Why Shell should go on a second US roadtrip

Royal Dutch Shell recognizes that the industry has ground lost in public perception of safe drilling by the oil spill in the Gulf.

Marvin Odum, head of Shell’s business in the Americas, said in an interview that the past few years of educational outreach by the industry – and its own safety record – had started to pay dividends.

People in the US were getting a clear picture of oil and gas and its importance to the energy mix and energy security. That is why, he said, President Barack Obama had moved toward opening more areas to offshore drilling when the disaster in the Gulf struck:

The progress we made on that point was very significant. This accident and this spill in the Gulf has clearly set that back. The industry has a tremendous amount of ground to be gained back with the public. We understand that.

He intends to do that by telling and showing regulators, politicians and others that Shell’s global drilling standards and operating procedures and culture of safety first allows for protecting the environment while meeting energy needs. Shell’s global standards, he argues, often exceed regulatory requirements.

This is an argument everyone has been making, but Shell recognizes decision makers must see and understand the effectiveness of this approach and he intends to show it to them.

Specifically, Mr Odum’s pitch for Shell to get back into the deepwater of the Gulf is that it has developed a rigorous training program for well engineers. Its contractors are required to take a systematic view of risk in drilling operations, and to put management system and mitigation plans in place for these risks before work begins.

Those plans require robust, multiple barriers between pressure regimes and the surface. And to make sure everything is being done correctly, Shell requires 24-hour/7 day-a-week remote monitoring in real time from a global network of real time operating centres.

This ensures oversight on critical issues, such as well pressure changes, and technical support to the drilling superintendent on the rig — who would be a Shell employee. Of course it is one thing to say all this and another thing to demonstrate it:

We really are an open door. I know it will be important for regulators to have a look and verify. I welcome this and transparency here is particularly important.

The pitch is certainly a step in the right direction. But perhaps more is needed. Outreach is something Shell is particularly good at.

Indeed, the company was probably most responsible for changing public perception about the oil industry in recent years when Mr Odum’s predecessor at Shell, John Hofmeister, spent from mid-2006 to early 2008 visiting 50 US cities.

The point was to meet with locals and give them a chance to air their views, ask questions of the industry and hear first hand why prices were high, why the majors were still pushing oil instead of renewables and whatever else was on their mind. ConocoPhillips launched a similar campaign, but Shell was considered the leader.

Nobody has said they will begin such an undertaking again.

But, given the protests against BP in different cities across the US and the whipping Big Oil got from Congress this week, it might not be a bad idea to take private conversations in the backrooms of Congress and the White House back into the town halls of America.

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