Former Shell director gets €3.8m pay-off

A senior Shell director who resigned in the wake of the reserves crisis earlier this year is to receive a €3.8m pay-off, it emerged today.

Walter van de Vijver, the company’s former exploration and production boss, will pick up the severance payment in stages and on condition he co-operates with ongoing reviews into the crisis.

He resigned along with chairman Philip Watts after the Anglo-Dutch group shocked investors in January by revealing proven oil and gas reserves were 20% lower than first thought. It downgraded its reserves a further three times.

The problems sparked a major review into the structure of the business, which the Financial Times said today could go as far as leading to Shell’s Dutch and British holding companies being merged.

Shell was said to have hired bankers to assess the possibility of a merger – a far more radical move than the unification of the two boards which many analysts had been expecting.

The company said in a statement that it was considering a “broad range of structures” and had not ruled anything in.

It later revealed details of the payment to Mr van de Vijver, who was 12 years short of retirement after 25 years with the company.

He will not receive a performance-related annual bonus or stock options in respect of 2004 but is entitled to a deferred pension of €385,388 per year, it added.

Both men left the company in March and were severely censured a month later in an independent review commissioned by Shell.

The company has already pledged to consider changes to its structure, which is currently made up of Royal Dutch, which controls 60%, and Shell Transport and Trading, the UK side controlling the remaining 40%.

These two companies have separate stock exchange listings in Amsterdam and London.