Conn Bay in Kilcommon parish, County Mayo, was granted by the Mayo County Council despite objections from local residents.[20] Shell threatened the residents with court orders if they did not grant the company permission to build through their land.[21] The issue rose to national prominence on June 29, 2005 when five protestors, known as the Rossport Five, were imprisoned by local police officers at Shell's request for interfering with Shell employees carrying out work on the local residents' land.[22] The men were released from Cloverhill Prison on September 30, 2005, after 94 days, when Shell applied to the High Court to have the injunction lifted. This came after intense media and political scrutiny of the case.[23]

Polybutylene lawsuit[edit]

From 1978 to 1995, Shell Oil produced polybutylene pipes, which corrode when exposed to chlorine. A class action lawsuit was filed in 1995 against Shell Oil when the polybutylene pipes caused flooding in many households in the U.S. and Canada.[24] The settlement required Shell Oil to pay for the re-installation of piping for millions of houses for claims filed through May 2009.[25]

Nigerian settlement[edit]

In June 2009 Shell's parent company, Royal Dutch Shell, paid $15.5 million to settle a lawsuit brought in U.S. District Court in New York. The suit alleged that Shell had conspired with the government of military dictator Sani Abacha to kill author Ken Saro-Wiwa and other Ogoni citizens involved in a nonviolent campaign against oil waste dumping in their homeland in the Niger Delta.[26] More than 50 years of unsafe drilling and frequent oil spills and gas flarings in the region have had a disastrous effect on the environment and on human health.[27] Nigerian troops used violence to suppress protests, while Shell resisted pressure to use its influence to improve the situation.[28]

Saro-Wiwa had been president of the Movement for the Survival of the Ogoni People when he and eight others were arrested, brought before a military tribunal, and sentenced to be hanged. After the executions in November 1995, Saro-Wiwa's body was "burned with acid and thrown in an unmarked grave."[28]

The incident focused widespread outrage on Royal Dutch Shell and the Nigerian government. In New York the Center for Constitutional Rights brought suit against the company on the grounds that surviving plaintiffs could not safely return to Nigeria to press their claims there.[28] The $15.5 million settlement paid for legal fees, compensation to Ogoni families, and "a trust to invest in social programs" in Nigeria.[26] Shell did not admit wrongdoing, but claimed the settlement was made on "humanitarian" grounds. Ben Amunwa, director of the Remember Ken Saro-Wiwa organization, replied that Shell settled the case "because the evidence compiled by the plaintiffs, was damning enough to force an out of court settlement."[29]

In 2012[dated info] the U.S. Supreme Court was scheduled to hear arguments in a similar case filed by Esther Kiobel, widow of an anti-Shell activist, to determine whether her case against Royal Dutch Shell may proceed through the U.S. court system.[30]

Human rights issues[edit]

In November 2013, Amnesty International accused Shell Nigeria of falsification of statements about its environmental impact in the Niger delta. Shell rejected the claims as unfounded.[31][32] In the same report, Amnesty also refutes various other statements by Shell; the company has ot yet responded to some of these other claims.

See also the Nigerian settlement section for information about an earlier court cases relating to human and civil rights in Nigeria.

Co-branding with toymaker Lego[edit]

Shell collaborated with the Lego Group from the 1960s through the 1990s in co-branding Lego items with its logo, a form of subliminal advertisment to children; in 2011 Lego rekindled relations and signed a co-branding contract with Shell in 2011. In July 2014, Greenpeace slammed Lego for this partnership.[33]

See also[edit]

Notes[edit]

  1. ^ Donovan, John. "Reporter". ABC News. Royal Dutch Shell. Retrieved September 6, 2011. 

References[edit]

  1. ^ "Products and Services". Shell Oil Company. Retrieved February 27, 2012. 
  2. ^ "About Shell Martinez Refinery". Shell Oil Company. Retrieved February 27, 2012. 
  3. ^ Holusha, John (April 12, 1990). "Shell Offers a New Gasoline In 10 Cities to Aid Air Quality". The New York Times. Retrieved May 23, 2010. 
  4. ^ "Aspects of the Refining/Marketing Joint Ventures of Shell Oil, Star Enterprises, and Texaco". U.S. Energy Information Administration. July 23, 2001. Retrieved February 27, 2012. 
  5. ^ "Shell to brand new U.S. gas stations". Houston Business Journal (bizjournals.com). February 8, 2002. 
  6. ^ "Trust Your Car to the Man who Wears the... Shell". WCCB-TV. May 8, 2002. Retrieved February 27, 2012. 
  7. ^ Thomas C. Hayes (December 13, 1990). "Shell Oil Shareholders Awarded $110 Million". The New York Times. Retrieved February 27, 2012. 
  8. ^ Tyler Priest (2007). The offshore imperative: Shell Oil's search for petroleum in postwar America. Texas A&M University Press. p. 272. ISBN 978-1-58544-568-4. 
  9. ^ "Air Pollutant Emissions Report: SHELL OIL CO". Scoreboard. 1999. Retrieved February 27, 2012. 
  10. ^ "EPA Issues Notice of Violation to Shell Oil and Motiva in Bridgeport" (Press release). EPA Region 1. August 9, 1999. Retrieved February 27, 2012. 
  11. ^ Robert McClure and Lisa Stiffler (November 7, 2011). "EPA's 'High Priority Violators' Scattered Across the Northwest". NPR. Retrieved 2012-02-27. 
  12. ^ Hsu, Nelson. "Poisoned Places Map". NPR. Retrieved February 27, 2012. 
  13. ^ Erwin Seba (April 23, 2009). "Shell agrees to settle TX refinery pollution suit". Reuters. 
  14. ^ "Protecting bird migration routes". Shell. October 6, 2011. Retrieved 2012-02-27. 
  15. ^ "NAM and Philips help birds migrate safely across North Sea" (Press release). Philips Electronics. August 24, 2007. Retrieved February 27, 2012. 
  16. ^ "Mehdi Shahbazi, 65; gas station operator fought with Shell Oil over fees". Los Angeles Times. November 17, 2007. Retrieved February 27, 2012. 
  17. ^ a b John Donovan (November 18, 2007). "Hunger striker Mehdi Shahbazi dies at 65 after fighting Shell Oil". San Jose Mercury News (Royal Dutch Shell). Retrieved February 27, 2012. 
  18. ^ "Corrib Gas Field Development". Department of Communications, Energy and Natural Resources. Retrieved August 8, 2010. 
  19. ^ "Irish Minister Marks Vermilion's Entry into Corrib Gas Devt". Rigzone. Retrieved November 12, 2009. 
  20. ^ Hickey, Daniel (March 14, 2007). "Corrib gas could be wild card in election battle". Western People. Retrieved July 26, 2010. 
  21. ^ Triumph and disaster (January 22, 2005). "Landowners warned in pipeline row - National News, Frontpage". Independent. Retrieved November 12, 2009. 
  22. ^ Cassidy, Pamela (October 2005). "High-Pressure Deadlock" (pdf). Law Society Gazette (Dublin: Law Society of Ireland) 99 (8). ISSN 1393-6956. Archived from the original on 2007-11-19. Retrieved September 24, 2010. 
  23. ^ 'Cowley expelled during Rossport row', RTÉ Online, 28 September 2005
  24. ^ "$20 million Settlement Announced in Class Action with Shell" (Press release). Siskinds Law Firm. June 11, 2004. Retrieved February 27, 2012. 
  25. ^ "Shell, Hoechst Agree to Pay $850 Million". Los Angeles Times. October 4, 2005. Retrieved February 27, 2012. 
  26. ^ a b "Shell settles Nigeria lawsuit," The Nation, Los Angeles Times, June 9, 2009.
  27. ^ United Nations Environmental Programme, "UNEP Ogoniland Oil Assessment Reveals Extent of Environmental Contamination and Threats to Human Health," UNEP News Centre, August 4, 2011.
  28. ^ a b c "Ken Saro-Wiwa," Times Topics, The New York Times, updated May 22, 2009.
  29. ^ Ben Amunwa (June 10, 2009). "Wiwa v Shell: The day of reckoning". Reuters. Retrieved July 1, 2012. 
  30. ^ Nico Colombant (February 25, 2012). "US Supreme Court Will Hear Shell Nigeria Abuse Case". Voice of America. Retrieved February 27, 2012. 
  31. ^ "Amnesty International uses new evidence to accuse Shell Nigeria of false reports on oil spills". Washington Post. Associated Press. 6–7 Nov 2013. Retrieved November 9, 2013. 
  32. ^ Shell made false claims about Niger delta oil pollution, says Amnesty The Guardian 7 November 2013
  33. ^ Collins, Katie (July 8, 2014). "Greenpeace is right, Shell-branded Lego is ill-judged". Wired UK. Retrieved July 8, 2014. 

External links[edit]