Understanding the Success of Shell Oil Company

Founded in 1907, the Dutch Royal Shell has expanded into a global energy company that invested a net $30 billion in 2012. Americans know the company simply as Shell, and they most often interact with it to buy gas or oil. Shell’s business prospects for the year 2013 and near future are for new projects, global expansion, and innovation of green fuels.

Early History

Shell became the giant it is today after the merging of two businesses. The Dutch Royal Shell Group came to be in 1907 with the combination of Royal Dutch Shell Petroleum and “Shell” Transport and Trading Company. Respectively, they were originally from the Netherlands and the United Kingdom. Shell is now managed from the Netherlands.

Shell Oil Company manages the United States end of business for the Netherlands organization. The main commodity sold is gas and oil for automobiles.

Modern Shell

Peter Voser, the CEO of Shell, continually mandates that the core values of the company are kept current. Shell values honesty, integrity and respect. The role of ethics in business is widely promoted.

Shell has several projects due for 2013 after a successful year in 2012, which wrapped up a three year productivity plan. The plan resulted in $13 billion in acquisitions, 14 new projects, and a 10 billion barrel increase in oil reserves.

Their newer 2012 plans include a $6 billion investment in UK North Sea refining and a $3 billion investment in the Middle East. They also plan to explore deep-sea exploration for new sources of fuel. In five years they have invested $3.1 billion in clean energy technology research.

Company Organization

The Shell business strategy is divided into two conceptual parts. Firstly, their upstream system explores new sources of fuel for refining. As resource pools run dry, this is a important feature to the fuel industry. Secondly, they focus on oil refining techniques and future technologies. This also includes research for alternative fuel sources to crude oil. Solar and wind power are examples.

In addition, there is a downstream branch dedicated to distribution, sales and customer service. Shell had a revenue of $470.2 billion in 2011. They achieved this with 43,000 service stations in 80 countries. The company runs on the work of 80,000 employees. The downstream branch also develops new products.

Current Events

Recently, Shell has navigated its way through a difficult economy and protests in Alaska and Nigeria. CEO Peter Voser is confident that Shell will have steady growth through 2013 and beyond. He says that drilling must happen in Alaska in order to fuel the global economy. Political instability in Nigeria is being carefully handled by negotiators.

Nigeria has been the source of trouble for Shell, because of security problems. Crude oil is often stolen from the region. Recently, things have gotten worse. Shell plans on continuing business for the mean time. Additional money will be dedicated to resolving the issues.

Shell is pioneering the innovation of a technology called liquefied natural gas. This kind of fuel is clear and creates less pollution than traditional gas. A special refining process is being developed to create liquefied gas. The refining process cools the gas to negative 260 degrees Fahrenheit. This shrinks the gas into a liquid state. Refining plants will be located in Australia, Nigeria and Malaysia.

Modest yearly profits, well-founded business ethics, and a plan for the future make Shell a successful company since its foundation in 1907. It has a well-defined code of ethics and a focus on future green fuel technologies.

This article was written by Wes Salinski, a freelance writer and blogger who focuses on alternative fuel possibilities, automobiles, auto gadgetry, oil investment and other related topics; those interested in learning more should view Advance Diesel, a leader in power.

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