November 01, 2001
Reducing Greenhouse Gases by Making Fizz
by Mark Thomsen
An innovative venture enables a Shell subsidiary to sell excess carbon dioxide for soft drink
manufacturing, but social investors should know that the company is still miles away from being
As the old saying goes, one man's trash is another man's treasure. Shell Chemicals Canada is
proving the proverb can apply to industrial processes and materials as well. Earlier this year,
the company's Scotford plant in Alberta, Canada began supplying waste carbon dioxide, or
CO2, to a neighboring facility of the French company Air Liquide. Air Liquide is
processing the gas and supplying it to companies that use it in making carbonated beverages.
The Scotford plant previously disposed of waste CO2 by simply venting it
into the atmosphere. In the new venture, the plant eventually will provide 62,000 tons of
CO2 per year to Air Liquide.
The emission of CO2 into the
atmosphere is a problem because many scientists believe such emissions contribute to a "greenhouse
effect," or a warming of the Earth's surface. Global warming potentially could have such
disastrous effects as raising the level of the oceans and causing more violent and extreme weather
The arrangement with Air Liquide is notable because it also involves Shell's
purchase of steam and electricity from Air Liquide's own cogeneration plant.
safety, environment, and quality manager at Shell's Scotford plant, Karl Blonski, was effervescent
about the arrangement. "It's real synergy - Air Liquide will eventually buy much of our
CO2 and we are able to buy cheap, efficiently produced electricity from them, which
we previously bought from the Alberta Grid."
The carbonization of soft drinks is one of
the largest single markets for CO2, and this fact help bring Shell Chemicals and Air
Liquide together. But this type of arrangement is not a first for Shell Chemicals. In the
Netherlands, one of its plants in Moerdijk supplies 40,000 tons of CO2 a year to the
Swiss company Omya for the production of calcium carbonate, which is used in the whitening of
Royal Dutch Shell Group's actual CO2 emissions are about 100 million
tons worldwide, which is down from 122 million tons in 1990. But while Shell Chemicals' parent
company says it is committed to CO2 reductions and the promotion of renewable
energy, its budgetary commitment tells a different story.
According to CorpWatch, a
nonprofit that monitors corporate social and environmental practices, the parent company's 1997
allocation of $500 million to develop renewable energy over the next five years may seem
substantial, but actually amounts to less than one percent of the company's overall budget for the
Shell Chemicals' handling of a long-standing dispute with communities near
its Norco, Louisiana facility is also less than socially responsible. For 15 years, the residents
of Norco's Diamond district have been asking Shell to relocate their neighborhood because it is
immediately adjacent to a Shell Chemicals facility and oil refinery.
CorpWatch, the community has proven that "hazardous chemicals are almost constantly in the air."
CorpWatch says that the pollution has driven people away, and that Shell has been patiently taking
advantage of falling property values by purchasing nearby properties at bargain prices.
Royal Dutch Shell's dealings with the people of Norco, Louisiana and the its real contribution
to global CO2 production were partly behind CorpWatch's decision to give the company
a "Greenwash Award" last year. According to CorpWatch, the award was in recognition of the
company's deceptive advertising in its "Profits or Principles" campaign.
Chemicals-Air Liquide arrangement is a win-win-win venture; a win for the two companies and a win
for the environment. But social investors should be wary of applying the value of one initiative
to the whole of a company's operations. Another old saying comes to mind when considering
corporate tales of good deeds: let the buyer beware.