Everything about Shell Oil Company totally explained
Shell Oil Company is the
United States-based affiliate of
Royal Dutch Shell, a
multinational oil company ("
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 company'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 leading oil and natural gas producers, natural gas marketers, gasoline marketers and petrochemical manufacturers.
Independence
Until the mid 1980s Shell’s business in the United States was substantially independent with its stock (“Shell Oil”) being traded on the
NYSE and with little direct involvement from the Group’s central offices in
London and
The Hague, in the running of the American business. In 1984 Shell made a bid to purchase those shares of Shell Oil Company it didn't own (around 30%) and despite some opposition from some minority shareholders which led to a court case, Shell succeeded in the buy-out for a sum of $5.7 billion.
Despite the acquisition, however, Shell Oil remained a very independent business. This was partly for complex legal reasons as RoyalDutch/Shell feared that there could be onerous
liability problems if a closer control of Shell Oil's affairs was taken by the "parent companies". One of the stranger consequences of this independence was that the Shell
logo used in the US was slightly different from that used in the rest of the world. In the 1990s Shell Oil's independence began gradually to be eroded as the "parent companies" took a more hands-on approach in the running of the business. The logo now used in the United States is the same as that used elsewhere.
Business areas
Shell is the market leader for the supply of gasoline to the motorist through approximately 25,000 Shell-branded gas stations in the US 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. It also holds 80% of an exploration firm called
Pecten that explores and drills in various offshore locations including the oil basin near
Douala,
Cameroon in cooperation with the
French government-owned Elf Aquitaine.
Environmental record
The U.S.
Environmental Protection Agency has 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, Conn., until Oct. 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. The result is 56 tons of uncontrolled
volatile organic compound emissions to the atmosphere in an area of New England. During the investigation in May, 1999
EPA also found that Shell built an additional loading bay in 1995 without permit of the state
Department of Environmental Protection. Bridgeport’s facility itself has been recorded to produce average of about 170 tons of
volatile organic compounds per year.However, this modification has the potential of production 30 tons per year more of the pollution emissions.
In 2008, a new lawsuit was opened against Shell Oil Company in Houston, Texas for Clean Air Act violation. Shell’s Deer Park facility is the nation’s eighth-largest oil refinery and one of the world’s largest producers of petrochemicals. The facility is also the second largest source of air pollution in Harris County, which ranks among the worst in the nation in several measures of air quality. According to the environmental groups’ analysis of Shell’s own reports to the Texas Commission on Environmental Quality, air pollutants released at Deer Park since 2003 include:
• Over 2 million pounds of sulfur dioxide;
• Over 1 million pounds of volatile organic compounds (VOCs);
• Over 600,000 pounds of carbon monoxide;
• Over 250,000 pounds of nitrogen oxides;
• Over 90,000 pounds of benzene and 60,000 pounds of 1,3-butadiene.
The lawsuit seeks a court order requiring Shell to end its Clean Air Act violations and pay additional penalties of up to $32,500 per day for each violation of the Clean Air Act.
Controversy and criticism
Mehdi Shahbazi was a Shell station operator in central California from 1982 until September 2007. Incensed by the zone pricing strategy of Shell, he posted signs in 2005 highlighting "Big oil's unearned profit." Shell sued Shahbazi saying that the protest violated the terms of his lease. Shahbazi responded by accusing the company of "breach of contract and of violating the Petroleum Marketing Practices Act." Shell then terminated his contract, stopped supplying his station, and fenced out his oil dispensers.
In August 2007, a federal judge ruled in favor of Shell, and Shahbazi was ordered to vacate the station. Shahbazi had gone on a hunger strike before the ruling, which eventually resulted in his death on November 14, 2007 due to liver failure.
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