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BBC Radio - File on 4: Shell (Broadcast 23 March 04)


This week File On 4 examines the latest crisis facing Shell, the world's third largest oil and gas company.


Last week Shell admitted for the second time in less than four months that it had over-reported the level of its proven oil reserves.


Analysts have been alarmed by the size of the miscalculations which were out by twenty percent - or nearly 4 billion barrels.


Earlier this month the chairman, Sir Philip Watts was forced to resign and investigations are now underway by financial regulators in both the United States and Europe. Legal action is also underway in America on behalf of shareholders.


For years now, Shell has proclaimed itself a model of ethical capitalism. It puts responsibility to people and the environment alongside profit in a so-called "triple bottom line."


But, as Allan Urry reports, the Anglo Dutch giant is also facing legal action around the world from communities which claim that their health is being damaged by pollution from Shell plants, and from conservation groups trying to protect marine life in areas where Shell is drilling for oil.


The programme examines the environmental concerns surrounding plans for a major oil and gas pipeline on Sakhalin Island off the far east of Russia. The pipeline crosses an earthquake hotspot and it's claimed that activity by oil companies in the region is endangering a species of whale already on the edge of extinction. The World Wildlife Fund and other groups are challenging the pipeline in the Russian courts.


Sakhalin Energy, the Shell company involved in the project, insists that its operations have not harmed the whales and says the safety of the pipeline is still being reviewed.


The programme also travels to Port Arthur in Texas, where families living beside the Motiva refinery, part owned by Shell, claim to have suffered ill health because of toxic emissions from the plant. They now face a long legal battle with Motiva which denies the allegations.


A company spokesman tells File on 4 that no connection has been proved between high incidences of respiratory illness in the area and the discovery of raised levels of dangerous chemicals, such as Benzene, in the atmosphere around the plant.

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