Archived press release

Shell's profits - a cause for shame

4 May 2006

Shell announced a 12 per cent increase in its quarterly profits today (Thursday 4 May) as oil prices continue to hit record highs. But Friends of the Earth said the results should be a matter of shame for the company which fails to meet its own standards or live up to the green promises used in publicity campaigns. The environmental campaign group is calling on the UK Government to intervene with tougher environmental standards incorporated into company law.

The Government is currently introducing new laws for companies under the Company Law Reform Bill. Friends of the Earth says this is the ideal opportunity for the Government to ensure that UK companies show leadership on environmental standards across the world [1].

Shell stands accused of breaches of environmental legislation in Nigeria and the Philippines. In Nigeria, a court ruled that Shell's persistent practice of flaring gas breached local people's human rights, as well as being illegal under Nigerian law [2]. In the Philippines Shell is accused of circumventing local law which required the company to relocate its depot from a densely populated neighbourhood of Manilla [3].

"Yet again Shell is profiting while communities and our environment pay the price. Shell's pursuit of profits from oil is fuelling climate change and causes major environmental and health problems for many communities around the world. Shell's repeated refusal to deal with these issues shows the need for Government intervention. Companies cannot be relied on to act voluntarily. Tougher environmental and social standards must be included in company law."

Shell also claims to be taking action on climate change, saying: "We believe action is required now to lay the foundation for eventually stabilizing greenhouse gas concentrations in the atmosphere in an equitable and an economically responsible way. It is time to pursue stable, market-based policies that help energy users and suppliers pursue innovative energy solutions" [4]. But earnings from Shell's exploration and production division - the division that explores for and extracts oil - increased by 45 per cent this year. Shell is continuing to push ahead with the Sakhalin II project for which it is applying for $300 million of tax payers' money. The Sakhalin Energy Investment Company has announced significant cost overruns.

Notes

Make business work for people and planet

[2] Shell ordered to appear by Nigerian court

[3] Office of the Punon Barangays, Pandacan District IV, Manila, Position Paper in Favor of the Development, Operation, and Maintenance of the Oil Depots by Caltex, Inc., Pilipinas Shell Petroleum Corporation, and Petron Corporation in Pandacan, Manila, 28 March 2003.

[4] Shell website - "Our approach to climate change"

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Published by Friends of the Earth Trust