Royal Dutch Shell plc (NYSE:RDS.A) (NYSE:RDS.B)’s stock ticked upwards in early trading when Europe’s largest oil company announced that Ben van Beurden would succeed Peter Voser as chief executive on Jan. 1, 2014.
According to The New York Times, Van Beurden was not on most people’s radar as the choice to succeed Peter Voser. Better known candidates included: Andrew Brown, head of exploration and production; Marvin Odum, head of the company’s Americas business; and Simon Henry, the chief financial officer.
Van Beurden Appointment a Surprise
“This will be something of a surprise to analysts who widely expected” Mr. Henry to be chosen, said Peter Hutton, an analyst at RBC Capital Markets in London. “However, it was always clear that Shell would appoint the person it felt had the best combination of skills for the job, not necessarily the best known to the external community.”
Mr. Voser also shocked markets when in May of this year he announced that he would step down from his post to spend more time with his family after less than five years in charge.
Shell Pursuing Responsible Image
Royal Dutch Shell plc (NYSE:RDS.A) (NYSE:RDS.B) has distinguished itself as a company that, unlike its competitors, is willing to make long-term investments that produce steady streams of cash flow rather than betting big on the all-or-nothing business that is new oil exploration. Shell leads the world in liquified natural gas sales and has invested $40 billion in this area of its business in recent years, and hopes to cash in on growing use of gas in China and other emerging markets.
Ben van Beurden has been a big player for Royal Dutch Shell plc (NYSE:RDS.A) (NYSE:RDS.B) in its liquified natural gas business, and may account for the reason that others were skipped over when Shell announced his appointment today.
The man he is replacing did a good job righting the ship after Shell’s recent problems with misstating its oil and gas reserves, and it appears that Shell is interested in continuing the perception of responsibility that Mr. Voser built.
Liquefied natural gas business and Royal Dutch Shell plc (NYSE:RDS.A) (NYSE:RDS.B)’s gas-to-liquids business earned Shell $9.4 billion of its $25.1 billion in profit last year and its clear that Shell wishes to give investors the comfort in knowing that this will continue.
“Ben will continue to drive and further develop the strategic agenda that we have set out, to generate competitive returns for our shareholders,” Shell’s chairman, Jorma Ollila, said in a statement today.