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Former DuPont chief takes over at Shell
[October 31, 2014]

Former DuPont chief takes over at Shell


(Guardian (UK) Via Acquire Media NewsEdge) Royal Dutch Shell has recruited the former chief executive of DuPont and former chairman of Bank of America Charles "Chad" Holliday as its chairman, to take over from Jorma Ollila, who will step down at the annual meeting in May after nine years in the role.



Holliday, 66, an engineer by education, will be the first American to chair the group, Europe's biggest oil company by market value. He spent most of his career at DuPont, having joined the US chemical company in 1970 and becoming chief executive 18 years later.

Under his leadership DuPont established a goal of decreasing its environmental footprint and turned itself from a chemical producer into a science-based products and services company. Holliday also headed the 10-member executive committee of the United Nations' and World Bank's sustainable energy for all initiative, launched in 2009.


The announcement came as Shell's profit rose strongly in the third quarter year on year, but the company warned it had yet to feel the full effect of the falling oil price. Shell's core profit, excluding one-time items, for the three months to the end of September increased 31% to $5.8bn (pounds 3.6bn) from a year earlier and beat market expectations.

The increase was down to new, more profitable production and lower exploration costs at the exploration and production business, along with a doubling of profit at the smaller refining and processing arm.

However, compared with the second quarter, profits were down 5% as the declining price of oil, which fell more quickly this month, started to take effect.

Shell's finance director, Simon Henry, said the quarterly results only reflected about a third of the big fall in oil prices, which averaged $103 a barrel during the period, and weakening demand was at least as big a factor as the abundant production from the US shale boom.

Oil companies have had billions of pounds wiped off their stock market valuations as oil prices dropped by almost a quarter over the past four months.

The price of crude has slumped to a four-year low of about $85 a barrel as supplies have outstripped slowing global demand, particularly in China.

Goldman Sachs slashed its forecast for Brent crude prices to an average of $85 a barrel for the first quarter of next year, down from its earlier estimate of $100 a barrel.

Henry said Shell would consider cuts to investment in projects where spending was flexible if the oil price stays low next year. It may also consider selling assets in the North Sea if it believes other companies would place a higher value on them.

Oil companies are selling surplus assets and cutting costs and investment spending to support profits as the outlook for the oil price weakens. Shell plans to shed $15bn of assets by the end of 2015.

Captions: Chad Holliday: first American chairman (c) 2014 Guardian Newspapers Limited.

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