Royal Dutch Shell plc (ADR) (RDS.A), Exxon Mobil Corporation (XOM): What Keeps Energy Executives Up at Night?

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Perhaps the most overwhelming example is the giant offshore Kashagan oil field, located in Kazakhstan’s zone of the Caspian Sea. Even after the project’s stakeholders — a consortium of global energy companies including Exxon Mobil Corporation (NYSE:XOM), Royal Dutch Shell plc (ADR) (NYSE:RDS.A), and Eni SpA (ADR) (NYSE:E) — have plowed more than $30 billion into the project over the past 10 years, Kashagan has failed to produce a single drop of oil.

Final thoughts
Despite their best efforts to minimize accidents, the world’s largest oil and gas companies operate in an environment fraught with risk. As they push further into new, remote regions around the globe, often conducting business with unstable foreign regimes, these risks often multiply.

Like the big four banks that have been deemed “too complex to manage,” the large Western oil majors may similarly have become too complex and diverse to ever be able to completely eliminate accidents. Exxon Mobil Corporation (NYSE:XOM) is perhaps the best example.

Despite its overarching focus on operational safety, an objective it has pursued — quite successfully — in the aftermath of the infamous 1989 Exxon Valdez oil spill, the company still hasn’t been able to attain its goal of zero accidents, as shown by the recent rupturing of its Pegasus crude oil pipeline.

The bottom line is that no matter how good energy companies’ workers, equipment, and executives are, some mistakes will continue to occur from time to time. This is simply the harsh reality of the nature, scope, and scale of their operations.

The article What Keeps Energy Executives Up at Night? originally appeared on is written by Arjun Sreekumar.

Fool contributor Arjun Sreekumar owns shares of Chesapeake Energy. The Motley Fool recommends Chevron and Petrobras and has options on Chesapeake Energy.

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