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Lego ends Shell contract after Arctic campaign by Greenpeace

The Greenpeace campaign video went viral and may have forced the hand of Lego, but they say they do not agree with the tactics used. Credit: Greenpeace

By Joel Hills: Business Editor

The video is awesome. Inventive and superbly executed there's no question that it resonates.

Greenpeace's warning of catastrophe if Shell pursues its Arctic ambitions has been watched six million times online.

Lego initially resisted pressure to end its commercial tie-up with Shell, it has now changed its mind.

"We do not agree with the tactics used by Greenpeace", Lego's statement says. This was a commercial decision not a ethical one.

Companies have been producing oil and gas in the Arctic for almost 60 years. Today the region accounts for 10% of the world's oil production and 25% of its gas production.

Shell has been there since the begining. In 1963 it drilled Alaska's first offshore oilfield at Cook inlet - the field still produces oil and gas today.

In the 1980s and 90s the market price of oil fell to as little as $20 a barrel. Shell lost interest in Alaska but as the oil prices rose again so interest was renewed.

Shell returned to Alaska in 2005 with a plan to head north out into the icy Beaufiort and Chukchi seas.

The company's ambitions ran aground along with one of its drilling rigs on New Years Eve 2012. Shell announced a "pause" in Arctic

A review by the US government later concluded the company was unprepared for the extreme conditions.

Shell has spent $5 billion exploring the Beaufort and Chukchi regions and has applied for the right to resume drilling again next year.

Shell has drilled 33 wells in the Arctic in last 40 years, all but one of them offshore. It says it's never had a well head spill and claims "a proven record of safe and responsible operations."

Never the less there have been accidents in the Arctic. In 2006 BP found leaks in one of its pipelines in Prudhoe Bay as suspended production.

The Arctic eco-system is cold, remote and fragile, on this everyone is agreed.

Oil and gas extraction is inherantly risky, the problem is the world needs hydrocarbons. The question then (until we can depend on alternative sources of energy) is whether Shell and other companies can go about their business while keeping risks to a level that is both minimal and acceptable to society.

At least one climate change scientist has been critical of the Green peace video.

Professor Chris Rapley of University College London says it's "too easy to demonise oil companies". He felt the video was "too simplistic" and "hypocritical because we wouldn't be able to live the lives we take for granted without the supply of energy these companies provide to us".

Greenpeace points out (correctly) that Professor Rapley has worked with (although not for) Shell on a couple of occasions in the past.

They also point out this was a campaign video. It was designed with one goal in mind and in that sense it has been a success.