Shell CEO on Peak Oil

Shell announced their record profits at two press conferences this week. Shell revealed 2005 profits of $22.9 billion on revenues of $379 billion, which were up 30% from profits of $17.6 billion in 2004. These were the biggest profits ever made by a British company. The London conferences were attended by Chief Executive Jeroen van der Veer and Chief Financial Officer Peter Voser. Also in attendance at the conference was author David Strahan, who asked what van der Veer thought of the idea of peak oil and whether or not Shell had looked at the situation itself.

Van der Veer's actual reply to Strahan on Shell's webcast was "That is a great question it is much more complex than many people think ... because peak oil theory itself is correct, if one takes easy oil close to the markets. If you look at West Texas the oil has gone, or even the North Sea ... but if you look at oil sands you don't know where the peak will come ... if you think about coal ... there are huge reserves. If you assume we can develop clean coal technologies, [then] there will not be one peak. So there is no one peak. There will be many peaks [for different fields, regions and fuels] and they will be in many different time frames ..."

Strahan then asked if van der Veer expected oil sands to make up the difference in any decline of conventional oil. "What I do expect," replied van der Veer, "is at the present price level there is a huge incentive to develop additional forms of energy, hydrocarbon energy and alternative energies, people will respond but it will take some time."

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