...Oil Companies: Where Should the Money be Spent? Jerrilynn N. Stanwood, Stephen Myers, Min Kim, Josue Fernandez, and Angel Paz California State University Long Beach Introduction Our case study was on major oil corporations and how they constantly advertise their business in the media but never present their mistakes to the public eye unless they just so happen to hit newspapers or television. Oil companies should always be concerned in making sure that all their equipment is running correctly and safety procedures are put into place in order to insure that they do not make any errors. This is especially true for off-shore drilling. Mistakes can cause great amounts of damage to wildlife and to people as well. An oil company that spends any amount of money advertising to the community about their work with the environment and endangered species should also be able to do the same and admit when they have make an error. Our group was faced with a question of whether oil companies should spend more time and money on preventing oil spills or building shelters for some of the endangered species and we found it more important to spend money on preventing the oil spills. Oils spills are always happening. They are mostly small but sometimes they can be large and catastrophic for both land and sea. An example of this problem can be related to BP’s 2010 oil spill caused by off-shore drilling. Big oil companies have “a powerful partner in the U.S. government, which isn't eager to see...
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...the energy sector * Dominant market position, top in market * Huge geographical reach * High quality global operations * Very strong brand name | Weaknesses * Cost of environmental hazards * Decline in crude oil and natural gas production * Reaching maturity * Controversies and criticisms * Negative perception | Opportunities * Increasing fuel/oil prices * Increasing natural gas market * More oil discoveries * Expand export market * Investment in the alternative energy business | Threats * Government regulation * High competition * Environment regulation * Increasing cost of operations | Environmental Analysis Macro environmental factors For the macro environment analysis we have chosen PESTLE analysis, which will give us details about the Political, Economical, Social, Technological, Legal, and Environmental analysis. 1. Political – Due to global warming issues and greater climate destabilization governments are creating a strong barrier on oil excavations; besides encouraging such industries into find out more sustainable forms of energy. Also on whole the energy market is becoming more volatile due to the treat of geopolitical instability. The global energy market is becoming more elastic due to continued oil demand from the thirds world countries. 2. Economical – Economy is supported by the energy reserves in that country. As well due substantial increase in the alternative energy sources supply are expected to grow in...
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...As monopolies ravaged the American economy, the American public demanded a response from the federal government. Starting with President Roosevelt, the regulation of trusts and monopolies increased and continued with later presidents. This new stance was adequate in dealing with monopolies. Muckrackers such as Ida Tarbell exposed countless trusts, one of them being the Standard Oil Company. In “The History of the Standard Oil Company”, Tarbell quotes Mr. Rockefeller as saying “This scheme is bound to work. It means an absolute control by us of the oil business. There is no chance for anyone outside.” By completely controlling the oil business, the core principle of American democracy was being violated, which didn't take the government long...
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...Running Head: PACIFIC OIL PACIFIC OIL CSU GLOBAL AMANDA BAUMAN The case study analyzing negotiations between Pacific Oil Company and Reliant Chemical Company it shows how the role of power can dictate the outcome of negotiations. Pacific Oil did not prepare properly for the negotiations they were entering with Reliant Chemical Company. By assuming Reliant was comfortable with their current contract Pacific failed to properly prepare for any unknowns that arose during the negotiations. Pacific oil was in need of a supplier for VCM in order to produce PVC, navigating a VCM market surplus, and how to navigate the start ups of various businesses. By not entering negotiations with a specific strategy or goals in mind Pacific allowed their selves to lose negotiation power with Reliant Chemical Company. When Pacific Oil Company and Reliant Chemical Company reopened negotiations, assumptions were made that delayed and cost Pacific Oil some negotiation power. As Pacific Oil prepared for the negotiations they failed to do the proper research and homework needed to create successful business plans. Pacific Oil did not understand Reliant’s need, or think ahead to what they might need when reconsidering their contract. By assuming Reliant was just as comfortable as they were with the existing contract conditions, Pacific lost time to gather the necessary information in order to fully understand Reliant Chemical Company. By not having a well thought out and understood negotiation...
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...Equals the sum of (a) reserves added from extensions and discoveries and (b) revisions of previous estimates, divided by production. Reserve life index or R/P ratio Equals the end-of-year reserve quantities divided by the current year’s production. Companies in the project and web addresses Anadarko Petroleum www.anadarko.com Apache Corp. www.apachecorp.com Chesapeake Energy www.chk.com Continental Resources www.contres.com Devon Energy www.devonenergy.com EOG Resources www.eogresources.com Southwestern Energy www.swn.com Successful Efforts Successful Efforts 1. Which accounting method for oil and gas properties is followed by each of the following companies? Full-Cost Full-Cost Anadarko Successful Efforts Successful Efforts Southwestern Continental Apache Corp Apache Corp 2. Which of the seven companies spent the most in the year 2012 for organic F&D costs? 12.58 12.58 What was the amount spent by this company (stated in billions of dollars)? Billions of dollars Devon, 2,963,000 MBoe Devon, 2,963,000 MBoe 3. Including all products (i.e., oil, bitumen, gas, NGLs), which of the seven companies had the most combined proved reserves as the end of 2012? 17,778,000 17,778,000 Stated in MMcfe’s, what were this company’s total proved reserves at the end of 2012?...
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...OIL COMPANY CRISIS Managing Structure, Profitability, and Growth Nick Antill and Robert Arnott Oil Company Crisis Managing structure, profitability and growth NICK ANTILL and ROBERT ARNOTT SP 15 Oxford Institute for Energy Studies 2002 The contents of this paper are the authors’ sole responsibility. They do not necessarily represent the views of the Oxford Institute for Energy Studies or any of its Members. Copyright © 2003 Oxford Institute for Energy Studies (Registered Charity, No. 286084) All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior permission of the Oxford Institute for Energy Studies. This publication is sold subject to the condition that it shall not, by way of trade or otherwise, be lent, resold, hired out, or otherwise circulated without the publisher’s consent in any form of binding or cover other than that in which it is published and without similar conditions including this condition being imposed on the subsequent purchaser. ISBN 1-901795-27-6 Cover designed by Clare Hofmann Typeset by Philip Armstrong, Sheffield Printed by Biddles, Guildford CONTENTS List of Figures Acknowledgements 1 2 INTRODUCTION INDUSTRY STRUCTURE 2.1 An Examination of Corporate Structure 2.2 The Urge to Integrate 2.3 A Question of Balance 2.4 Just how Operationally Integrated? 2.5 Are there...
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...Oil Company Inc Inc. Issue: Determining whether various events require the recording of a loss provision or expense accrual on Oil Company Inc Inc's year-end financial statements. Brief Background: Oil Company Inc Inc. operates in the oil industry and its operations sometimes result in soil contamination. Oil Company Inc Inc.'s policy is to clean up any contamination that it causes. New government regulations require Oil Company Inc Inc. to perform certain actions to be in compliance with these regulations. Issues: 1. Should Oil Company Inc Inc. record a loss provision for operations in a country in which no legislation exists related to contamination cleanup as of the financial statement date but is expected to be enacted shortly after year-end? 2. Should Oil Company Inc Inc record a loss provision related to contaminated soil in a country that has no environmental legislation? 3. Should Oil Company Inc Inc. record a loss provision for changes to the income tax system that requires it to retrain a large portion of its sales and administrative staff? 4. Should Oil Company Inc Inc. record an expense related to new legislation that requires that smoke filters be installed in its factories even though the filters are not required to be installed until six months after the financial statement date? Summary Conclusion on Issues 1. Since there is no current legislation requiring Oil Company Inc Inc. to clean up contaminated soil...
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...A Crack In The Mug: Case Study Don Tines I. Strategy: According to Starbuck’s website they see their primary target market as adults both men and women ages 25-40. This accounts for 49% of their total business. They are looking to attract a younger adult market ages 18-24. While it is true that Starbucks is selling coffee (high-quality coffee) that is only part of the story. They refer to their stores as “Coffeehouses” the real “sell” is the image they confer on those who patronage their stores. The “Starbucks’ experience” can be identified as genuine service and an inviting atmosphere where customers are invited to spend time socializing and collaborating with others of like mind. The “free” web hotspots allow customers to work, study, or play. The purchase of a $5 cup of coffee is soon forgotten as customers sit in soft living-room type furniture. Starbuck’s has come to distinguish itself through its high-end atmosphere and standardization. It’s quick service and good reputation for being environmentally friendly and for treating its employees well has won the battle for customer loyalty. It’s green logo and paper-bag brown colors has come to mean clean environmentally ethically friendly. Their image that this is “your store” “your private club” has contributed to its branding. II. Success Factors Starbucks Corporation was founded in Seattle, Washington a community known for its thriving economic strengths and home of Boeing, Microsoft, and Amazon. Seattle...
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...Shell is an Anglo–Dutch multinational oil and gas company incorporated in the United Kingdom and headquartered in the Netherlands. Created by the merger of Royal Dutch Petroleum and UK-based Shell Transport & Trading in 1907. By 2011, they became the second largest company in relation to revenue, growth and profitability in the oil and gas sector (Bruijn et al, 2002). The company operates in all areas of oil and gas industry, these areas include exploration of oil and gas, supplies and distribution, marketing, production, refinery, petrochemical development and power generation (McIntosh, 2001). The company is also concerned about environmental conservation, and it has invested heavily on the production, and distribution of renewable energy (Carroll, 1999). It supports initiatives of developing and distribution bio-fuel energy, wind and solar power, and hydrogen energy. The oil boom of the early 1920s, particularly at Shell’s Signal Hill, California site, provided the company with an opportunity to penetrate the Los Angeles area with sales of Shell gasoline and petroleum products manufactured in its new refineries nearby. In 1922, Shell Company of California and Roxana Petroleum merged with Union Oil Company of Delaware to form a holding company called Shell Union Oil Corporation. Approximately 65 percent of the holding company’s shares was held by Royal Dutch/Shell Group. Upon developing the ability to synthesize 100-octane gasoline, Shell began supplying this fuel to the U...
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...Code of Ethics: Shell Oil PHL 323 University of Phoenix June 10, 2014 Mission Statement for Shell Oil is statements that allows and offer a well diverse and direct message to all customers and employees. Shell Oil Company is a company that uses the code of ethics, or better known as employee code of ethics. They use the code of ethics to maintain a very truthful working environment and to make sure that all employees are all under a comfortable way of working and providing services to the customers. A happy employee offers a happy welcome and makes the customer feel good. In our opinion Shell Oil Company uses an end driven, with duty driven ethical system. There primary objective is to make the employees offer the best they could to the customers. It is mention that is a duty driven ethics because it makes sure that the employee know what is expected from them and with all it also understood what they are to expect from their superiors. The code of ethics are base rules and guidelines that enables the company to have a standards and to maintain a well functional dynamics that allows all the different areas accessible and to keep thing more of a black and white than having many grey areas. The code of ethics as guideline helps the employer to be able to stand before his employees and direct them neither in manner that allows them to understand that the company stands for many things and will not tolerate nor with...
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...i. Summary Royal Dutch Shell is a Dutch and British based company that in 2009 was named the world’s largest corporation by Fortune and world’s second largest corporation by Forbes. Stuck in a quagmire of violence and political issues in Nigeria, Royal Dutch Shell’s challenge was to establish socially responsible business practices to enable the company to sustain and expand its operations in Nigeria and the Niger Delta in particular. A conflict resolution and public policy consultant was brought in how to develop some constructive ideas on how best to address the problems Royal Dutch Shell faced in Nigeria. This case is intended to introduce students to some of the complex the complex issues faced by multinational corporations in developing countries. Although Shell is very lucrative company that makes millions of dollars a day, they would be very hurt to lose business operation base in Nigeria. Shell went from an egoistic operation in Nigeria to a benevolent and principle based operation. If Shell even took on a larger sense of social responsibility, they would have gained a larger competitive advantage over the competition. ii. Chronology 1. This case begins when Benjamin Aaron, a conflict resolution and public consultant, receives a request from one of his important clients, a potential new member to the board of Royal Dutch Shell, to provide advice on how to address the problems that Royal Dutch Shell faced in Nigeria. 2. The case goes on to review the turbulent...
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...WAL-MART STORES: “EVERY DAY LOW PRICES” IN CHINA Prepared by: Daniel Magen Report Distributed February 10, 2012 Prepared for Florida Atlantic University MAN 4602: Global Business Operations Spring 2012: F 9:30 - 12:30 Focus/Perspective Joe Hatfield, President and CEO of Wal-Mart Asia. Responsible for implement Wal-Mart’s business model Every Day Low Prices (EDLP) to China. Recommendation & Plan for Implementation Wal-Mart has to implement their business model EDLP and define a different strategy for Chinese market and culture. Internal & External Strategic Issues Wal-Mart faces several environmental, cultural, political, economical, social and legal issues and challenges that may act as obstacles for being successful in China. Several internal issues include: * Employees * Shoplifting Wal-Mart pays low salaries and does not offer any type of share for employees. As a result, high rate of managers turn over and unhappy workforce, makes very difficult reproduce domestic business model in China. Corruption and delinquency are very common in under developed countries. China is not the exception, having a high rate in corruption, is another obstacle for Wal-Mart to be efficient amd keep low prices. Several External issues include: * Chinese Consumer Behavior * Too Many Competitors * Diverse Population * Local Protectionism * Backward Infrastructure * Regulatory restrictions Chinese behavior in terms of consumption...
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...Shell Company Analysis Dr. Scruton Methodist University Management and Organization Abstract Shell Oil is a global company in the oil industry. This long established company has withstood the test of time in this competitive market. Management practices have established the resources necessary to overcome the obstacles of a global company. This detailed analysis of Shell Oil focuses on management in order to provide an understanding of how the company is able to succeed. The organizational analysis provides insight into Shell’s goals, culture, and resources. An example of a specific problem that Shell faced, oil spills in Nigeria, continues off of the company analysis. Nigeria is a major extraction location for shell, but sabotage and oil leaks grew to be a major concern. Shell faced court cases in search of relief in Nigeria, but the majority of the oil leaks were a result of sabotage; therefore, shell was not responsible. However, people believed that it was shell’s responsibility to safeguard the oil lines and prevent sabotage in the first place. Shell funded the cleanup of previous oil spill sites along with a major advertising campaign to avoid a negative impact on its business. Some people still believe that Shell should be taking more responsibility for the oil spill crisis in Nigeria. Shell Company Analysis Oil is a resource that has been in great demand since the production of combustion engines, as well as other industrial machines. Royal Dutch...
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...A Study of Shell Oil and its Stakeholders in Nigeria Part 2 (Week 9) A review of basic issues regarding the Background and Interests of Stakeholders of Shell Oil Company in Nigeria Somaya Rhoda 16069635 Chapter 1 Introduction In a major oil spill that occurred in the Niger Delta Region of Nigeria in 2008, Shell Petroleum Development Company (SPDC) stated that this was caused by a fault in a pipeline. In the town of Bodo, tens of thousands of oil barrels caused pollution to the land and creek. Shell’s official investigation report claims that 1,640 barrels of oil were spilt in total. Nigerian regulators have confirmed that the spill lasted for 72 days and estimate that between 103,000 and 311,000 barrels were spilt in this time. Besides the under-recording of this incident, Shell has repeatedly claimed to its investors, media and customers that the majority of the spill was caused by sabotage. Amnesty International has now confirmed that more than 50% of the oil spill was a result of operational failures. After more than 3 years since this oil spill, Shell has failed to perform a proper clean-up to the affected area, or to pay any form of official compensation to the affected communities. Thousands of activists in more than 14 countries have undertaken protests against the major oil giant, and the people of Bodo have now taken their claim of a leak of 500,000 barrels to the UK courts. Observing this particular situation involving Shell in Nigeria, an...
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...Describe the structure of Royal Dutch/Shell Group. Does it differ from the equity listings of other companies that you know? These equity listings are different from companies such as BP and Exxon. All subsidiary companies’ shares were held by the Group Holding Companies in the ratio of 60/40 (Royal Dutch/Shell). The corporate structure is outlined in the figure below. Individuals and Institutions Individuals and Institutions Royal Dutch Petroleum Company Netherlands 60% The “Shell” Transport and Co, PLC UK 40% The Shell Petroleum Company LTD. UK Shell Petroleum Inc. USA Shell Petroleum NV Netherlands Service Companies Operating Companies Shell Oil Company USA Individuals and Institutions Individuals and Institutions Royal Dutch Petroleum Company Netherlands 60% The “Shell” Transport and Co, PLC UK 40% The Shell Petroleum Company LTD. UK Shell Petroleum Inc. USA Shell Petroleum NV Netherlands Service Companies Operating Companies Shell Oil Company USA 2. What are ADRS? Why might companies find it attractive to issue ADRs? ADRS stands for American Depository Receipts, which is an underlying security that trades in the US financial markets. Foreign companies would find it attractive to issue ADRs because it would allow US investors to invest in their company, potentially increasing the value of the company. 3. Identify price differentials between different equity listings of the Royal Dutch/ Shell Group...
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