shell

Royal Dutch Shell stands at a strategic crossroads. Its response to the reserves scandal in 2004 has been a global reserves replacement hunt through a programme of relentless capital expenditure. This search included an investment in US Arctic leases in the mid-2000s that dwarfed other companies’ spending.

The US Arctic Ocean presents almost a perfect storm of risks – a requirement for a long-term capital-intensive investment for uncertain return, a remote and uniquely challenging operating environment, ongoing court challenges, a lack of extraction and spill response infrastructure, and the spotlight of the world’s environmental organisations, the US political community and international media.