Sudden exit, but a job well done at Shell for Peter Voser

Chief executive's departure surprises the City but he has left the oil giant in better shape

Peter Voser's retirement as chief executive of Shell took the City by surprise yesterday, while his stated motivation of spending more time with the family initially sounded a bit fishy.

At 54, Mr Voser is arguably a little young to hang up his boots. And with 30 new projects under way and less than four years in the top job, he can hardly say his work is done.

But upon further reflection, analysts said Mr Voser's decision to retire in the first half of next year looks both reasonable and wise. Far from being a failure, they regard Mr Voser's tenure as a success, saying he looks set to leave the company in much better shape than he found it.

Furthermore, while the quietly spoken Swiss national may have only been chief executive since July 2009, he has actually spent 29 of the last 31 years at Shell, his company loyalty only compromised once during a short stint at ABB, the Swedish engineer.

Mr Voser was Shell's chief financial officer for five years before landing the top job – which he took in 2004 shortly after the company was caught inflating its oil reserves, which damaged its reputation at the time but has since been well and truly eclipsed by the woes of its arch-rival, BP.

Andrew Whittock, an analyst at Liberum Capital, said: "I'm surprised about Voser's retirement, but there is absolutely no reason to think there is anything else behind it. Voser has delivered beyond expectations, both operationally and in terms of projects."

Iain Pyle, an analyst at Sanford C Bernstein, said: "His main legacy will be starting up some really big developments – oil sands in Alberta, the Pearl gas-to-liquids venture in Qatar and the huge LNG [liquefied natural gas] project, also in Qatar. He has also expanded significantly into North American shale gas and oil."

Analysts praised Mr Voser for clearly identifying some key growth areas and focusing the company on them hard – an endorsement clearly shared by the market, which has pushed the company's shares up by more than 50 per cent during his tenure, making it Britain's biggest company and Europe's largest oil producer as its market value overtook BP's.

LNG is produced by freezing gas to 1/600th of its normal size for long-distance export, while the gas-to-liquids venture turns gas into diesel and other high-value oil products. Although the LNG market is in its infancy, it has the potential to become huge in the coming years as Asia in particular demands increasing amounts of gas.

Shell's business extracting oil from the Canadian tar sands is also thriving, but its scope for continued development is limited by the lack of a pipeline that would enable producers to transport much larger volumes of hydrocarbons over long distances, which would significantly increase its market. A 1,664-mile pipeline from Canada to Texas, the Keystone XL, is planned but is in danger of being blocked on environmental concerns.

Similarly, the fledgling market for shale gas outside the US – it is already highly developed in North America – is potentially huge, but Shell's progress in Europe and elsewhere could be hampered by concerns about the technique used to extract the hydrocarbons.

Gas, and increasingly oil, is produced from shale by blasting a mixture of sand, chemicals and water into the rock at high speed to release the hydrocarbons. The practice has been linked to earth tremors and water pollution.

The environmental concerns notwithstanding, Mr Voser has overseen significant progress in most of the areas he has targeted. But his tenure hasn't been an unalloyed success. Shell's six-year quest to produce oil in the Arctic has so far cost about $5bn, and has yet to produce a single drop of oil. A series of setbacks culminating in the grounding of the Kulluk oil rig off Alaska on New Year's Eve has badly damaged Shell's reputation, prompting questions about whether it will ever succeed in the Arctic. Shell insists it is committed to the region. Nigeria also continues to dog the company in the form of lawsuits relating to oil spills, thefts from its pipes and strikes.

However, Shell has had a far smoother ride than BP in the three years since the oil spill. Since then, Shell's shares have jumped by 12 per cent to give it a market capitalisation of £140bn. By contrast, BP's shares have fallen more than a quarter, valuing it at £80bn, as the spill badly dented its reputation and prompted it to sell more than $50bn of assets to meet the costs.

Even that might not be enough. BP has budgeted for about $42.2bn of spill-related costs but admits the eventual bill could be much higher – up to $50bn higher in a worst-case scenario. BP has stolen a march on Shell in the Arctic – finalising a deal in March with Russian oil giant Rosneft that left it with a 19.75 per cent stake in the company and an agreement to explore jointly in the region. But analysts say it has trailed Shell in the rapidly growing gas markets. "Shell has performed better than BP and is in better shape. BP has just been so heavily affected by the Macondo spill," says Mr Pyle.

Although Shell's oil reserves increased by about 2.5bn barrels to 13.2bn under Mr Voser, they still trail BP, at 16.8bn. But, while important, there is more to oil-company life than reserves. The early front-runner for Mr Voser's job looks to be Shell chief financial officer Simon Henry, who refused to rule himself out of the race yesterday.

In contrast to BP boss Bob Dudley, his most pressing task will be to carry on Mr Voser's work, ensuring the projects under construction come in on time and budget. It would also be good if he could clear up the mess in the Arctic.

Suggested Topics
Voices
A Russian hunter at the Medved bear-hunting lodge in Siberia
Save the tigerWildlife charities turn to those who kill animals to help save them
News
Davis says: 'My career has been about filling a niche - there were fewer short actors and fewer roles – but now I'm being offered all kinds of things'
PeopleWarwick Davis on Ricky Gervais, Harry Potter and his perfect role
News
i100
Sport
Frank Lampard will pass Billy Wright and equal Bobby Charton’s caps tally of 106 caps against
sportFormer Chelsea midfielder in Etihad stopgap before New York contract
PROMOTED VIDEO
Arts and Entertainment
The first film introduced Daniel Radcliffe to our screens, pictured here as he prepares to board the train to Hogwarts for the first time.
booksHow reading Harry Potter helps children grow up to be gay-friendly
Arts and Entertainment
A scene from Aladdin is performed at the Tony Awards in New York in June
theatreBrit producer Lythgoe makes kids' musical comedy a Los Angeles hit
Sport
Usain Bolt of Jamaica smiles and shakes hands with a competitor after Jamaica won their first heat in the men's 4x100m relay
sport
News
Chancellor George Osborne, along with the Prime Minister, have been 'complacently claiming the economy is now fixed', according to shadow Chancellor Ed Balls
i100... which is awkward, because he is their boss, after all
Life and Style
A small bag of the drug Ecstasy
Health
Life and Style
Floral-print swim shorts, £26, by Topman, topman.com; sunglasses, £215, by Paul Smith, mpaulsmith.co.uk
FashionBag yourself the perfect pair
News
news
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
Netherlands' goalkeeper Tim Krul fails to make a save from Costa Rica's midfielder Celso Borges during a penalty shoot-out in the quarter-final between Netherlands and Costa Rica during the 2014 FIFA World Cup
newsGoalkeepers suffer from 'gambler’s fallacy' during shoot-outs
News
people
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmReview: A week late, Secret Cinema arrives as interactive screening goes Back to the Future
Extras
indybest
News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Financial Analyst - Forecasting - Yorkshire

£300 - £350 per day: Orgtel: Financial Analyst, Forecasting, Halifax, Banking,...

Business Architect - Bristol - £500 per day

£500 per day: Orgtel: Business Architect - Banking - Bristol - £500 per day A...

Regulatory Reporting-MI-Bank-Cardiff-£300/day

£200 - £500 per day + competitive: Orgtel: I am currently working on a large p...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Day In a Page

Save the Tiger: Meet the hunters tasked with protecting Russia's rare Amur tiger

Hunters protect Russia's rare Amur tiger

In an unusual move, wildlife charities have enlisted those who kill animals to help save them. Oliver Poole travels to Siberia to investigate
Transfers: How has your club fared in summer sales?

How has your club fared in summer sales?

Who have bagged the bargain buys and who have landed the giant turkeys
Warwick Davis: The British actor on Ricky Gervais, how the Harry Potter set became his office, and why he'd like to play a spy

'I'm a realist; I know how hard this business is'

Warwick Davis on Ricky Gervais, Harry Potter and his perfect role
The best swim shorts for men: Bag yourself the perfect pair and make a splash this summer

The best swim shorts for men

Bag yourself the perfect pair and make a splash this summer
Has Ukip’s Glastonbury branch really been possessed by the devil?

Has Ukip’s Glastonbury branch really been possessed by the devil?

Meet the couple blamed for bringing Lucifer into local politics
Dress the Gaza situation up all you like, but the truth hurts

Robert Fisk on Gaza conflict

Dress the situation up all you like, but the truth hurts
Save the tiger: Tiger, tiger burning less brightly as numbers plummet

Tiger, tiger burning less brightly

When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

In grandfather's footsteps

5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

Martha Stewart has flying robot

The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

Do women cyclists need 'pootling lanes'?

Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

A tale of two presidents

George W Bush downs his paintbrush to pen father’s life story
Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

The dining car makes a comeback

Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

Gallery rage

How are institutions tackling the discomfort of overcrowding this summer?
Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

Eye on the prize

Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

Women's rugby

Tamara Taylor adds fuel to the ire in quest to land World Cup