Case scenario: Shell & the Brent Spar
Spring 2005
In 1907, two major oil companies were in direct competition with one another, Royal Dutch Petroleum and Shell Transport and Trading. These two companies ultimately formed Royal Dutch/Shell Group, better known as “Shell.” Since 1907, this group has provided much of the world’s petroleum, natural gas, and electricity to all publics (government, employee, employer, special interest, and general). Since their inception, Shell has expanded into a publicly traded billion-dollar company. The two companies still operate separately yet they both support the Royal Dutch/Shell Group.
Shell is the third largest oil and gas group in the world with 14.4 billion barrels in reserve (Shell, 2004). Operations in 145 countries with 119,000 workers who are economically, socially, and environmentally proactive have contributed to the companies’ growth (Shell). With such a large workforce, Shell has a broad “Diversity and Inclusiveness Standard” (D&I) that supports diversity, respect, trial and error, and employees’ needs. To carry out this commitment the Shell Company assures it:
• Approaches D&I management by systematically addressing each of the elements of the Group Diversity and Inclusiveness Framework.
• Supports attraction, development, retention, and promotion of diverse talent.
• Promotes a workplace free from harassment and discrimination.
• Establishes annual diversity and inclusiveness plans, goals and targets for improvement; measures, appraises and reports business performance.
• Includes diversity and inclusiveness performance in the appraisal and development plans of leaders and employees.
• Provides safe and effective ways for employees to report observed behavioral inconsistencies with this standard.
The Brent Spar off-shore oil platform was designed in the mid 1970’s for the dual purpose of storing oil and offloading it onto passing tanker ships. The 14,500 ton steel structure was anchored to the seabed with six anchors (The Annual Achievement, 1998). In 1991 the Brent Spar oil platform was decommissioned. The initial plan for the platform was to dismantle it on shore but the dangers involved prompted Shell to consider other options. Shell initiated studies over the next four years to assess their decommissioning options for the Brent Spar (The Shell/Brent Spar Debacle, 2003).
1995
Feb:
UK approves Shell’s choice for disposal. The first public announcement of plans to sink the Brent Spar came from the UK government (The Annual Achievement, 1998).
April:
Greenpeace launches denouncement of Brent Spar disposal, asserting the decision was made “in secret” and exaggerating environmental concerns. Greenpeace activists begin occupation of Brent Spar (The Annual Achievement, 1998).
May:
Shell publicly announces safety concerns of occupying the Brent Spar. Shell also issues an eviction notice and threatening legal documents to Greenpeace activists occupying the platform (Shell Attempts to Evict, 1995).
June:
Greenpeace activists attempt to paint the sides of the Brent Spar. A nearby Shell ship sprayed the dangling occupants with fire hoses. Shell employees claim they were testing equipment (Shell Attempts to Evict, 1995).
Under pressure from citizens, the German government publicly announces dissatisfaction with deep sea disposal of the Brent Spar. German rumors of a mass- boycott of Shell oil surface (The Annual Achievement, 1998).
Activists were removed from the Brent spar with huge media attention (The Annual Achievement, 1998).
Two hundred German shell stations are damaged or vandalized. Two stations were firebombed and one raked with bullets (The Annual Achievement, 1998).
The British Prime Minister publicly defends Shell’s decision to dispose the Brent Spar at sea; the same day Shell UK announces plans to halt the deep sea disposal (The Annual Achievement, 1998).
Shell announces that the Brent Spar is to be towed to Norway and harbored until a final decision is reached (The Annual Achievement, 1998).
Greenpeace’s Perspective
Greenpeace strives to maintain the environmental integrity of the natural world. These efforts were proven true again in the case of the Brent Spar oilrig. It was on February 16, 1995 that Greenpeace received word that the UK government had granted permission to Shell to dump their huge and heavily contaminated oil installation, the Brent Spar in the North Atlantic. This was of specific concern to Greenpeace considering the fact that this installation still contained toxic radioactive sludge. The planned site for Brent Spar’s disposal would have been just west of Ireland and Scotland (Greenpeace Brent Spar).
When Greenpeace heard of these plans they immediately gathered about two dozen people and began to occupy the top platform of the Brent Spar to prevent Shell from sinking the platform. Greenpeace’s idea was to draw enough attention to the situation that Shell and the uninformed public would have to hear their side of the situation. Greenpeace’s main concern was the impact the remaining toxins and sludge would have on the marine life and overall habitat of the sea floor. They also had a viable concern that this dumping would set a dangerous precedent for the other 50-60 rigs that were set to be decommissioned. If one oilrig of this size were dumped in the ocean, would the UK Government then have to maintain similar habits for future circumstances? This would only create an exponentially growing problem.
Greenpeace admitted they did not have specific knowledge of the measure of pollutants within the Brent Spar. The information they had was based on empirical measurements made by Shell, many of which were mere estimates. In regards to the deep ocean environment, it is poorly understood and, therefore, Greenpeace could only speculate as to the long-term impact that an oilrig could have on this type of environment (Brent Spar). None of this minimizes the main point that Greenpeace was trying to make; the need for Shell to be environmentally responsible. Greenpeace simply wanted Shell to take responsibility for what they created. They wanted Shell to protect the environment by minimizing the accumulation of waste and harmful materials through recycling, treating, and containing. Greenpeace released the following statement:
[We] should no longer needlessly dump wastes into the environment (which ever part) and that we must act responsibly to reduce waste and recycle, treat or contain harmful materials. Opinions on the Brent Spar depend not only on the specific knowledge available but also how deeply we value our environment and what damage and precedents we find unacceptable. Public concern about dumping may conflict with the values of some scientists, but it does not conflict with the available scientific knowledge (Brent Spar).
The main concern of Greenpeace was to avoid setting a precedent for future deep-sea disposals. The Brent Spar was one of the first oilrigs that would eventually need to be decommissioned.
Shell’s Perspective:
Executives of Shell Oil believed that they were being very diplomatic when they began the process of determining how best to decommission the Brent Spar. Nearly 200 different options for disposal were studied and 13 were actively analyzed (Rudall Blanchard, 1994). Shell’s goals were to minimize the amount of money spent on the decommissioning and to limit the technical difficulty and risk for injury. After taking these factors into consideration, the final decision came down to two options: deep-sea disposal or on-shore dismantling. The deep-sea option was favorable in terms of cost and hazard to workers. As Shell made their decision, they failed to take into consideration all of the various publics that would be impacted. A press release dated February 16, 1995 announced Shell’s plans for decommissioning the Brent Spar facility:
Disposal of the Brent Spar offshore storage and tanker loading facility has been the subject of extensive discussions between Shell UK Exploration and Production and the Department of Trade and Industry for many months…Shell Expro has now received from the DTI approval for abandonment of the Spar, which will involve removing it from its moorings, following a clean-up operation, and towing it to a designated deep water site in the North East Atlantic for disposal…Preparations are in hand to enable the plan to be put into effect in the summer of 1995.
One possible option, which was investigated closely, was onshore scrapping. However, it was concluded that this approach, involving reversing the installation process, would be technically complex, involving a higher number of offshore operations, would provide no environmental benefit compared with deep-water disposal, and would involve a significantly higher cost than the approved option.
Relevant parties, including environmental and fishing interests, were fully consulted.
The detailed environmental impact analysis for the deep sea disposal option identifies the effect of regulated substances on board and shows the effect to be negligible. Any environmental impact of deep sea disposal would be negligible and would be contained within the buoy’s immediate vicinity.
This method of disposal has been supported by independent evaluation. Balancing safety, environment and cost factors, deep sea disposal is the most practical method of disposal (1995 Press Releases).
Although this announcement appears to be the definitive end to a well-informed decision, this plan was never fulfilled.
Several publics had an interest in this case and Shell executives considered those they thought were most important. The government was consulted several times throughout the decision process; full approval was granted by Norwegian and UK governments for the deep sea disposal. The financial public, which includes stockholders, was also considered, as the decision was greatly based on the amount of money required. Employee publics were also considered, as Shell’s proposed deep sea disposal constituted the least risk to employees.
Because Greenpeace boarded the Brent Spar in protest, the media’s coverage was primarily from an environmental perspective. Shell was portrayed as environmentally irresponsible and experienced harsh criticisms from all publics. Shell gas stations were boycotted and fire-bombed and their public image suffered greatly as well. As a result, false information released by Greenpeace was taken to be true in light of the negative image Shell had acquired.
Follow-up
Greenpeace’s efforts were successful; in June 1995, the Oslo and Paris Commission voted 11-2 to ban the dumping of oil installations In the Northeast Atlantic, including the North Sea (Brent Spar Meeting). The Brent Spar was decommissioned on shore in 1998. The pieces were recycled and used to build a new ferry terminal in Norway. Although this situation led to conflict, much has been learned for future similar situations.
(Blankenship, Buck, Gonnion, Hauslauden, Sabey, 2004)
CASE QUESTIONS:
Question 1. Analyze the “Organization” & “Constituents” boxes of Argenti’s Strategic communication Model for Shell when they were first preparing to release information regarding the sinking of the Brent Spar.
Question 2. Analyze the “Message” & “Feedback” boxes of Argenti’s Strategic Communication Model for Shell when they were first preparing to release information regarding the sinking of the Brent Spar.
Question 3. What departments/divisions of Shell are responsible for communicating with the publics following the release of the plans to sink the Brent Spar?
Question 4. Develop a series of change messages that Shell should send to create/maintain positive relations with various publics surrounding the on-shore decommissioning of the Brent Spar.