Peter Voser, who has led the transformation of Royal Dutch Shell plc from an also-ran in the energy industry into Europe’s leading producer and the world’s largest integrated natural gas operator, announced his surprise retirement last Thursday.
“I feel it is time for a change in my lifestyle, and I am looking forward to have more time available for my family and private life,” Voser, 54, said in a note to staff. He has worked at Shell over a 25-year period, including five years as CFO and four as CEO. He spent nearly two decades at Shell in a variety of financial posts before moving in 2002 to Switzerland-based ABB Ltd., where he was credited in restoring the power company’s financial prowess.
In 2004, rocked by a reserves accounting scandal that forced out Shell’s top executives, the Swiss native was tapped to return as CFO (see NGI, June 28, 2004; April 26, 2004). He succeeded Jeroen van der Veer as CEO in 2009 and quickly went to work to streamline operations (see NGI, June 1, 2009).
Under Voser’s watch, Shell today has a global portfolio second to none, with onshore and offshore opportunities in North America, as well as a growing list of liquefied natural gas (LNG), gas-to-liquids and gas-to-chemicals projects. Shell has more than 22 million metric tons/year (mmty) of LNG on stream and is building 7 mmty of capacity in Australia. More than 20 mmty of projects are on the drawing board worldwide, including LNG Canada in British Columbia, the largest proposed export project to date (see NGI, Aug. 6, 2012).
Another 5 mmty-plus of gas-to-transport opportunities are being assessed, including a gas-based aviation fuel being tested with Qatar Petroleum and LNG-fueled barges for marine transport. Shell also is raising the bar for using gas as a transport fuel in Canada and the United States; in April an affiliate agreed to help build and supply small-scale LNG lanes for trucking customers at existing TravelCenters along the U.S. Interstate system (see NGI, April 22).
Some of Voser’s proposals have proved costly and still uncertain, such as Shell’s push to explore offshore Alaska. The multi-year plans have been paused until at least 2014, while the billions spent to date and to keep the projects viable remain an ongoing concern.
Voser, who said he wanted to serve in non-executive business positions outside of Shell, was praised by Chairman Jorma Ollila for “reorganizing the company, delivering growth and developing a clear forward strategy with a strong portfolio of new options.” The search for a new CEO is under way, with internal and external candidates under consideration. CFO Simon Henry, who presided over the company’s earnings conference call on Thursday, quickly rejected suggestions that he was the leading contender.
Shell’s net profit in 1Q2013 fell slightly from a year ago to $8.18 billion from $8.74 billion, and revenues were off 5% to $112 billion. Stripping out one-time oil price inflation and asset sales, underlying earnings were $7.5 billion in the latest quarter, up 2%.
Shell doesn’t work in “three-month periods” but rather for the long term, with some projects front-loaded and others back-loaded, Henry said. It’s complex to pick only one point in time to view the earnings results, he told analysts. There’s continuing “energy price volatility” from economic and political developments, especially for oil prices lately.
However, Shell has nearly 30 new projects progressing. Year-to-date, there have been four final investment decisions in petrochemicals, deepwater and LNG, he said. Shell’s “dynamic approach to portfolio” resulted in the sale of $600 million of assets in 1Q2013, with more than $21 billion in divestments over the last three years. “Selective” acquisitions that could cost a total of $2-3 billion are planned this year, but if the “right opportunity” strikes, Shell would consider it.
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