Company Shell Case Study

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Main motives to be present in South-East Asia
The Company Shell was created because its founder Mister Zijiker found oil in South-East Asia (Sumatra) in 1883 and since then Shell is active in getting petroleum and natural gas from this region. Due to technological innovations in the industry, the political developments in these countries surrounding Southeast Asia and the arising of Japan as a hotspot for petroleum trade operations led that nowadays Southeast Asia has become the most active area of offshore exploration in the world (Wikipedia 2014). Nowadays in the Southeast Asian area the daily production of oil is at least 1.3 Million barrels and the production per year of natural gas is about 20 trillion cubic feet (Tcf) (Global Security
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They want to increase the use of renewable energy such as geo-thermal power and hydro-electricity. Biofuels is also expected to have a rapid growth in South-East Asia. Even though coal-fired energy is still an important power source in South-East Asia Shell tries to show the economic and environmental advantages of the natural gas as an energy source for the region in middle and long term. The region of South-East Asia has a long history in being a supplier of liquefied natural gas (LNG) and Shell believes that the export could be bigger even though the demand for this energy source is increasing in the home market of the suppliers. Also the product “Biofuel” will have an increase demand of it in the future and Shell wants to invest in Thailand because they have a strong agricultural base to support the growth of the biofuel industry (Shell …show more content…
One way is by forming Joint Ventures with other natural resources exploration firms. The second way is by signing legal agreements with the governments or with the competitors. The third way is to have their fully owned subsidiaries in the countries and they seek and explore the resources by themselves. With the joint-ventures shell shares research and technology information or they share the same exploration plant to obtain the energy source (Chemicals-Technology.com 2014). With the agreements Shell secure the rights that allow them to explore an area and the agreements are also helpful to divide the areas with other competitors and have everything legally correct (Offshore Energy Today 2014). An example of a fully owned by Shell production plant is the Shell Eastern Petrochemicals Complex plant that is a huge fully-integrated refinery in Singapore. Examples for Joint-Venture plants and projects are listed below.
• “Shell Eastern Petroleum Pte Ltd (SEPL) owns isopropyl alcohol (IPA) and hydrocarbon solvents plants on Pulau Bukom.
• Ellba Eastern Pte Ltd operates a styrene monomer/propylene oxide (SM/PO) plant. The company is a joint venture between Shell Eastern Petroleum (Pte) Ltd and BASF South East Asia Pte Ltd. It has an annual capacity of 550,000 tonnes of SM and 250,000 tonnes of propylene

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