Incoming Shell CEO orders overhaul, cuts jobs

[May 27, 2009]  AMSTERDAM (AP) -- Royal Dutch Shell PLC on Wednesday unveiled a major overhaul of its businesses and management that will affect thousands of jobs, part of a shake up ordered by the incoming chief executive.

Peter Voser, who takes the CEO job on July 1, said the changes would "increase accountability in the company and improve Shell's performance on delivering new projects."

Moves to combine the company's three production arms by product into two by geography will "reduce complexity, corporate overheads and costs, and result in faster decision-making," Voser said in a statement.

Shell wouldn't specify how many of the company's 102,000 jobs would be lost. A spokesman said the 2,000 employees at Shell's headquarters in The Hague would be strongly affected.

"Thousands of staff will be impacted," said spokesman Shaun Wiggins, referring to both job cuts and employees being asked to change location.

Shell's oil, liquid natural gas and oil sands production arms will be merged into two divisions by geography: one for the Americas and one for the rest of the world.

In addition, the company is creating a technology division that will oversee the development of new projects -- separating the startup phase of projects from the operational phase.

Vosper, who had been chief financial officer, will replace Jeroen van der Veer as CEO.

The head of Shell's liquid natural gas division, Linda Cook, resigned abruptly Tuesday. The company gave no reason at the time, but under the restructuring unveiled Wednesday, the operations she oversaw are being merged into other divisions.

Given greater duties in the new executive board are Marvin Otum, who will head the Americas arm, and Matthias Bichsel, who will lead the new technology division. Malcolm Brinded, the former head of exploration, will step sideways to head the international production arm.

[Associated Press; By TOBY STERLING]

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