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Shell to shut its main UK research base and transfer its work overseas

Hundreds of scientists to be relocated as oil multinational aims to shift most research and development work to Germany by 2014

Shell is to shut its main UK research and development base and transfer the work overseas in a bitter blow to Britain’s knowledge economy.

Hundreds of senior scientists working at the centre at Thornton in Cheshire will be scattered to other offices in a move which follows the sale of the nearby Stanlow refinery and is seen by some as a more general retreat by Shell from the UK.

Shell Technology Centre Thornton has been the base for developing biofuels and more traditional fuels for customers, including the Ferrari Formula One racing team.

Only 18 months ago the R&D base launched two new FuelSave products using the former England cricketer Andrew Flintoff to lead the marketing effort.

But the location, home to almost 300 scientists, is to be shut completely in 2014 with Shell concentrating its R&D efforts in Germany and other overseas centres.

A spokesman for Shell, which made £11.4bn in its last full financial year, said some of the positions would “migrate” to London at Shell’s UK headquarters. Other staff could work out of offices in Manchester, he added.

“This relocation of employees within the UK follows the decision … to move the site’s laboratory activities – largely to Hamburg but also to other sites globally – as part of a global review of our technology footprint,” he said.

Shell staff members told the Guardian privately that they were “seething” that the oil giant had been gradually cutting staffing at Thornton after closing R&D bases in the past at Sittingbourne in Kent and Egham in Surrey.

They said it reflected a general reduction in the importance of UK operations at the Anglo-Dutch group since the exit of the last British chief executive, Phil Watts, in 2004 after a row with the US Securities and Exchange Commission over the way the company had been booking its oil reserves in its accounts.

Shell, now led by a Swiss man, Peter Voser, announced the sale of Stanlow – its last remaining refinery in Britain and the country’s second largest – to Essar Energy of India in 2010.

And last week Shell, which is looking at ways to reduce its costs, said it planned to close its pension scheme to new entrants next year in order to “reflect market trends in the UK”. Existing members of the fund will be unaffected.

After last spring’s budget, Shell said it might sell some of its North Sea fields because of tax changes but its nearest rival, BP, has also faced accusations it is investing less and less in its home market.

Shell, which is expected to unveil fourth quarter profits of around bn (£3.25bn) on 2 February, said it hoped the Thornton site could still continue to pioneer R&D.

A spokesman explained: “We will work with interested parties to explore options for re-use of the site and facilities and we hope that science, technology and research can continue to be part of its future.”

Meanwhile, Shell’s hopes of drilling exploratory wells in Arctic waters received a boost last week with the affirmation that its federal air permits for the Chukchi Sea were properly granted.

The US Environmental Protection Agency’s appeals board rejected challenges to the granting of air permits brought by Alaska native and conservation groups.

The Shell Alaska spokesman Curtis Smith announced that the decision means Shell, for the first time, has usable air permits that will allow its drill ship, the Noble Discoverer, to work in the outer continental shelf off Alaska’s north-west coast this year.

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