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Providing coverage of Alaska and northern Canada's oil and gas industry
June 2008

Vol. 13, No. 25 Week of June 22, 2008

New Shell general manager for Alaska

Pete Slaiby takes over management of Shell’s Alaska operations, wants local and state governments get share of OCS revenues

Alan Bailey

Petroleum News

Shell has appointed a new general manager, Pete Slaiby, to head the company’s Alaska business. Slaiby was previously Shell’s Brunei asset manager.

The general manager for Alaska has in the past been located in Houston, Slaiby told Petroleum News on June 17. The appointment of a general manager located in Alaska marks Shell’s growing presence in the state, he said.

“I think Anchorage is always the right place for the GM to be. Alaska is a very unique business environment,” Slaiby said, noting the state is very important to Shell.

“The Chukchi and the $2.1 billion lease bonus really put us into another league and with that we really wanted to match our organization … with the size of the business opportunity,” Slaiby said. “… We are very, very serious about Alaska.”

Rick Fox, Shell’s Alaska asset manager who has been Shell’s point man on site in Alaska, will retain his current position, Slaiby said. Fox will deal mainly with operational issues, while Slaiby will manage the entire Alaska operation and particularly focus on stakeholder relations.

“Rick … (has) done a tremendous job. … He knows everybody,” Slaiby said.

Arctic Alaska’s challenges

Slaiby commented on the challenges that Shell faces in Alaska, especially the concerns about the possible environmental impacts of offshore oil and gas development. There are different opinions on offshore, he said, noting that Alaska Native corporations are fairly bullish on the opportunities the oil industry presents while the Northwest Arctic and North Slope boroughs have expressed reservations.

Slaiby believes listening to people’s concerns is critical: “The last thing in the world that we are going to do is to come in and tell everyone ‘we’re Shell, we know what’s the right thing to do and this is the way to do it.”

Slaiby’s background in the oil industry is in offshore operations.

“For me this really is something I have done and am very comfortable doing, but we have to recognize there’s a whole group of people who aren’t as comfortable as we are.” Solutions, he said, need to be acceptable to both Shell and the various stakeholders in the region.

“We think we’ll be able to put together a pretty good value proposition for Alaskans, with job opportunities and revenue opportunities, but it will take a lot of engagement and a lot of listening,” Slaiby said. “… We really have to be premier corporate citizens.”

In the past Shell has drilled in both the Beaufort and Chukchi seas without causing environmental problems, he said.

“Success is really measured in the fact that people don’t remember we’ve been here. That for me is a critical performance indicator. … Shell does have a fairly strong technical edge and an excellent track record of protecting the environment — it’s hugely important to us.”

The development footprints in the Beaufort and Chukchi seas will be very small, Slaiby said. “We are not an open pit mine. We will not have the footprint that you see on the slope … It is going to be an operation with modern technology, with extended reach wells, smart components built into the wells, modern platform construction.”

That approach fits well with the wishes of the North Slope and Northwest Arctic communities, he said.

And when it comes to working with those communities to address concerns about the potential impacts on subsistence hunting, Shell is building a portfolio of studies into baseline environmental data.

Meshes well with subsistence

Slaiby also said that work schedules for people who want jobs in an offshore industry would mesh well with the subsistence way of life.

“I think there are enough safeguards and I think there’s enough protection where we … can operate offshore and have a subsistence way of life,” he said. “For certain people it could be a real boon.”

The outer continental shelf, or OCS, is under federal control, so oil and gas revenues go to the federal government. Shell wants local and state governments to get a share.

“I really do think that’s hugely important,” Slaiby said. “We’ve got communities that I believe could benefit from that.”






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