However, there were no signs yesterday that BT was about to react to Wanadoo’s sub-£20-a-month offer on the much faster and content-rich 1Mb service.BT is planning to use its high-speed broadband service to launch video on demand and other entertainment services later this year. Duncan Ingram, the managing director of BT Openworld, said: “It will be interesting to see whether Wanadoo’s is a permanent price or just an initial special offer.”BT’s broadband tariffs have been undercut by opposition including Tiscali, which launched a £15.99-a-month basic broadband offer at the slower speed of 512k. France Telecom waded into the high-speed internet price war against its arch rival BT Group yesterday when it announced a £17.99 1Mb service through Wanadoo, its internet service provider (ISP).
The aggressive move brought an immediate response from BT, whose 1Mb service costs £29.99 a month. The SEC and the FSA acknowledged Shell’s co-operation with their investigations, without which the fines would have been higher.Separately, Shell’s chairman, Jeroen van der Veer, said the company would provide an update next month on any proposed changes to its much criticised Anglo-Dutch dual board structure. “We do not deny that one of the alternatives is to unify the boards, but we have to say what does that mean?” he said.Outlook, page 35. Shell either rejected the warnings as immaterial or unduly pessimistic, or attempted to ‘manage’ the potential exposure.”The US Department of Justice is conducting a criminal inquiry into the affair and a series of shareholder lawsuits have been filed against Shell.In agreeing to pay the fines, the company did not admit nor deny the regulators’ findings.

The FSA said the company had been alerted to the problem through repeated warnings, from internal and external sources, between 2000 and 2003but chose not to act on them.Shell has now admitted that it overbooked 4.47 billion barrels of oil – 25 per cent of its proven reserves.The SEC said: “These failures led Shell to record and maintain proved reserves it knew, or was reckless in not knowing, did not satisfy SEC requirements, and to report for certain years a stronger RRR [reserves] than it actually had achieved…. Sir Philip’s compensation was not subject to any such conditions.A Shell spokesman said the difference in the size of the two pay-offs reflected the fact that Mr van de Vijver would have had many years of his career left at Shell, whereas 59-year-old Sir Philip was due to retire next year.Andrew Procter, the director of enforcement at the FSA, said: “The size of the penalty in this case reflects the seriousness of Shell’s misconduct and the impact it had on markets and shareholders.”The UK’s market regulator set out in detail a pattern of “false and misleading” information given by the company to the market between 1998 and 2003.Shell did not start to correct this until January this year. As with companies, the FSA has the power to impose unlimited fines on individuals.Sir Philip received a pay-off of £1m, it was announced in June. In April, the finance director, Judy Boynton, agreed to “step aside” although she continued to work as an adviser to the company for some weeks.Harold Degenhardt, the administrator of the SEC’s Fort Worth office, said: “As our investigation continues, we intend to focus on, among other things, the people responsible for Shell’s failures.”Similarly, the FSA said that although its inquiry into Shell’s misconduct was closed, “investigations into other aspects of this matter are ongoing”. Earlier this month, Shell said it had agreed to pay Mr van de Vijver £2.5m, in instalments “subject to continuing co-operation with and review by the relevant authorities”.

Sir Philip Watts, the former chairman, and Walter van de Vijver, who was head of exploration and production, were sacked in March. The FSA’s fine, for market abuse and breaching the listing rules, dwarfs its previous highest penalty – £4m against Credit Suisse First Boston in 2002.Three senior managers have left Shell in the wake of the reserves scandal, which emerged in January. Regulators in the UK and US will pursue the individuals responsible for the overstatement of reserves at Shell after the watchdogs yesterday agreed fines of £84m over the company’s “unprecedented misconduct”. This price rise is going to add millions to bills and expose many thousands of households to the risk of fuel poverty.”British Gas said that it was putting £10m into a fund for grants that is put aside to help any of their customers struggling to pay bills.. “There are no prizes for loyalty in the energy market,” said a spokesman for Ofgem, the government regulator, adding that customers could save up to £98 a year by switching.Allan Asher, chief executive of the consumer group Energywatch, added: “This is a body blow to consumers.

“We would expect the industry as a whole to seek higher prices in the coming month,” a spokesman said.British Gas’s increases appear to be higher than those of its rivals. PowerGen prices rise 3.1 per cent, or £10 a year, next month. Customers in the Scottish-Hydro, Southern and Swalec regions owned by Scottish Power can expect gas bills to increase by an average 4.6 per cent, or £15 a year.EDF Energy, which owns London Energy, Seeboard, Sweb and VirginHome, has said its five million customers would see an average 3.8 per cent rise for electricity and 3.5 per cent for gas.Consumer groups urged British Gas customers to switch suppliers. “We have absorbed as much of these additional costs as we could, but unfortunately we now have to pass a proportion of them on to our customers.”He blamed the depletion of reserves in the North and Irish seas, which had forced the UK to import larger volumes of gas. The rises will hit the company’s 18.4 million domestic customers – 12.2 million with gas and 6.2 million with electricity.The increases are the latest impact of rising energy costs on households following successive leaps in petrol prices during the past few months.Mark Clare, the managing director of British Gas, said wholesale gas prices had hit record levels, with the forward prices gas next year up by 50 per cent on 2003. “The era of cheap energy is over but we have confidence that the investments we are making in future energy supplies will, in the long term, put downward pressure on commodity costs,” Mr Clare said.There have already been sharp rises in gas prices this year.