Royal Dutch Shell Group .com

Financial Times: Shell names new head of SEI project

 

By Carola Hoyos

May 14, 2004

Posted 15 May 04

 

Royal Dutch/Shell, Europe's second-largest energy group, has named a relative newcomer as head of one of its most important, projects.

 

Ian Craig, who joined Shell when it acquired Enterprise in 2002, will take over as chief executive of Sakhalin Energy Investment, Shell's largest project, in July.

 

The company has admitted the $10bn (5.6bn) Russian oil and natural gas project is suffering cost overruns, which some insiders have put at as high as 20 per cent.

 

"It is significant in dollar terms, but not extraordinary," said one Shell representative.

 

Mr Craig will take over from Steve McVeigh, who spent three-and-a-half years - longer than initially intended - overseeing some of the initial phases of the project. At the start of his tenure, he worked on the handover of the operation from Marathon, the US independent oil and gas company, to Shell, and last year saw the project receive Shell's final investment approval.

 

Most recently, Mr Craig headed Shell's liquefied natural gas (LNG) project in Malaysia after having been technical director for Enterprise.

 

In 2007, Shell hopes to send LNG tankers from the eastern Siberian island to the fast-growing Asian market. Sakhalin also produces some oil, which Shell is only able to export during part of the year because of the harsh winters.

 

The company aims to make it a year-round enterprise by building extra pipelines to more southern ports accessible by tanker all year.

 

John Barry, chairman of the board of Sakhalin Energy, said yesterday: "On behalf of Sakhalin Energy's board of directors, I wish to thank Mr McVeigh for his personal energy and commitment in leading the Sakhalin II Project. Although he was due to leave last year he extended his commitment to provide leadership during project transition to full construction mode."

 

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