Magazine Autumn 07 Full

8/3/2019 Magazine Autumn 07 Full

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2007

SHELL CHEMICALS

Shell Chemicals

Global scenarios

A long-term view of thefuture business environment

In safe handsLogistics contractor campaigndrives safety improvements

Paint by numbersVersatility of solvents helps resolvformulation challengesG ges

Global scenarios

A long-term view of thefuture business environment

In safe handsLogistics contractor campaigndrives safety improvements

Paint by numbersVersatility of solvents helpsresolve formulation challenges

Expert assetmanagementDecade of investmentcreates world-classpolyols complex

Expert assetmanagementDecade of investment

creates world-classpolyols complex


2/15

Service status

Sven Royall. Vice President Customer

Services and Intermediates, provides

updates on a major chemicals project

in Singapore, investment aimed at

unlocking the value of alternative

cracker feedstocks, and progress

on the implementation of REACH.

22Global engagement

Shell is taking a European engagement

programme designed to raise awareness

of the potential hazards

associated with handling

isocyanates to its polyols

customers in global

developing markets.

The move is part of an

overall commitment to

raising standards of

product stewardship

across the world.

URETHANE C HEMIC ALS

Sustainable strategies

A strategic relationship with a

major styrenics customer in one of

the key developing markets in India

has been built on both business

compatibility

and a shared

vision of

sustainable

development.

16

STYRENE MO NO MER

24

LOGIST ICS

FRONT COVER

The PO & Derivatives

complex at Pernis-

Moerdijk-in The

Netherlands has

undergone a decade

of investment.

hell Chemicals Magazine is produced forhe customers and contacts of Shell chemicalsompanies. It is published twice per year, coveringevelopments in the worldwide Shell chemicalsusinesses, and the chemicals industry in general.

ditorm Clarkel: +44 1322 280012-mail: [email protected]

Managing editorMichele Barrett, Head of Communicationshell Chemicals Limitedel: +44 20 7934 4175-mail: [email protected]

DesignNaked Vine

hotographyolin Whyman

einier GerritsenAshesh Shahrnst Bodeo Kun Hee

opyrighthe views expressed in articles identifying the author are those of theuthor and are not necessarily shared by the Shell Group of companiesthe editor. The copyright in an article identifying the author belongs to

e author and permission to reproduce such an article must be obtainedom that author. Permission to reproduce unidentified material should bebtained from Shell Chemicals Limited; this will normally be grantedrovided the source is acknowledged.

Shell Chemicals Limited 2007

isclaimerhe information contained in this publication is, to the best of ournowledge, true and accurate, but any recommendations or suggestionsat may be made are without guarantee, since the conditions of usere beyond our control. Furthermore, nothing contained herein shall beonstrued as a recommendation to use any product in conflict withxisting patents covering any material or its use.

hell Chemicalsach of the companies which make up the Shell Group of companieshe Shell Group or the Group) is an independent entity and has itswn separate identity. In this publication you will find the terms Shell,hell Chemicals, we, our and us. They should be read in their

ontext. They may refer to the Group as a whole; they may refer to onemore companies within the Group; or they may refer to the people

ho work for a particular Shell company or companies in a particulareographic area or in a particular area of business in which Shellompanies engage. The terms Shell Chemicals and Shell chemicalsompanies collectively refer to the companies of the Group that aredividually engaged in the chemicals business.

SN 1747-0706

inted in England by Evolve Complete Print Solutions.

nquiriesAll enquiries about this magazine should beddressed to the local Shell chemicals companyr to Shell Chemicals Limited, Shell Centre,ondon, SE1 7NA, UK.el: +44 (0) 207 934 4286ax: +44 (0) 207 934 7703

hell.com/chemicals

4

SHELL CHEMICALS

STRATEGY

12Back to the future

Nobody can predict the future,

but Shell develops Global

Scenarios - a range of

alternative futures - to act as

a guide and challenge to its

business decision-making.

Asset management

A decade of investment aimed at

maximising capacity, optimising

efficiency and strengthening the

competitiveness of polyols production

at Pernis-Moerdijk in The Netherlands

has created a world-class complex.

6

P O LYO LS

In this issue

10

Driving home the safety message

Initiatives aimed at contracted hauliers and

their drivers are helping to build a stronger

safety culture among logistics service

providers, in order to eliminate unnecessary

incidents during deliveries and unloading.

A Formula for flexibility

How the flexibility of solvents

can help the paint and coatings

industry address some of its

key formulation challenges.

20

SO LVENTSDrill skills

Emergency response exercises, using

simulated real-life scenarios, conducted

in conjunction with

ethylene oxide

customers are

proving key to

sharing knowledge

and experience for

responding effectively

to potential incidents.

SHELL CHEMICALS 3

ETHYLENE O X ID E

C USTO MER SERV IC ES


3/15

Roger Dauer, Lower Olefins Unit Manager, Alex Farina, Base Chemicals Strategy manager,

and Philippe Voyer, Lower Olefins Asset coordinator with a sample of hydrowax.

We are committed to ensuring REACH is workable and

a success - it will have long-term influence on our industry

and so we must get the initial implementation right

Sven Royall, Shell Chemicals Vice President,

Customer Services & Intermediates.

54

C U S T O M E R S E R V I C E S

Service status

t has been just over a year since theShell Eastern Petrochemicals Complex

(SEPC) projects groundbreaking, when

Singapore Prime Minister Lee Hsien

Loong and Rob Routs, Shells Executive

Director Downstream, signalled the start

of building work.

Since then activity levels on Singapores

Jurong Island and Bukom Island have

grown significantly. The majority of

construction contracts have been awarded

and the number of mobilised resources

is increasing daily.

When complete, the SEPC complex will

include a new 800 kt world-scale ethylene

cracker and a 750 kt mono-ethylene glycol

(MEG) plant. The project scope also

includes a 155 kt butadiene extraction

facility and modifications and additions

to the Shell refinery on Bukom (pictured).

PROJECT MANAGEMENT

This project, which is targeted for start-up in2009/2010, is not only a major part of our

growth strategy in Asia, it is also another

important opportunity to demonstrate Shells

ability to design, manage and deliver

a major capital project.

The project team faces a number of

challenges, not least because this project

is being built during a busy period of

economic development in Singapore.

Securing resources and equipment, and

arranging appropriate logistics to move

them in a relatively confined environment,

are significant hurdles.

Special measures undertaken include

the reclamation of land for the cracker,

Sven Royall, Vice President Customer Services and

Intermediates, provides an update on Shells major

chemicals project in Singapore and others designed to

maximise the sustainability of manufacturing operations,

progress on REACH implementation in Europe, and the

continuing focus on safety and product stewardship.

building of temporary dormitories to housearound 4,500 construction workers, and

re-commissioning of a ferry terminal to

move workers to the islands efficiently.

At the peak of construction the project will

require the services of up to 8,000 people.

Despite this, the project has progressed

well so far this year, and with an excellent

safety record. Piling work has reached full

capacity and some of the main structures

will start to be assembled before the end

of the year. Discussions with key potential

customers are also progressing.

Those involved are focusing a lot of

energy into maintaining momentum to

ensure that both the construction schedule

and safety record are maintained.

More information can be found on the

project website: shell.com/chemicals/sepc

TAKING FULL ADVANTAGE

The SEPC complex is based on our model

for world-scale manufacturing complexesthat leverage the integration that Shell, as

a major energy group, can achieve at sites

with both refinery and chemical operations.

SEPC will not only provide capacity to

support our glycols customers growth plans,

it completes the value chain between Shells

oil and chemicals interests in Singapore.

At Pernis-Moerdijk in The Netherlands

we are also investing in this oil-chemicals

advantage, including recently announced

plans to unlock the value of hydrowax as

cracker feedstock (see box right).

Europe, despite its conservative growth

rates, remains a heartland for our business

but to survive in this mature market you

have to be competitive. As well as seeking

out opportunities to secure advantaged

feedstock we have undertaken projects

designed to strengthen the efficiency

and sustainability of Pernis-Moerdijk.

The most recent will see the application

of the latest process technology for

production of polyols, which will unlock

additional capacity and make better useof our plant infrastructure. This is the latest

stage in a decade of investment in our

PO-Derivatives business at the site, which

has created a centre of excellence for

urethane chemicals. You can read about

this transformation on page 6.

PROGRESS ON REACH

Another major challenge facing all

producers in Europe is the implementation

of the REACH chemicals legislation.

Although the legislation only came into

force earlier this year, we have been

preparing for this for a number of years

and as a result we believe we have

made significant progress.

An inventory of products we currently

expect to register can now be found on

our website (shell.com/chemicals/reach),but we still have a lot of work to do to

finalise the details of how those products

will be registered. There are also many

loose ends and issues relating to the

complexity of the legislation and its impact

on the competitiveness of the European

industry and individual companies.

Shell has contributed significant

resources to, and played an active role

in, the sector groups and industry bodies

that are addressing these issues. As chair

of CEFICs Product Stewardship Council,

I have also been personally involved in

some of these discussions.

We are committed to ensuring REACH is

both workable and a success. It is going

to have a long-term influence on our

industry and its important that we get

the initial implementation right.

We support the underlying goals of

REACH because they are consistent with

our commitment to promote the responsibleproduction, use and handling of the

products we make.

That commitment goes beyond

compliance with regulations, however.

In this issue you can read about some

of our voluntary product stewardship

programmes including: the emergency

response drills we conduct in conjunction

with ethylene oxide customers (page 10);

efforts to drive safety performance

improvements with contracted logistics

providers (page 24); and how we are

taking industry best practices for handling

isocyanates to polyols customers in key

developing markets (page 22).

A significant investment is being

made at the Pernis-Moerdijk

complex in The Netherlands to

enable the sites cracker to utilise

refinery hydrowax as feedstock.

It is part of a strategy to strengthen

the oil-chemical integration at the

site and so maximise its long-term

competitiveness.

The project involves using hydrowax

produced at the Pernis refinery, andpotentially other refineries in Europe,

to replace naphtha that currently has

to be imported into Moerdijk.

Hydrowax is a by-product of the

refinerys hydrocracker but can offer

significant advantages compared to

conventional ethylene feedstocks,

explains Alex Farina, Strategy

Manager for Base Chemicals.

Its high hydrogen content produces

a similar yield to naphtha but at

lower cost. Redirecting the hydrowax

from Pernis is an example of how

we can leverage the close integration

with oil refining activities.

The investment will focus on some

alterations to the cracker furnaces

and developing the logistics to

transfer the feedstock.

We have used hydrowax before

as a feedstock but never on this

scale or in such a systematic

fashion, explains Philippe Voyer,

Lower Olefins Asset Coordinator.

Hydrowax is a little like candle

wax and solidifies if allowed tocool, which means it has to be

heated to maintain its liquid form,

he explains. Part of the project

will involve using heated storage

tanks and shuttle barges to move

the feedstock the short distance

from Pernis to Moerdijk.

The project is expected to be

completed during the first quarter

of 2009. Graham vant Hoff, Vice

President Base Chemicals Europe,

said: This investment is key to

ensuring Pernis-Moerdijk remains

one of the most competitive

petrochemical complexes in Europe.

I

INVESTING IN ADVANTAGED FEEDSTOCKS

SHELL CHEMICALSSHELL CHEMICALS


4/15

6 7

P O L Y O L S

ork recently began on

a project at the Pernis

polyols complex that will

see the application of thelatest continuous process technology for

manufacturing advanced grades for

flexible foams.

It is the latest stage in the development

of the complex, which has undergone

a decade of continuous investment and

improvement with a focus on advanced

process technology, manufacturing

integration and sustainability.

The new continuous process technology

will boost output of flexible polyols by 100

kt per year, taking Shells total worldwide

polyols production to over 400 kt per year.

This project is the culmination of a

significant capital investment programme

focused on reinforcing the position of

Pernis as a world-class facility, says

Sonia Michiels, Global Business Manager

Propylene Oxide and Derivatives (PO-D).

It builds on the advantages of feedstock

integration, leading technology and strong

supply chain and logistics operations thathave been developed at Pernis, along

with a team of people that has extensive

knowledge and experience in the

production of urethane chemicals.

OPTIMISED ASSETS

The development of the polyols production

facilities at Pernis has reflected the growth

in key global markets. Capacity increases

have been achieved by a combination

of optimising existing assets and adding

new plant infrastructure.

We have rationalised some assets while

growing overall capacities by adding

new units and applying advanced process

W

technology in debottlenecking projects,

in order to respond to demand from

customers in a sustainable way,

says Michiels. This has maximisedour competitiveness and enhanced

the efficiency of our business in what

is a tough, competitive market.

She says the expansion of Pernis has

been a key driver behind Shells rise

from one of the top ten polyols producers

in the world, to one of the top three.

STRATEGIC IMPORTANCE

The strategic importance of the site is

a direct result of investments in propylene

oxide (PO) capacity Shell has made at its

adjacent Moerdijk petrochemicals facility.

Moerdijk has two world-scale SM/PO

plants - one wholly-owned by Shell and

the other a manufacturing joint venture -

with total PO capacity of over 450 kt, a

large portion of which is sent to derivative

plants at Pernis.

Access to secure supplies of PO, and

careful management of the interaction

between feedstock and derivative plants iscritical for sustainable, competitive polyol

production, says Jean-Claude Vandichel,

Special Projects Integrator for PO-D.

We have been able to leverage a high

level of integration at Pernis due to the

easy access to both Ethylene Oxide (EO)

and PO from the world-scale plants at

Moerdijk, as well as upward integration

with the sites cracker and refinery.

Large-scale polyols production was

developed at Pernis back in the 1970s

and 1980s with the construction of three

flexible polyol lines during that period.

The current investment programme began

in 1999 and included the startup of

More than 10 years of investment and development has turned the polyether polyols

complex at Pernis in The Netherlands into a centre of excellence for the production of

urethane chemicals. It has resulted in one of the most advanced, integrated facilities

in the world, equipped to respond to market growth and customers changing needs.

Operational teams at Pernis have extensive knowledge and expertise in the

production of propylene oxide derivatives.

A decade of investment and improvement at Pernis has significantly improved

its capacity, efficiency and competitiveness.

Sonia Michiels, Global

Business Manager

Propylene Oxide

and Derivatives.

By focusing our resources in Pernis we have created a

world-class manufacturing complex, and are also delivering

on our strategy to provide customers with the products they

need in the most sustainable and efficient way

Asset management



5/15

8 9

Were moving from a batch to a

continuous production process in order to

deliver the additional capacity we need,

and to produce base polyol grades in

a more efficient and sustainable way,

explains Vandichel.

This project has the added advantage

that it enables us to bring additional

capacity onstream within a relatively short

time frame. The new capacity is expected

to be in place by the second half of 2008.As a result, overall output of flexible

polyols at the site will increase from

155 kilo tonnes to 255 kt per year.

This will help to solve some of the

capacity constraints in Europe while also

strengthening our global supply position,

says Vandichel. Demand for polyols

globally is growing by 4-5% per year.

The sustainability of manufacturing

operations has been at the heart of

all polyols investments at Pernis.

Our philosophy of making optimal use

of existing equipment, instrumentation

and infrastructure, and applying advanced

process technology, has delivered a range

He says there has been significant

investment to support the transfer of

production. Parts of the polyols complex

at Pernis have been upgraded and

debottlenecked to enable the production

of essential CASE grades.

UNLEASHING POTENTIAL

The latest phase in the development of

the complex will help to unleash further

potential from its assets and infrastructure,

and reinforce its long-term sustainability.

The application of continuous process

technology for producing flexible polyols

is a direct response to growth in key

markets. Increased demand is the result

of both organic growth in the slabstock

foam industry in Western Europe and

increasing influence from companies inEastern Europe, Middle East, and Africa.

Western Europe is moving towards

more differentiated base polyol grades for

premium foams, while Eastern Europe and

other developing markets are taking an

increasingly larger share of the commodity

polyols market, says John van Kesteren,

Flexible Polyols Product Manager.

Making additional capacity available

is part of a commitment to supporting

existing customers growth plans, and to

strengthen those long-term relationships.

The expansion will be based on making

optimal use of existing assets, by using the

latest process technology.

For more information about theCARADOL range of polyols visit:

shell.com/chemicals/caradol

a new rigid polyols plant - doubling rigid

polyol capacity and incorporating the

most modern manufacturing processes.

This plant introduced a totally new

concept in rigid polyols production,

explains Vandichel.

Its design delivered more control over

processes and increased the capability for

producing tailor-made base polyol grades

for rigid foams used in applications like

insulation, appliances and construction.

A further significant expansion came in

2003 with the startup of a new polymer

polyols plant, one of the largest of its kind

in Europe, which marked an important

development in this high growth sector

of the urethane chemicals market.

Polymer polyols are standard flexible

polyols modified using polymer suspensiontechnology, to produce harder, more

durable and more comfortable foams.

The Pernis plants range of CARADOL*

styrene acrylonitrile (SAN) polymer polyols

are produced using Shell technology.

PREMIUM GRADES

Recent years have seen a shift in focus to

production of polymer polyol grades due

to the significant increase in demand for

higher performance foams for premium

furniture, bedding and automotive

applications.

Foam producers have increasingly used

polymer polyol grades because they can

produce foam properties that cannot be

achieved using standard flexible polyols

alone, explains Vandichel. They deliver

improved levels of comfort at lower

formulation cost, and now account for a

significant portion all polyols sold globally,

making them an essential part of ourgrade range.

Other investments at Pernis have been

aimed at improving product quality and

responding to specific application

requirements.

The installation of a special unit to remove

VOCs (volatile organic compounds), which

are formed as by-products during the

production of flexible polyols, has helped

to raise the quality of foam products. The

presence of VOCs in polyols can create

an odour in finished foam which although

harmless is perceived as undesirable

in some consumer applications.

Special technology employed on

the SAN polymer polyols plant also

ensures that these high performancegrades are compatible with the latest

liquid carbon dioxide (CO2) foaming

equipment increasingly used by customers.

Last year the integration of polyols

production was further enhanced by the

decision to transfer production of CASE

(Coatings, Adhesives, Sealant and

Elastomers) polyol grades from

Carrington in the UK to Pernis.

This move allowed us to consolidate our

European polyols production at Pernis and

to maximise asset utilisation. It has brought

production of all grades of polyols rigid,

flexible, polymer and CASE into one

single integrated location, says Vandichel.

P O L Y O L S

of benefits from improvement in energy

and water consumption, to reduced

carbon dioxide emissions and waste

generation, says Sonia Michiels.

The expertise of specialist polyols

operations and production personnel

at the site has also led to improvements

in product quality and consistency, as

well as an impressive safety record.

By focusing our resources in Pernis

we have not only created a world-classmanufacturing complex, we are also

delivering on our strategy to provide

customers with the products they need in

the most sustainable and efficient way.

*CARADOL is a registered Shell trademark.

The expansion of Pernis has been one of the key

drivers behind Shells rise to one of the top three

polyol producers in the world

Assistant Plant Manager Nelke Van de

Ven in one of the sites control rooms -

advanced process control is one of the

keys to unlocking the sites potential. Jean-Claude Vandichel, Special Projects Integrator - leveraging the benefits of integration.



6/15

10 11

E T H Y L E N E O X I D E

said Reinhold Brand,

President of Goldschmidt.

This exercise provided us with

an opportunity to both evaluate

the skills of our staff, and to see how

local emergency services would respond.

The drill at Hopewell involved a

simulated emergency resulting from an

EO spill from a railcar. This is one of a

number of realistic scenarios we are able

to recreate, and we tailor the exercise to

fit the customers facilities and training

objectives, says Amelia Hung, Shells

Global Product Steward for EO.

Were preparing for something we hope

never happens but we want our customers

and their local emergency response crews

to understand the potential hazards and

the proper way to respond if there is

a leak or spill, she says.Examining response procedures under

a simulated real-life scenario can be one

mergency response exercises have

become part of an established EO

product stewardship programme

developed by Shell in the US.

While the auditing of customer premises

for general HSSE (health, safety, security

and environment) standards is a mandatory

condition of business terms, emergency

response drills are voluntary and can be

organised at the request of customers.

We regularly conduct emergency drills

at our own facilities and have built up a

lot of knowledge and expertise in dealing

with potential incidents, explains Renee

Lampkin, Americas EO Product Manager.

Drill skillsHigh standards of product stewardship by both supplier and user are essential

for a product such as ethylene oxide (EO). A joint exercise with Degussa,

designed to test emergency response procedures, is an example of the

ongoing commitment to sharing and exchanging knowledge and

experience on safe product handling with customers.

EBy sharing that experience through

joint exercises with our customers we hope

to help raise overall standards of product

stewardship across our industry.

To our knowledge were the only EO

producer that offers this as a service and

have found that our customers welcome the

opportunity to learn from such exercises.

She says serious incidents involving EO

are thankfully rare despite the volume of

product moved across the US. This means

there is limited real-life experience, and so

exercises involving simulated incidents are

vital for effectively testing and practicing

the skills for dealing with them.

The drill at the Hopewell, Virginia, plant

of Goldschmidt Chemical Corporation and

Degussa Corporation, both subsidiaries of

Evonik Industries, was arranged after an

employee attended a previous Shell training

class as a guest. Degussa recognised the

value of this type of exercise for the sites

own emergency response training. We

have a longstanding relationship with

Degussa and it shares the high priority

we put on safety, says Lampkin.

Degussa uses EO as an intermediate in

a range of chemical products. Making

sure we are fully prepared to respond to

a chemical emergency is important to us,

of the most effective ways to do this.

As part of the exercise, the sites first

responders had to deal with the immediate

aftermath of the spill, establish an incident

command post and notify local emergency

services. As the scenario played out the

responders had to retrieve and treat the

injured, dilute the spill with water and

manage the containment of the incident.

This gave us opportunities to practice

techniques and teamwork so that in the

event of a real incident, each organisation

is able to perform and work together,

said Russell Mait, Goldschmidts Director

Environmental, Health, Safety and Quality.

All participants took the exercise

seriously. Each step of the unfolding

scenario, including the use of

decontamination showers, was carried

out as though it was real, says Hung.During the drill, Shell observers -

including experienced emergency response

team members from Shell sites - evaluated

the performance of the Hopewell plants

personnel and local emergency crews in

dealing with the incident.

TWO-WAY LEARNING

Hung says there are always valuable

learnings to be gained from the exercises.

We conduct one or two of these drills

every year and each one highlights

something new. Its a two-way learning

process theres always something for

both us and the customer to take away.

Its not just about the sites response to

an incident, its also about how they work

and communicate with local emergency

services who may have the primary

responsibility for dealing with it.

Following the drill the Shell observers

provided a full critique of the response.Its not a test and theres no pass or

fail score, says Hung. Its more about

discussing the response, highlighting

any potential gaps and encouraging

suggestions for improvement.

Lampkin says these exercises, in addition

to mandatory safety reviews and other

HSSE initiatives, are key to the continual

evolution of EO product stewardship.

These exercises take a lot of effort and

organisation but our experience suggests

they are invaluable for raising awareness

and understanding of safety issues related

to handling EO, and for continually raising

standards of product stewardship.

The participation of emergency services not only adds realism to the exercise, but is

also essential to test how effectively the site coordinates with local fire and hazmat crews.

First responders move in to retrieve the injured during the simulated emergency scenario, while water is sprayed to dilute the spill.

For more information on ethyleneoxide please visit:

shell.com/chemicals/eo

Examining procedures

in a simulated real-life

scenario is one of the

most effective ways to

test understanding of the

proper way to respond in

the event of an incident



7/15

our decisions. To do that we have to

understand better the various conditions

under which we may have to operate in

different regions or circumstances.

Shells Global Scenarios explore the

global business environment, while Shell

Energy Scenarios drill down into the

dynamics of the energy system.

Building and using scenarios helps us

explore what the future might look like and

the likely changes to living in it. It makes

us more open to change and more likelyto survive and thrive than an organisation

that is continually chasing events.

As well as being a valued business tool

for Shell, the Global Scenarios have an

excellent reputation around the world for

broadening and stimulating discussions

across the global business community.

LATERAL THINKING

In developing scenarios Shell draws on

a diverse combination of lateral thinking

and hard data from accredited sources.

In addition to experts from Shell, input is

gathered from a wide range of individuals

and organisations from business,

S T R A T E G Y

academia and research, at both local

and global levels. Notable economicsources include the World Bank and

International Monetary Fund.

Patterns or trends that have emerged

from the past may also offer pointers

to the future, but there are also critical

uncertainties faced by societies that may

be resolved in several possible ways.

Because there is no single answer to such

issues, the scenario builders create sets

of scenarios, each one describing a

different way in which the uncertain

aspects could play out.

RELEVANT CHALLENGE

We dont like to discount anything

upfront, but nor do we invent potential

future events, explains Thomas. Good

scenarios are ones that explore the

possible, not just the most probable from

todays perspective. They should provide

a relevant challenge to conventional

wisdom and help to prepare us formajor changes ahead.

In the 1990s, the Shell Global Scenarios

explored a world dominated by the forces

of globalisation, new technology and

market liberalisation. Those developed at

the start of this century set out two worlds:

one driven by efficiency, economic

integration and a different role for nation

states; the other by the enduring power

of cultural values and social cohesion.

GLOBAL SCENARIOS TO 2025

The most recently published Shell scenarios

- Global Scenarios to 2025 continue

these themes but put them into

the context of recent geo-political,

economic, and social aspirations and

forces that are shaping our future.

Specifically, they take into account two

crises that have unfolded since 2001 -

namely 9/11 and the Enron collapse -

that have fundamentally affected peoples

trust in security and the marketplace.

Insecurity and mistrust that have arisen

in the light of these events have led to

new barriers to the free movement

of people, but not goods and capital, as

well as a stronger role for the state both

in protecting national security and in

restoring trust in the market.

1312

Wim Thomas from the Shell Global Business

Environment team responsible for developing

the Shell Global Scenarios.

Back to the

Nobody can predict the future but energy companiesneed to take a long-term view of trends or events

that might impact markets and economies. The Shell

Group develops Global Scenarios, which offer a

plausible range of alternative futures, to challenge

and inform business decision-making. Read on for

a view of what the future might hold

hell has been developing and

using scenarios for 30 years

to gain deeper insights into its

global business environment, to

identify emerging challenges and

to foster adaptability to change.

The scenarios are not forecasts or

predictions, but rather credible alternative

views of what the future might look like,

which can be used to review and assess

business strategy.

Scenarios help us explore the manycomplex business environments in which

we work and factors that drive changes

and developments in those environments,

explains Wim Thomas from Shells Global

Business Environment team.

They help to bring clarity and simplicity

to often highly complex issues and prepare

us for potential discontinuities and sudden

change in the global business environment,

such as political upheaval or new and

emerging technologies.

We face real challenges in the future

and we need to be able to respond

to changing environments and make

informed and rigorous assessments of

S

FUTURETwo crises have unfolded since 2001-

9/11 and the Enron collapse - which have

fundamentally affected peoples trust in

security and the marketplace

Events such as 9/11 and the Enron

collapse have had a fundamental impact

on global business environments.



8/15

A legalistic world where the

emphasis is on security and

efficiency, at the expense of social

cohesion. Globalisation continues at

a slower pace due to increased state

regulation and legislation. Goods

and capital flow but with lower

levels of market innovation because

movement of people is restricted:

This is a prove it to me world,a sceptical world. The key words are

compliance, compliance, compliance.

Its about playing by the rules.

A world of lawyers and accountants

with a culture of blame: when things

go wrong, regulation and litigation are

seen as answers. Action is reactive

rather than proactive.

Heavy compliance requirements bring

high transactions costs in markets and

foster greater business scale: markets

are dominated by large, vertically

integrated companies that are able to

control potential liabilities in the supply

chain. Value protection is as important

as value creation. Compliance and its

cost and scale implications also create

large barriers to market entry by

small and medium-sized companies.

The absence of trust leads to rapid

regulatory change, overlapping

jurisdictions, conflicting laws andintrusive checks and controls.

A dogmatic world where security

and community values are

emphasised rather than economic

efficiency. National values dominate

at the expense of economic growth,

with people retreating behind

national gated communities,

resulting in decreased transparency

in markets and societies:

Flags is a follow me world, wherepeople are dogmatic about their codes

and causes.

Although still interconnected with the

rest of the world, people feel a stronger

need to express their own identity in

terms of the group/club/nation/religion

to which they belong.

A pragmatic world that emphasises

social cohesion and efficiency, with

the market providing built-in

solutions to the crises of security

and trust. Trust is restored and

there is high economic growth:

Open Doors is a know me world, a

world of trust: in global systems, and in

globalisation. It is a pragmatic, proactive

and co-operative world.

In this world, government acts in the

background, maintaining trust and

security through incentives and soft power

rather than intrusive checks and controls.

States are inclusive, taking responsibility

for the wider constituencies in society.

Reputation can be a substitute for

intrusive controls. Reputation carries a

premium, but also makes companies

vulnerable. Voluntary best-practice codes,

and close links between investors and civilsociety encourage cross-border integration

and virtual value chains. Networking skills

and reputation management are essential.

Competitive advantage through

innovation is short-lived, but not to

innovate is not an option. Companies are

driven to innovate in order to compete.

More capital is available to invest in

innovation because financial markets have

a higher appetite for risk. There is faster

dissemination of innovations because of

the open global business environment.

Global equity markets become more

integrated and large sums of venture

capital chase superior returns.

LOW TRUSTGLOBALISATION FLAGS OPEN DOORS

Different scenarios,different worlds

More recently, the rapid export-led

growth of developing countries

and their impact on global demand

for energy and other commodities has

helped to fuel a new wave of resource

nationalism, as well as a rise in

protectionist pressures in Western

Europe and North America.

NAVIGATING COMPLEXITY

These changes make the interactions

between market participants, states and

society more complex. The Global

Scenarios to 2025 provide a way of

navigating through that complexity byoutlining three sets of forces - market

incentives, the force of community, and

coercion and regulation - and how these

drive towards the societal objectives of

efficiency, social cohesion and security.

These objectives are, at times, in tension

with each other and the scenarios explore

the resulting trade-offs that are needed to

reconcile them, setting out what is called

the Trilemma (see Fig 1).

The Trilemma provides a map of

relations and interactions among market

participants, civil society and states.

In particular, it examines the interplay

of three complementary, but occasionally

S T R A T E G Y

competing societal objectives.

Three Global Scenarios or possible

futures Low Trust Globalisation, Flags

and Open Doors - offer a way to

capture the interactions between the three

sets of forces and the subsequent trade-offs

and choices that may shape the business

environment over the long term (see right).

These scenarios are broad pictures of

the world. Some countries may oscillate

between the scenarios, or particular

scenarios may be more prevalent in some

parts of the world than others. This means

it could become more difficult for

companies to adopt global standards,or they may require different business

14

The sometimes complex interplay between the three sets of Global Scenarios and the societal forces

and objectives of efficiency, social justice and security.

structures in different parts of the world.

And although these scenarios look to the

future, they can also be used to put todays

events into context in order to better

monitor and interpret them. Such analysis

could point to the possible future direction

of the global business environment and

whether one or more of theses scenarios,

or indeed combinations of scenarios, are

beginning to emerge.

In this way the scenarios themselves can

be reviewed, and if necessary, challenged

as we move towards 2025, says Thomas.

From the signposts we get from current

events, there are clear indications that thethree fundamental objectives and driving

forces of the Trilemma are shaping todays

world. The eventual balance among these

forces, examined in the three Global

Scenarios, will determine the direction

in which the world goes.

Good scenarios are

ones that explore the

possible, not just the

probable. They should

provide a relevant

challenge to conventional

wisdom and help toprepare us for major

changes ahead

15

Flags is fragmented and polarised

both internationally and domestically.

People distrust others with whomthey cannot closely identify.

Opposing groups try to capture the

state for their own objectives - by votes,

violence or money. Or governments

wave the national flag, encouraging

unity by reminding them we all belong

to the same country. Careful country-

risk management is a priority.

Security is pursued through isolation

and gated communities. Global mobility

of people and money, hence trade,

is seriously hampered.

Businesses with strong national

identities fare well and are granted

state protection.


For more supporting information onthe Shell scenarios please visit:

www.shell.com/scenarios


9/15

S T Y R E N E M O N O M E R

to gaining the trust and confidence of the

community. From the outset we realised

that if we did not have the support of local

people if they did not see improvements

in their lives - we would not be able

to grow our operations here.Ern-Teng Phua, Shell Chemicals SM

Sales Manager for Southeast Asia/India,

says SPLs commitment to SD is on a scale

that is not yet common in emerging markets.

It has clearly recognised the business

value of SD, not just for improving

a companys image but as a critical

enabler of growth, he says.

SPLs presence has been the catalyst

for the creation of a range of small

businesses, from plastic processors,

contractors and suppliers, to haulage

companies and even travel agents.

The company has also actively sought to

involve the community in the running of its

upreme Petrochem Ltd (SPL) is

Indias leading styrenics producer,

with more than 50 percent of the

domestic market, as well as a

strong international presence through

exports to over 85 countries. Moreover,

the companys emphasis on operating

under the principles of SD, has earned it

both a valued reputation amongst the local

community, and recognition at a regional

and national level.

Over the last decade SPL has grown

to become one of Shells largest SM

customers in the Asia-Pacific/Middle

East region, accounting for over

100,000 tonnes per year, which is

shipped to India from Singapore.

SHARED VISION

The relationship has developed as a result

of both strategic fit and a shared vision of

corporate citizenship. SPL has become a

significant player in styrenics in the region

and its scale and development strategy is

well aligned with our growth objectives in

key developing markets, says Wee

Chiong Lim, Shell Chemicals SM Business

Manager for Asia-Pacific/Middle East.

Its also important for us when

developing strategic relationships in

emerging markets that the customer has

a sustainable business model. SPL has

demonstrated that it shares our thinking

and philosophy about doing business in

Sustainable strategiesIdentifying customers that share Shells commitment

to the principles of sustainable development (SD) is

one of the challenges of expanding into developing

markets. In India, however, the styrene monomer

(SM) business has forged a strong relationship with

a major styrenics producer that has put SD at the

top of its corporate agenda.

Sa sustainable manner, and being

committed to high standards of HSSE

(health, safety, security and environment).

SPLs styrenics manufacturing facility,

located at a 340-acre complex 120 km

from Mumbai, produces a range of

crystal, high impact and specialty

polystyrene grades.

In addition, a compounding facility

enables it to process a wide range of

styrene-based products as well as other

types of polymers.

In ten years the plants capacity has

grown from 60,000 to over 272,000

tonnes of polystyrene per year. Improving

the lives of people in the local

community has been key to that growth.

Since starting operations there in1995 SPL has not only brought direct

and indirect employment to the area but

also established and funded a number

of community development programmes

and environmental initiatives.

Its presence and support has spawned

a range of entrepreneurial businesses,

co-operatives and mini-industries that

have transformed the local economy.

N. Gopal, SPLs Executive Director

(Styrenics) says: When we came to

Amdoshi we set out to become a partner

with the community and to demonstrate

that it would benefit from our presence.

He says SD initiatives have been key

1716

Executive Director - Styrenics, N. Gopal (left), gives Wee Chiong Lim, SM Business Manager for APME (second

right), and Ern-Teng Phua, SM Sales Manager for Southeast Asia/India (third left) a tour of SPLs facility.

business. We sponsored local students to

attend technical university, who then come

back to work for us. They have not only

become key members of our team but also

act as ambassadors to the local villages,

explains Gopal.A large portion of the land acquired

for the SPL site was allocated to the

development of a commercial plantation,

providing a green belt between the plant

and the local villages. The plantation

is used to grow crops, trees and medicinal

plants, and provides an opportunity for

local people to acquire horticultural skills

and develop small spin-off businesses.

We provided the agricultural training

and management support to enable local

people to develop a small agricultural

industry, says Gopal. The plantation

workers now also offer their experience

and services to other organisations.

We set out to become a

partner with the local community

and to demonstrate it would

benefit from our presence here



10/15

ore than 50 percent of global

solvents production is

consumed by the paint and

coatings industry. It is one

of the most innovative chemicals industry

sectors, reacting quickly to changing

market dynamics and adopting new

technologies to deliver improved coatings

performance or properties.

The increasing pressure of regulatory

trends, competition and the need for

innovation, however, is having an impact

on product development and the types

of solvent being used.

The selection of solvents is becoming

a critical factor for formulators as theysearch to develop products that comply

with legislation, reduce formulation costs

and improve coating performance,

explains Ekkehard Kuestermann,

Solvents Technical Manager for Europe.

A number of new paint technologies are

emerging in response to this - including

waterborne, high solids, radiation curable

and powder coatings but they all pose

formulation challenges, he says.

In nearly all cases paint producers still

rely heavily on a solvent as a key part of

the formulation. Selecting the right type

and grade of solvent for each application

is becoming a significant factor.

A formulafor flexibilityThe paint and coatings industry is the largest sector of the solvents market and alsoone of the most dynamic responding to regulatory trends, competitive pressures

and technical innovations. The breadth and flexibility of the industrial solvents

portfolio, however, continues to offer solutions to many formulation challenges.

M

S O L V E N T S

1918

S T Y R E N E M O N O M E R

For more information on styrene visit:

shell.com/chemicals/styrene

CONSERVATION PROJECTS

Through the work of the plantations

nursery, SPL has also donated more

than 10,000 saplings to forestry and

conservation projects across the region.

Other projects have helped to develop

facilities in the villages themselves,

including the provision of a clean water

supply, constructing school buildings and

contributing resources for the local library.

The company continues to provide training

and scholarships for local students,

sponsorship for cultural and sports

activities and funding for health check-ups

and awareness schemes for villagers.

Expansions of the plant, meanwhile,

have been achieved without increases inpollution, through improved energy and

water conservation measures. Many

of our units are demonstrating industry

global best practices for pollution

control, waste management and

energy optimisation, says Gopal.

SPL is a signatory to the Responsible

Care2 initiative in India and its

environmental and quality credentials

include ISO 9001, ISO 14001, OHSAS

18001, as well as a Five Star rating for

Health & Safety Management from the

British Safety Council.

Gopal says that the companys approach

to SD has been a good investment. As a

result of these programmes we have the

full support of the community, as well as

local authorities, and are considered

to be an honest, ethical company.

Alliances with leading international

companies have been key to developing

products capable of meeting the

requirements of global markets. SPLs

products conform to US and EU food

contact requirements and meet

international standards for electrical

and electronic appliances.

The developing relationship with Shell

Chemicals is also fundamental to its

growth strategy, which aims to take

advantage of opportunities in emerging

specialty styrenics applications.

GROWTH OPPORTUNITIES

While growth in traditional, low-end

styrenics sectors, such as CD and music

cassette cases, has levelled off in India,

there are significant opportunities in

more sophisticated end-uses and exports.

With GDP of around 9 percent, India

is one of the fastest growing economies

in the world. This is fuelling demand from

key sectors such as automotive, electronics

and consumer goods industries for more

advanced polymer systems.

In response, SPL has been looking to

diversify its portfolio of styrene-based

products, with a focus on speciality PS

grades and tailor-made compounds. A

45,000 tonnes per year EPS (expandable

polystyrene) plant is under construction

and due to be completed by mid 2009.

It also recently acquired an EPS facility

in Chennai, which will be operational by

the end of Q1 2008 with an enhanced

capacity of 20,000 tonnes per year.

The company has plans to move into

ABS (acrylonitrile butadiene styrene).

These moves are part of our thrust

towards catering to the specialised

requirements of developing industry

sectors in India, and for expanding

our market horizons, says Gopal.

To support these ambitions Shell and

SPL are looking at options to further

integrate their strategic relationship thatwill secure long-term supplies of SM.

Its a relationship we want to develop,

not just because we see the opportunity

to support SPLs growth plans, but also

because the two companies understand

each other and share a philosophy, says

Wee Chiong Lim. Thats important when

youre in business for the long term.

SPL representatives visit the styrene plant in Singapore which supplies their facility near Mumbai, India.



11/15

S O L V E N T S

For more information on the ShellChemicals range of solvents visit:

shell.com/chemicals/solvents

formulations because they produce a

coating thickness that could require at

least two applications of other paints.

Typically high solids coatings have a

lower overall solvent content, which has

an impact on their viscosity, pot life and

curing temperatures, says Wiersma. To

allow the use of lower volumes of solvent,

formulators have to use a solvent with

higher solvency power, such as ketones

and aromatic solvents, to achieve the same

viscosity and performance properties.

Other formulations have been impacted

by health and environmental concerns

of certain solvent products. For example,

stricter product classification and

occupational exposure limits have

restricted the use of low boiling point

white spirits and aromatic solvents.

This has led to greater use of de-aromatised aliphatic mineral spirits and

glycol ethers in industrial and protective

paint formulations, where occupational

exposure is an issue, says Wiersma.

SHIFTING PRODUCTION

In recent years Shells solvents business

has responded to changes in the market

by shifting the emphasis of production to

more non-aromatic solvents, and increased

production of chemical solvent grades.

Cutting edge innovation, such as the

emergence of nanotechnology is likely

to have an increasing influence on solvent

selection in the paint and coatings sector.

Shell chemicals companies produce and

market one of the largest and broadest

portfolios of oxygenated chemical

solvents, hydrocarbon solvents, glycols

and glycol ethers.Having a broad

product range is essential in helping

customers to alter formulations, or

develop new ones, in response to

market demands, says Kuestermann.

The breadth of solvent grades available

and their wide variety of properties

provides a lot of flexibility for formulators.

There are many opportunities to move

from one solvent to another in order

to meet new performance criteria.

To further assist customers, Solvents

Technology experts from Shell Global

Solutions have developed a computer-

aided tool to make reformulation easierand more systematic.

The BlendPro 5.0 software (see box)

can be used to develop solvent systems

according to performance criteria or

to meet environmental limits relating

to Hazardous Air Pollutants (HAPs) and

Volatile Organic Compounds (VOCs).

Emissions of VOCs and other health

and environmental concerns have led to

a range of legislation in Europe and the

US that has impacted the types of solvents

used in certain paint applications.

In Europe, the Solvents Emissions

Directive (SED) and Decorative Paints

Directive have imposed strict limits for

VOC emissions that may be created either

as part of the paint manufacturing process

and/or when the paint product is used.

ALTERNATIVE FORMULATIONS

In some cases this has led to use of

alternatives to VOC-emitting solventsystems and different types of paint

formulations. The SED does, however,

allow industrial users of conventional

solvent-based coating systems to reduce

emissions by abatement techniques.

Water-borne paints, developed in

response to VOC regulations, are

expected to take an increasing share

of the market in some regions. In Europe

and North America they are almost

exclusively used in DIY decorative

paints, where VOC emissions cannot

be controlled during application.

Even water-borne paints actually contain

up to 15% of mostly water-soluble solvents,

including chemical solvents and glycol

ethers, in order to maintain a coatings

durability and appearance. The increasing

use of water-borne technology was one of

the major factors behind Shells decision

to invest in a world-scale glycol ethers

plant at Pernis in The Netherlands.

Adding a range of propylene-based

glycol ethers to our portfolio has enabled

us to respond to the growing requirements

for these solvents from customers that are

developing products based on water-borne

technology, says Kuestermann.

In Asia-Pacific, the use of solvent-borne

decorative paints continues to grow,

although other technologies are expected

to transfer to the region in the longer term.

In industrial paint applications, such as

the automotive industry, where VOCs canbe captured during paint application,

Nanotechnology can help to improve

traditional coating performance criteria

but can also enable the development

of smarter formulations and special

properties, says Wiersma.

CAREFUL SELECTION

These innovations will continue to

require careful formulation and selection

of appropriate solvents in order to

deliver products that can be produced

economically, applied easily and

perform to the same standard.

Despite the pressure of regulation,

costs and innovation, overall solvents

consumption in the global paint and

coatings industry is still growing strongly.

Demand growth is moderate but stable

in Western Europe and North America

but is rising steadily in Eastern Europeand in Asia-Pacific, which now accounts

for over 30% of global paint production.

The growth in the market reflects the

fact that the performance of solvents is

still hard to effectively replicate in many

paint applications, explains Kuestermann.

Faced with having to respond to different

market drivers, formulators will continue

to rely on the flexibility of solvents.

there are different approaches to solvent

selection. While some car manufacturers

have moved towards water-borne coatings,

others continue to exploit the overall

performance benefits of solvent-borne

coatings, particularly in more efficient

paint application techniques.

Car makers are looking to reduce costs

by moving to thinner, fewer, layers of

paint with reduced curing or drying times

in between, explains Rene Wiersma, a

Solvents Application Researcher with Shell

Global Solutions. This reduces the energy

and time required in the painting process

and conventional solvents, due to their

high solvency and evaporation rates,

are very effective in this process.

In other sectors, such as coatings for

metal protection on bridges and pipelines,there has been a trend to high solids

20 21

Solvents Application Researchers Illse Dullens and

Rene Wiersma use BlendPro to provide technical

support for paint and coatings formulations.

The breadth

of solvent grades

available and

their wide variety

of properties

provides a lot

of flexibility for

formulators

TAKING THE GUESSWORKOUT OF REFORMULATION

Shells BlendPro 5.0 solvent software

tool helps customers to optimise

solvent systems and blends, and

makes the process of reformulation

quick and efficient.

It automatically calculates solvent

blend properties (flash point,

evaporation, solvency power, resin

solubility; exposure etc.), allowing

systematic evaluations of

formulations in a desktop study

rather than through expensive,

time-consuming laboratory trials.

The software, which operates in

a conventional PC Windows

environment, incorporates

performance and HSSE data on

each solvent type and grade,

enabling paint producers to

generate new or alternative

formulations to specific criteria.

It includes models for specific

applications such as sprayed and

indoor brushed products, and can

be applied to both solvent- and

water-borne systems.

The flexibility of solvents is key

to the development of paints and

coatings able to meet performanceand environmental criteria.

For more information visit:

shell.com/chemicals/solvents/blendpro



12/15

22 23

U R E T H A N E C H E M I C A L S

it has implemented to manage TDI emissions.

Shells commitment to sharing its

knowledge and experience with us has

been key to making this happen, he says.

Koury believes it is the role of industry

leaders to set high standards. Legislation is

not our motivation but it will come one day

and so measures put in place now will help

prepare us for a more regulated market. Ifwe lead, the industry will start to follow.

RAISING STANDARDS

Nevertheless, the challenge of raising

standards across developing markets is still

significant. The lack of a comprehensive

regulatory structure combined with rapid

economic development in some regions

has meant attention to HSSE issues has

sometimes been low key.

Shell standards are often still way

ahead of local regulations where they

exist. Bad practices also tend to be more

extreme, including personal protective

equipment (PPE) not being worn in foaming

areas leaving workers directly exposed

to TDI emissions and inappropriate use

of empty contaminated TDI drums.

Many problems arise because of low

awareness of the hazards of working with

TDI amongst smaller companies, explains

Aditi Sawhney, Sales Manager for Indiaand the Philippines. But customers aspire

to global HSSE standards even if they are

he Walk the Talkprogramme,

based on guidelines developed bythe European polyurethanes

industry body ISOPA, has already

proved effective at raising awareness of

the hazardous nature of isocyanates

among Shell polyols customers in Europe.

Although not produced by Shell,

isocyanates such as TDI are used to react

with polyols in slabstock foam production.

Direct exposure to TDI emissions may

cause irritation to the eyes, skin and

respiratory system. Prolonged over-

exposure can have more serious medical

consequences. Handling TDI in line with

recommended practices, however, should

not pose a hazard to health or environment.

Through the Walk the Talkinitiative

ISOPA members have taken information

and guidelines for the safe handling of

isocyanates to hundreds of users across

27 European countries, explains Mike

Jeffs, ISOPA Secretary General. We

believe the benefits of this engagementwill come through, with fewer incidents

and higher safety standards.

He says ISOPA welcomes the fact that

its member companies are now taking

the initiative to a wider user base. This

information is relevant beyond the borders

of Europe and Shell is at the forefront of

expanding the scope of engagement.

Having established a high level of

understanding with customers in Europe,

attention has turned to developing markets.

Were using the experience and

learnings from the initial rollout to take

the programme to a global audience,

says Elder Teixeira, Urethane Chemicals

Global engagement

T

Sales Manager for Latin America.

Customers in Latin America are not

receiving this information from other

sources and so appreciate the fact Shell issharing this knowledge with them, in order

that they can fully understand the risks and

make sure their people are protected.

CBP of Brazil is one of Shells major

polyols customers in Latin America and

a leading foam producer. As a result of

Shells awareness campaign it has been

proactive in implementing measures to

raise standards for handling TDI.

Guilherme Koury, the companys owner

and Marketing Director, says its motive is

simple: Although we employ more than

400 people we are still essentially a familybusiness. We want to look after our people

and provide a safe environment for them

to work in because they are part of the

family and part of our success.

CBP has used the ISOPA guidelines and

other support materials provided by Shell

to train and inform its workforce, and has

invited both customers and other producers

to its facilities to demonstrate the measures

not there yet, and have responded positively

to our approach because they are not

getting this support from other suppliers.

As part of Shells global campaign the

ISOPA checklists and guidelines have been

translated into a number of additional

languages. Customers are usually

surprised but pleased to receive this

information from us when we do noteven supply the TDI, says Sawhney.

This has been backed up by site visits

by Sales and Technical Support staff to

go through checklists, provide assessments

and present training videos. These visits are

targeted at reaching the people actually

handling the chemical, as well as engaging

with the customers management team.

The challenge is often to convince the

operational people of the need for

mitigation measures. In many countries

the absence of PPE is often simply a result

of the fact that workers are operating in

temperatures of over 40C, she explains.

Praduman Patel, Joint Managing Director

of Sheela Foam and Joyce of Australia - a

subsidiary of Sheela Foam, Indias largest

foam producer - has used personal

experience as motivation for implementing

high safety standards at the companys

facility in New Delhi.

When I started in this business 30 yearsago I was operating machinery and

handling foam myself, so I know the

hazards of TDI if the correct procedures

and safety equipment are not in place.

Sheela Foam has invested in modern

foaming machinery equipped with the

latest extraction technology, while

recognised processes are in place for safeunloading of TDI, dealing with minor spills

and for effective drum decontamination.

ALWAYS THINGS TO LEARN

He says Shells engagement programme

has helped to fine-tune its standards and

processes. There are always things to

learn and ways to improve and the Shell

campaign has helped to raise awareness

and bring these issues to the surface.

As an industry leader its important for

us to take the initiative in health and safety

issues, not just for our own reputation but

for taking the industry in India forward.

While there is still a long way to go,

the global TDI programme has already

resulted in noticeable changes in attitude,

and greater recognition of the commercial

value of a reputation for strong health and

safety performance in developing markets.

Foam producers are increasingly

engaged in health and safety initiatives

because they not only want to protect their

workers but also because they understand

the importance of image in gaining the

trust of their growing number of potential

consumers, says Teixeira.

They see no reason not to have the

same standards as their counterparts in

Europe and North America and we are

helping them towards that goal.

Personal protective equipment being used during the unloading of TDI from a tanker.

Elder Teixeira, Urethane

Chemicals Sales Manager for

Latin America - customers in

developing markets see no

reason not to have the same

standards as their counterparts

in Europe and North America.

CBP in Brazil has established high standards for mitigating TDI emissions at its manufacturing facilities.


isopa.org/walkthetalk

Customers appreciate the fact that Shell is

sharing this knowledge with them so they can

make sure their people are properly protected

A European programme promoting the safe and responsible handling of isocyanates

used in polyurethane foam manufacturing processes has been rolled out to Shell

customers globally. Based on industry best practices, it is helping to raise

awareness and standards of product stewardship in key developing markets.



13/15

Driving home the safety message

2524

L O G I S T I C S

tructural changes and competitive

pressures in the chemicals industry

mean that major producers have

to rely on outsourced logistics

providers to transport products by road

to their customers around the world.

The increasing reliance on contractors,

however, has raised challenges relating

to levels of safety performance during

delivery and unloading procedures.An increase in safety-related incidents

and near-misses during deliveries first

highlighted the issue in early 2005.

A rising number of incidents involving

contracted hauliers was leading to injuries

or spills, despite the fact that our internal

safety performance was making significant

progress, says Michael Crothers, Shell

Chemicals outgoing General Manager

Global Supply and Logistics.

Over the last two years

there has been a major

focus on improving the

safety performance of

contractors that transport

our products around the

world. Engagement and

awareness programmes,

incentive schemes and

compliance checks are

all part of initiatives to

build a stronger safety

culture among hauliers.

S

such as tanker rollovers (see next page).

He says HSSE considerations have

become an even stronger driver of the

haulier selection process. We are looking

to work with hauliers whose management

clearly appreciates the importance weplace on safety. Where companies have

demonstrated this through investment in

equipment and training, we try to

recognise this through higher volumes

or longer-term contracts with them.

Many hauliers are willing to adopt the

standards we are promoting, although

we understand that for some it represents

a significant challenge.

Its a complex change management

process which requires sustained energy

and commitment. Not all hauliers have the

capabilities to effectively drive this change

journey so we have stepped up our

resources and capabilities to help them.

The carrier industry is under a lot of

pressure at the moment but our hauliers

have responded well to our approaches.They respect what we can bring to their

business and can see the long-term benefit

of adopting these global standards.

However, we have also terminated

contracts with several hauliers because

of inadequate attention to HSSE issues,

Drivers of contracted hauliers have been targeted directly in the safety engagement campaign, with literature translated into several languages.

and rationalised our haulier base in order

to build better partnerships based on

strong HSSE cultures and capabilities.

While road and traffic conditions may

vary in different parts of the world, the root

cause of most safety-related incidents ornear-misses almost always comes down to

attitudes and behaviour. To address this

a hearts and minds campaign has been

targeted directly at drivers.

We want to reach out to our contracted

drivers because they are ultimately the

ones delivering the safety performance

while dealing with the typical pressures

to get the job done. Changing the way

they think and act will help to eliminate

unnecessary incidents, says Eggels.

Part of that is making them more aware

of the hazards but, just as importantly, its

about making it explicitly clear to them

that its OK to stop and report unsafe

Responsibility for our products does

not end when a truck leaves a Shell facility.

We need contracted hauliers to place

the same high priority on safety and

environmental protection as we do.

This issue is key to our reputation as

a responsible supplier, and is an integral

part of our business performance.

As a result, since the end of 2005 a

major effort has been underway to raiseawareness of, and improve compliance

with, Shell safety standards among these

contractors. We have set out clear

performance expectations, accountability

that includes rewards and consequences,

and improvements plans through

engagement with both their management

teams and drivers, says Crothers.

MAJOR LOGISTICAL TASK

Around 125,000 consignments over two

million tonnes of chemical products are

delivered to Shell customers globally each

year by road. Its a major logistical task,

entrusted to some 40 or so primary

haulage companies contracted to make

these essential deliveries across the world.

The engagement on safety issues with

these logistics service providers has been

stepped up significantly. We have put in

place a number of initiatives to help build

a stronger safety culture among ourcontractors, says Jack Eggels, Global

Land Logistics Manager.

It started with more focused and frequent

discussions on safety issues with the haulier

management teams, intensified compliance

spot checks as well as incentive schemes.

There has also been a lot more energy and

focus on safety issues during performance

reviews and contract negotiations.

This year we added direct engagement

with contracted drivers, while specific

campaigns have focused on key issues

Jack Eggels, Global Land Logistics Manager -

looking to work with hauliers that appreciate

the importance Shell places on safety.

As part of the elimination of potential hazards

the taking of samples at customer premises by

contracted drivers is being phased out.

Drivers have to feel able to stop and refuse to continue

with a delivery until an unsafe situation is remedied



14/15

26

L O G I S T I C S

situations. They have to feel able to refuse

to continue with a delivery until

an unsafe situation is remedied.

As part of the identification and

elimination of hazards there have been

revisions to procedures in some regions.

In Europe, for example, sampling from the

top of road tankers or tank containers at

customer premises by drivers is being

phased out by the end of 2007.

This new policy, which is in line with

CEFIC guidelines, is designed to ensure

all supply chain activities are carried out

by qualified personnel. Customer staff are

generally well trained in dealing with our

products and better equipped to take and

handle product samples using adequate

safety precautions, explains Eggels.

He says that while Shell has not seenany incidents as a result of drivers taking

samples, there have been cases across

the industry, mostly due to drivers having

to climb on top of tankers or having to

use inadequate sampling equipment.

PROACTIVE MEASURES

We are taking proactive measures to

avoid potential incidents. If a sample is

necessary, we recommend customers use

an alternative method. A similar policy

is in place in the US/Canada and work is

progressing to roll it out globally.

Drivers are being engaged at all possible

opportunities, including Shell loading

Truck rollovers are typical of the

incidents encountered across the

chemical logistics industry.

Its almost always human error

rather than mechanical failure

that leads to these events,

says Jack Eggels, Global Land

Logistics Manager for Shell

Chemicals.

Speed is often one of the main

causes. Not necessarily excessive

speed, but speed inappropriate

for the conditions. Hit a curb

when travelling too fast, swerve

or brake suddenly and the

resultant sloshing of the product

in the tank can be enough to

tip the truck over.

In the comfortable, air

conditioned, computer-laden

cabs found in many modern

trucks drivers can sometimes

forget about the sheer bulk of

the materials they are carrying

and just how susceptible their

trucks are to tipping over, if

not driven with great care.

As part of the logistics safety

campaign, an engagement pack

has been produced to explain

to drivers why these rollovers

happen and to detail avoidance

actions for different situations.

locations, during on-the-road compliance

spot checks as well as via workshop

sessions at their own company premises.

Posters and leaflets are being distributed

across the globe in different languages to

make sure the key messages get through.

Eggels, who chairs CEFICs logistics

sector group, says learnings from Shells

campaign are being fed back into

appropriate industry bodies. We need

to take an industry approach to this issue

if we are to see a cultural change. We

hope that our programme will serve as

a good platform for wider initiatives.

ENCOURAGING RESPONSE

He has been encouraged by the response

to the campaign so far. Positive feedback

indicates that the campaign is sendingthe right signals and generating further

discussions. Hauliers have complimented

us for taking a leading role and have

encouraged us to continue the journey.

Nigel Hobson, incoming General

Manager of Supply and Logistics, adds:

Weve seen signs of improvement over

the last two years and the message is

clearly getting through. Its an encouraging

trend that confirms we are on the right

track. However, the challenge is to

maintain that energy and focus to ensure

improvements are sustained and that

safety becomes as integral to our

hauliers business as it is to ours.

Capturing the hearts and minds

of drivers is key to the elimination

of unnecessary safety incidents.


shell.com/chemicals/safety

27

ADVICE FOR AVOIDINGTRUCK ROLLOVERS



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Magazine Autumn 07 Full

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