Shell shock: CEO Peter Voser, 54, to retire early

LONDON: Royal Dutch Shell’s CEO Peter Voser will retire next year, the energy giant said in a surprise announcement, as it also unveiled a drop in first-quarter net profits blamed on lower crude oil prices.
Shell also announced a six-percent drop to its first-quarter net profits to $ 8.18 billion (6.21 billion euros).
Earnings after tax in the three months to March compared with $ 8.7 billion in the same period of last year.
The profit topped market expectations.
“Our industry continues to see significant energy price volatility as a result of economic and political developments,” Voser said in the earnings release. “Oil prices have fallen recently but Shell is implementing a long-term, competitive and innovative strategy against this volatile backdrop.”
Voser’s departure from a role he is seen to have excelled in came as a shock to investors, analysts and people inside Europe’s biggest oil company. Two senior members of staff said they had no inkling that he would go.
The softly spoken and widely respected Swiss national has helped drive Shell’s recovery from sector laggard to a leading position in the burgeoning industry of liquefied natural gas (LNG) in his nine years at the top of the company.
He took over as finance chief in 2004 amid the board-level upheaval that followed its dramatic downgrade of reserves estimates, becoming CEO in 2009.
His departure, scheduled for the first half of next year and announced along with first-quarter results, comes as the company and its industry face huge challenges.
Shell is the western world’s number two company by production behind Exxon Mobil.
But, like its peers, it is struggling to replace reserves and boost production, and faces a squeeze on earnings as costs rise while the price of oil threatens to fall decisively below the psychologically important $ 100 a barrel level.
Shell said it would look outside and inside the company for Voser’s replacement.
However, as with most big oil companies, new chief executives traditionally come up through the ranks.
Finance director Simon Henry refused to be drawn on his prospects for succeeding Voser.
Inside Shell, Henry is regarded as a potential front-runner along with Marvin Odum, the company’s head of upstream operations in the Americas.
Henry has a mathematics and accounting background even though, like Odum, he joined the company as an engineer, and is respected by shareholders who know him from his days as head of investor relations.
Odum, who is about Voser’s age, would be Shell’s first American CEO.
Andrew Brown, who became head of international upstream last year, could be a candidate too, as could director of projects and technology Matthias Bichsel.
One source said Brown’s relatively recent appointment may make him an outside bet, while Bichsel, born in 1954, might be considered too old for the job.
Voser said his decision to go was a personal one. “After such an exciting executive career I feel it is time for a change in my lifestyle and I am looking forward to having more time available for my family and private life in the years to come,” he said in a statement.
He has been named in media reports as a possible future chairman of Roche Holding, the drug firm based in his native Switzerland at which he is already non-executive director.
But Henry said Voser had indicated he had no plans to take on new non-executive directorships or chairmanships.
Henry said the company was well-placed to deal with the recent fall in oil prices. “We also think there are quite few players in the market, quite a few companies, who actually have bet the farm on $100-plus oil prices. We don’t,” he said.
Nevertheless, analysts say that among the world’s top oil companies, Shell spends more on exploration per barrel produced than any of its competitors. Its most high-profile exploration failure has been in Alaska, where it has spent $ 5 billion since 2006, and has yet to drill a single complete hole.