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Shell flies in staff to Spokane

Sat., Oct. 27, 2007

Global energy giant Shell collected a quick dividend from its July purchase of Avista’s power and gas trading subsidiary.

With one-fourth of its San Diego work force evacuated from their homes because of wildfires, Shell Energy North America piloted employees north to Spokane, rented them hotel rooms, and put its newest office location overlooking crimson-leafed Riverfront Park to the test.

The result: Shell is pleased that the $175 million it paid for what was once called Avista Energy offered immediate value.

“Everything worked out better than we could have hoped,” said Brian Johansen, Shell’s general manager overseeing the Spokane office. “This showed our ability for business continuity during a pretty challenging time.”

Shell’s San Diego office was five miles from the wildfire evacuation zone. Thick smoke, fears of power outages and telephone and Internet disruptions led company managers to blow the dust off of business contingency plans.

Beth Bowman, Shell’s western district senior vice president, said the San Diego employees have since returned home, impressed with Spokane’s hospitality and fall weather.

Shell has kept about 42 of the approximately 50 local employees of Avista Energy, the local utility’s foray into electricity and natural gas trading.

Trading electricity is a high-pressure business where millions of dollars in trades are executed every day. For example, Avista Energy cleared $6.6 billion in trades during 2000.

Bowman said Shell always had its positions covered during nerve-wracking days when the fire was pushed into an inferno that burned 1,500 homes and evacuated more than 500,000 people.

In some ways, it was the Spokane office that was able to step up and make sure the company never missed.

“We’re just really proud of that office,” Bowman said.

On the sixth floor of the Red Lion headquarters building, employees analyze electricity and natural gas markets, and execute short- and long-term trades. The business provided Avista some terrific returns during its 10-year history, but also a level of risk the company ultimately decided was too great.


 

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