Shell2004 report Guardian

No Comments » December 28th, 2006 posted by // Categories: Energy Development Project



June 7, 2005


Shell pays N438.9b as taxes, royalties last year
By Sulaimon Salau


SHELL Petroleum Development Company (SPDC) has
estimated to have paid approximately $3.3 billion (N438.9 billion) to Nigerian
government as taxes and royalties in 2004.


According to the 2004 annually report tagged “People and
Environment” recently released by the company managing director, Mr. Basil
Omiyi, the company had also awarded $727 million (N96.7 billion) worth of
contract to Nigerian companies to boost the local content initiative of the
Federal Government, while 20 per cent of it were allocated to companies from
the Delta where Shell operates most.


He said: “The government’s revenues from our operations
are our biggest contribution to development, at an oil price of $30, for
example, our operations generate more than $24 a barrel for the government in
taxes, royalties and its shares in joint venture production, SPDC earns


Omiyi stressed that the company encourages the use of
Nigerian contractors and suppliers, by requiring foreign bidders to work with
qualified Nigerian contractors, not just as agents, but also train contractor
staff, and also support proposed laws mandating the use of local firms.


Shell, scrutinising its environmental performance, noted
that it would miss the target of ending continuous flaring of associated gas
in the country by 2008.

It now sets another target of 2009, while it anticipated
to invest additional $1.8 billion (N240 billion) to that effect.


The Shell boss, however, attached this to the past
under-funding by its government partner, (NNPC) and delays by SPDC in
implementing projects.

Targeting the next step, he said: “We must improve our
environmental performance and make up for past mistakes, including cleaning up
oil spills, preventing a new ones and ending continuous flaring of gas.”


He, however, unveiled Shell’s intention to shut-in its
wells during 2008, where it cannot find permanent solutions to the associated
gas (currently expected to be 17 low production fields).


The first Nigerian MD of SPDC maintained that Shell in
the year under review, had cleaned-up 199 sites, exceeding its target of 100


Provided the communities where it operates would give
access, Shell according to him, plans to restore all identified spill sites
for re-mediation by the end of 2006

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