The Guardian: 'I'm really very worried for the planet': Ron Oxburgh is chipping away at the fossilised thinking that cost Shell its reputation.

David Adam meets the geologist in a big business hotseat

Thursday June 17, 2004

It's a still day and the flags mounted on the imposing Shell corporate headquarters building on south bank of the Thames are lying limply against their poles, stirred only by the occasional river breeze. As they flutter it's easy to make out that distinctive logo against the blue sky, but it's also clear they could do with a clean - the famous red and yellow clam is lying on a distinctly off-white beach.

Shell has not had a good year; it has already admitted overstating its oil reserves, sacked its chairman and been forced to watch its marketing soundbite take a gleeful snap at the hand that created, raised and fed it as investors discovered they could no longer be sure of Shell. The company clearly has things other than laundry on its mind.

The man charged with rebuilding its battered reputation has other things on his mind too. Dinner. After three months pondering the barely perceptible rotation of the London Eye immediately outside the window of his new office, Ron Oxburgh is convinced that, with perfectly timed deliveries as the cabins briefly kiss ground level, the giant landmark would make an ideal riverside restaurant.

The views would be spectacular, he says, though on reflection the service could be a problem.

Oxburgh - strictly The Lord Oxburgh (he is a crossbench peer in the House of Lords and chairs its science and technology select committee) - was catapulted into his new role in March, replacing the ousted Philip Watts. As non-executive chairman of the UK half of the group, he is excused day-to-day running of the business, but is expected to steer it towards calmer waters, rebuilding city and public confidence along the way. Plans for the capital's latest revolving restaurant will have to wait.

Promoted from his long-standing post as a non-executive director, the 69-year-old geologist followed a formidable academic career with spells as chief scientific adviser at the Ministry of Defence and rector of Imperial College London. Sufficiently independent to restore some credibility to the office, and astute enough to know that it's more than his credibility that gives it a view stretching half way across north London, Oxburgh could be a smart choice.

He didn't volunteer for the role. "Not exactly, no," he says, relaxing on a sofa in the corner of the top floor office. "Situations come up. I was the senior non-executive director and normally that position doesn't have to do very much except when things go wrong. And things did go wrong."

He plays down his own role in trying to fix things: "There certainly are problems we didn't know about and we are now working for solutions in a whole range of areas. I'm just one of a team and I'm trying to help that team along." He claims that he only agreed to the job because Shell HQ is close enough to parliament to allow him to yo-yo between the two.

Shell's problems came at the start of what is shaping up to be a defining year for the oil industry. Political upheaval in Venezuela and no signs of improvement in the Middle East have combined to send crude values soaring, and the prospect of the £1 per litre price at the petrol pump have seen oil prices join house prices on the front pages of Britain's newspapers.

If Oxburgh thinks this is a sign of things to come, he keeps it to himself. "People who have tried to predict the future of oil prices in the past have generally speaking got it very seriously wrong," he says.

"The one thing that is clear is that oil is getting harder to find, and as more obvious resources are discovered and exploited it's going to get progressively more difficult."

High prices could help. "What will happen is that you'll find oilfields or pockets that were previously not regarded as economic, as the price goes up will become economic. If the price of crude stayed at $30 to $40 a barrel for a long time, and the world economy could sustain that, then a lot of oil would become economically extractable that hasn't been."

As an example he points to the Athabasca tar sands in Canada, vast deposits of clay, sand, water and bitumen reckoned to hold a third of the world's total oil reserves. "Those have been known about for donkey's years. When I was an undergraduate we were talking about the potential reserves in the Athabasca sands but nobody could see how to get the oil out," Oxburgh says.

Now, Shell and other companies are mining the solids and using new chemistry and technology to draw out the fuel. "The more the price of oil stays high, the more attractive these alternative routes will seem."

Attractive to oil companies and no doubt music to the ears of Shell shareholders, but to environmentalists who believe energy prospectors should be switching their attention to renewables, this increasingly desperate search for more hydrocarbons to satisfy our fossil fuel fix is a funeral dirge.

"The other major consideration that we have to take into account is the greenhouse effect and global warming," he admits.

We are on delicate territory here. Although Shell was one of the first oil companies to acknowledge the threat of climate change and has since pledged to cut its own emissions, public statements on the issue are carefully worded. Very carefully worded, and Oxburgh is more direct than the PR people further down the building might appreciate.

"No one can be comfortable at the prospect of continuing to pump out the amounts of carbon dioxide that we are at present," he says. "People are going to go on allowing this atmospheric carbon dioxide to build up, with consequences that we really can't predict, but are probably not good."

He believes the solution is something called sequestration, in which carbon dioxide from cars and power stations is captured and stored. "Sequestration is difficult," he says. "But if we don't have sequestration I see very little hope for the world."

It's an astonishing admission from someone - non-executive or not - at the head of one of the world's largest fossil fuel companies. The Norwegian company Statoil has been sequestering carbon dioxide underneath the North Sea for several years, but that is relatively pure gas released from a natural source nearby. Devising the technology to grab the gas from engine or boiler exhaust streams and finding the billions of pounds needed to pipe millions of tons offshore is another matter entirely.

"You might be right, the timescale might be impossible," he says. "In which case I'm really very worried for the planet." Oxburgh is unrepentant: "You can't slip a piece of paper between David King [the government's chief science adviser who said climate change was a bigger threat than terrorism] and me on this position."

In that case, apart from the undoubtedly generous salary, how does he reconcile being both concerned scientist and corporate oil tycoon?

"I don't think there's any conflict. I think it's much better that people with my views are actually in companies like this," he says. "I think there is an enormous dearth of people who are interested in science, excited by science, perhaps even understand a bit of science in the corporate world."

Oxburgh says he is used to ruffling corporate feathers with some straight talking. As a director, he helped to persuade the company to set up a social responsibility committee, which he headed.

"I think that in corporate organisations like Shell - but it probably applies to all sorts of other companies - you develop a corporate mentality and you can develop an insensitivity to some of the factors that weigh very heavily with people outside," he says.

"Multinationals are not popular but there are things you can't do without them, so you've got to have them. So how do you ensure that they are good neighbours where they operate, that people as far as possible are glad to have them there, that they act with respect to the local population? That's actually what the company wants to do but sometimes it just doesn't do it."

It's possible that this corporate sack cloth and ashes stuff is a deliberate ploy to distance the new regime from the old, and to start buffing up the company's image. But, as captains of industry go, it's hard not to like Oxburgh and easy to underestimate his influence.

Many at Imperial College did. As head of the college he pushed through controversial changes and earned a formidable reputation among staff and students alike. "A number of things I did at Imperial were not universally popular," he admits.

Still, he classes one of these as the most satisfying moment: "Being able to persuade a number of very distinguished, small and traditionally independent medical schools to come together and give up their traditional sport, which seems to be throwing knives at each other."

He now has less than a year to enjoy the spectacular view from his office window; next year corporate rules mean that he "becomes too senile" and must retire to spend more time with his rocks.

He's looking forward to it. "The thing I really enjoyed the most was being a field geologist," he says. Unsurprisingly, he has quite a pedigree and worked as a PhD student in the US with Harry Hess, one of the founding fathers of plate tectonics - the discovery that the continents slowly drift around the globe like oversized jigsaw pieces.

"When I got to Princeton and started my work there I began to see all sorts of things which I'd never dreamt of and got a glimpse of this revolution which at that time was just about to happen," he says. The idea was heresy to some - when a South African colleague discussed continental drift in a term paper: "The professor who examined the paper returned it ungraded saying 'this is a course in science not science fiction'."

Being eventually proved right on such a monumental scale must be seriously good for the ego; how can he now cope with people disagreeing with him over more everyday matters? "Oh, I have many more bad ideas than I have good ones," he says. "You like to be right but I've made all sorts of bad decisions. You just hope that you end up making more good than bad."

Shell will be hoping the same thing - but if the London Eye is turned into a restaurant any time soon, you know where the idea came from.

Life at a glance

Born

Ernest Ronald Oxburgh, 1934, Liverpool

Education

University College, Oxford (MA), Princeton (PhD)

Family

Married, three children

Career

Non-executive chairman, Shell; chairman, House of Lords select committee on science and technology; honorary professor, Cambridge University; fellow of the Royal Society. Awarded KBE in 1992 and made a life peer (crossbench) in 1999

He says

"There is a positive social responsibility on people from other backgrounds to participate in the corporate world"

They say

"Ron is an outstanding scientist and shaker-and-doer, combining real warmth and when necessary uncompromising toughness." Bob May, president, Royal Society

http://www.guardian.co.uk/climatechange/story/0,12374,1240704,00.html