Royal Dutch Shell Group .com Brinded new power behind shaky Shell throne


By Andrew Callus

Reuters, 03.10.04, 9:33 AM ET


LONDON, March 10 (Reuters) - The real power at humbled Royal Dutch/Shell is now Malcolm Brinded, the bearded British engineer with 30 years solid experience of its core oil and gas business, according to two company sources.


The 50-year old key director is a "credible oil and gas man", one source said, unlike Jeroen van der Veer, who is officially the new number one. He is also less tainted with the reserves scandal that has rocked the company than some other directors who remain after last week's sackings.


Shell sacked its two top directors a week ago, blaming their actions and inactions for the revelation that proved reserves had been overestimated by 20 percent.


U.S. newspapers have since reported that top bosses knew in 2002 that reserves estimates were at odds with U.S. Securities and Exchange Commission guidelines.


Even Judy Boynton, appointed finance director in 2001 but who did not join the top-level Committee of Managing Directors (CMD) until a year ago, was sent some memos, the reports said.


But Brinded was a newcomer to the top echelons at the time, joining the CMD on July 1, 2002. That was just days before the date on one memo, published in the New York Times this week, which appeared to draw the problem to the CMD's attention.


Last week, Brinded took over as head of the company's core division, exploration and production. He replaced his sacked colleague Walter van de Vijver, whilst maintaining his role as head of the group's gas and power division, an increasingly important part of the group.


He was also made vice chairman of the CMD under van der Veer, who took over the top executive post of chairman from Phil Watts.


"Malcolm's the one to watch," said one of the sources. "He's a credible oil and gas man... Van der Veer is really not that impressive and they (management) know it. He hasn't got that much EP (exploration and production) or OP (oil products) experience. Those are the businesses that matter. He's never been in charge of anything important."


Van der Veer, 56, has a degree in mechanical engineering, but his CV mainly describes roles in "corporate planning" and as an "area coordinator". Most recently he ran the chemicals division -- Shell's least profitable activity, and one it has sought to reduce its exposure to in recent years.


Brinded, by contrast, has worked at the sharp end for Shell, in Brunei and Oman. From 1993, he worked his way to the top of Shell Expro, the North Sea offshore joint venture with ExxonMobil, and then became Shell's Country Chairman for the UK. Only one of these areas, Oman, is implicated in Shell's now notorious January reserves recategorisation, and Brinded was long gone by 1997, when the problems began.


Despite his Cambridge University graduate Britishness, Brinded also has a strong claim to membership of the Dutch side of the company. He joined in 1974 in The Hague, headquarters of Royal Dutch Petroleum. Until he swaps to the UK arm Shell Transport & Trading next month to even up representation on the CMD, he remains an employee, and a director, of Royal Dutch. "The shape of the board now shows you that the Dutch have flexed their muscles. With 60 percent ownership they have that right," said the second source. "Brinded has a foot in both camps, and that helps".


Shell Transport and Trading, the UK arm, holds the other 40 percent of the operating company.


Friendly, personable and outwardly confident, Brinded turns 51 on March 18, and is seen as one of the sharpest minds in Shell.


He is no stranger to controversy, having been thrust into the limelight as spokesman for the industry during the UK's fuel crisis in 2000 -- a period in which road tanker drivers and farmers blockaded refineries in protest at high motor fuel prices for which oil company profits were being blamed.


Then, he knew when to keep a low profile, making the briefest of statements before directing journalists' questions outside the prime minister's Downing Street residence to a senior policeman beside him, and retreating swiftly to his car.


At a presentation on Shell's Gas To Liquids (GTL) projects in Qatar on Tuesday he was equally tight lipped about Shell's crisis, dismissing questions with a cheerful "No comment".


Shell has said it is not appropriate to comment on the findings of an ongoing review that is being conducted independently of management.


Copyright 2004, Reuters News Service




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