Ben van Beurden, Chief Executive Officer of Royal Dutch Shell plc hosts a video webcast of the fourth quarter 2014 and full year results on Thursday January 29, 2015.
See http://www.shell.com/results for more information.
1. 1Copyright of Royal Dutch Shell plc 29 January, 2015
FOURTH QUARTER 2014 RESULTS
BALANCING GROWTH & RETURNS
29 JANUARY 2015
ROYAL DUTCH SHELL PLC
2. 2Copyright of Royal Dutch Shell plc 29 January, 2015
DEFINITIONS & CAUTIONARY NOTE
Reserves: Our use of the term “reserves” in this presentation means SEC proved oil and gas reserves.
Resources: Our use of the term “resources” in this presentation includes quantities of oil and gas not yet classified as SEC proved oil and gas reserves. Resources are consistent with the Society of
Petroleum Engineers 2P and 2C definitions.
Organic: Our use of the term Organic includes SEC proved oil and gas reserves excluding changes resulting from acquisitions, divestments and year-average pricing impact.
Resources plays: Our use of the term ‘resources plays’ refers to tight, shale and coal bed methane oil and gas acreage.
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate entities. In this document “Shell”, “Shell group” and “Royal Dutch Shell” are sometimes used for
convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to subsidiaries in general or to those
who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell
companies” as used in this document refer to companies over which Royal Dutch Shell plc either directly or indirectly has control. Companies over which Shell has joint control are generally referred
to as “joint ventures” and companies over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is used for convenience to
indicate the direct and/or indirect ownership interest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.
This presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical
fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and
assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements.
Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management’s expectations,
beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’,
‘‘expect’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’, ‘‘risks’’, ‘‘goals’’, ‘‘should’’ and similar terms and phrases. There are a number of
factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this
presentation, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results;
(e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and
targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and
regulatory developments including potential litigation and regulatory measures as a result of climate changes; (k) economic and financial market conditions in various countries and regions; (l)
political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the
reimbursement for shared costs; and (m) changes in trading conditions. All forward-looking statements contained in this presentation are expressly qualified in their entirety by the cautionary
statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional factors that may affect future results are contained in Royal
Dutch Shell’s 20-F for the year ended 31 December, 2013 (available at www.shell.com/investor and www.sec.gov ). These factors also should be considered by the reader. Each forward-looking
statement speaks only as of the date of this presentation, 29 January, 2015. Neither Royal Dutch Shell nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-
looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-
looking statements contained in this presentation. There can be no assurance that dividend payments will match or exceed those set out in this presentation in the future, or that they will be made at
all.
We use certain terms in this presentation, such as discovery potential, that the United States Securities and Exchange Commission (SEC) guidelines strictly prohibit us from including in filings with the
SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov. You can also obtain this form from the SEC by
calling 1-800-SEC-0330.
3. 3Copyright of Royal Dutch Shell plc 29 January, 2015
BEN VAN BEURDEN
CHIEF EXECUTIVE OFFICER
ROYAL DUTCH SHELL PLC
4. 4Copyright of Royal Dutch Shell plc 29 January, 2015
FOCUS ON HSSE
2014 UPDATE
Injuries – TRCF/million working hours
Goal Zero on safety
Injuries – TRCF/million working hours
Spills - operational
Volume in thousand tonnes
Energy intensity – refineries
Energy Intensity Index (EEITM)
Process safety
Number of incidents
million working hours
Working hours (RHS)TRCF
HSSE priority
Performance + transparency
Tier 1 incidents Tier 2 incidents
5. 5Copyright of Royal Dutch Shell plc 29 January, 2015
EXECUTING A CONSISTENT, LONG-TERM STRATEGY
Unrelenting focus on HSSE
Technology, integration and scale
Disciplined capital investment by strategic theme
Growth in cash flow through cycle
Competitive shareholder returns
Total shareholder returns growth – 10 years
Index 1/1/2005 =100
2014+ drive to rebalance growth and returns
Shell S&P500 FTSE100
6. 6Copyright of Royal Dutch Shell plc 29 January, 2015
2050 outlook
Population increases from 7 to 9 billion
Enabled by cheap and reliable energy
Realities
Requirement to mitigate climate change
Oil supply -70% by 2030 without new investment
Key role of gas & CCS
ENERGY TRANSITIONS
Long-term energy supply mix
Million boe per day
Gas
Biomass
Wind
Coal
Nuclear
Other renewables
Solar
Shell activities
Oil
Energy transitions underway
+50%
+50%
7. 7Copyright of Royal Dutch Shell plc 29 January, 2015
Oil market downturn
Entering 2015 with low oil prices
Requirement for $500 billion industry investment
in upstream oil during 2014-20
Under-spending amplifies price spike risks
Shell response
Long-term $70 - $90 - $110 Brent oil price
screens unchanged
Planning for low prices 2015+; uncertain
recovery timing
Hard choices on our growth pipeline + options
Opportunity to reduce costs
OIL MARKET + SHELL RESPONSE
Source: IEA estimates
Oil supply
Million barrels of oil per day
9. 9Copyright of Royal Dutch Shell plc 29 January, 2015
2014 DELIVERY
BALANCING GROWTH AND RETURNS
CCS earnings excluding identified items
CCS earnings $22.6 billion; CFFO $45.0 billion
Dividend growth + buyback
Restructuring in Oil Products + North America
resources plays
Moderated spending + growth
Improved free cash flow; reduced gearing
Early completion of 14-15 divestment plan
4 operated deep-water start-ups
Repsol LNG integration: >$1 billion CFFO impact
New options in FEED; improved exploration
Improve our financial performance
Enhance our capital efficiency
Deliver new projects
10. 10Copyright of Royal Dutch Shell plc 29 January, 2015
More rigorous portfolio management Taking hard choices on funnel
~140 performance units add focus
Increased shareholding requirements for
management
Bottom line focus
Credible, competitive + affordable plans
Resilience
Attractiveness
FEED
FID On-stream
Identify&Assess Select Define Execute Operate
ASPIRED
PORTFOLIO
ATTRACTIVENESS
Growth & returns
Opportunity scale
RESILIENCE
Risk, performance
&
uncertainty
STRATEGIC
INTENT
RESULTS
& PAY-
OUT
Grow
Exit
Fix/maintain
CHANGING EMPHASIS IN 2014+
SHARPER PORTFOLIO MANAGEMENT + APPRAISAL
11. 11Copyright of Royal Dutch Shell plc 29 January, 2015
PRIORITIES 2015+
Choices on new options
Supply chain management
Managing affordability +
financial flexibility
Preserving our competitive
growth pipeline in downturn
Continued ramp-up of 2014
start-ups
2015 transition year into
2016/17+ growth
Returns and cash flow
Competitive returns for
shareholders
Restructuring underperforming
businesses
Cost reduction programmes
Competitive financial
performance
Capital efficiency Project delivery
12. 12Copyright of Royal Dutch Shell plc 29 January, 2015
COMPETITIVE FINANCIAL PERFORMANCE
PORTFOLIO RESTRUCTURING
Optimise footprint
Integrated value capture
Selective investment in growth
markets
Capital discipline and project
delivery
Strong ROACE, 27% 2014
Free cash flow reduction:
Investment-heavy phase
Cost and profitability pressures
Late-life asset challenges
Resources plays Oil Products Upstream engine
Dry gas AcquisitionsLRS
NA portfolio reduction completed
2015+ reduction of International
portfolio
Capital ceiling + cost reduction
Capital investment in $ billion
Asset sales (incl. MLP)
$ billion $ billion kboe per day (Shell share)
CFFO Production (RHS)
Capital investment
-30%
13. 13Copyright of Royal Dutch Shell plc 29 January, 2015
COMPETITIVE FINANCIAL PERFORMANCE
RESTRUCTURING RESOURCES PLAYS PORTFOLIO
Production excludes volumes from divestments
Production
kboe per day
Capital investment
$ billion
E&A
On-stream
Gas Liquids Rich
Colombia
Argentina
Neuquen
Ukraine
Oman Sichuan
Changbei
Arrow CBM
Changbei 2
Russia
Americas InternationalLiquids Gas
Permian
Appalachia
W. Canada LRS
W. Canada gas
2014: North America portfolio
restructured ($3.3 billion asset
sales / 110 kboe/d)
2015+:
International portfolio reduction
+ possible write-downs
Potential to further reduce
spending
Tunisia
-30%
`
Germany
Algeria
Turkey
16. 16Copyright of Royal Dutch Shell plc 29 January, 2015
COMPETITIVE FINANCIAL PERFORMANCE
PORTFOLIO RESTRUCTURING: UPSTREAM ENGINE
* 2018/19 potential, Shell share
Upstream engine portfolio Managed decline of legacy positions
kboe per day (Shell share)
Restructuring focused on UKCS
Reducing overheads
Divesting assets
Free cash flow improvement
Operating costs and operational performance
Exit tail-end and underperforming assets
2017+ start-up of growth projects
Resilience
Attractiveness
~95
kboe/d*
Selective growth:
Schiehallion
Clair Ph2
Val d’ Agri ph2
Tempa Rossa
Beryl
Corrib
Maintain
Norway
NAM
Malaysia
Oman
New Zealand
Philippines
Fix
Denmark
Brunei
Gabon onshore
Exit / Dilute /
Decommissioning:
Nelson
Anasuria
Sean
Brent decommissioning
others
Netherlands
Oman
Malaysia
Norway
Brunei
UK
Abu Dhabi
Others
14 kboe/d
17. 17Copyright of Royal Dutch Shell plc 29 January, 2015
INVESTMENT PRIORITIES + PERFORMANCE
1 Iraq, Nigeria onshore (SPDC), Kazakhstan, Arctic, heavy oil
Engines (Downstream, Upstream engine)
Free cash flow businesses
Maintain competitiveness
Asset integrity + selective growth
Growth priority (Integrated Gas, deep water)
Global leadership established
High-grading our rich opportunity set
Longer term (resources plays, future opportunities1)
Major potential; managing non-technical risks
Slower pace + capital allocation
Investment choices driven on a global thematic basis
Assets tested for attractiveness + resilience
ROACE (%)
CFFO in billion $
Downstream
engine
Upstream engine
Integrated gas
Deep water
Resources plays
Future opportunities
2014
(Brent $99/bbl)
2013
(Brent $109/bbl)
Bubble size represents
year-end capital employed
18. 18Copyright of Royal Dutch Shell plc 29 January, 2015
COMPETITIVE, CREDIBLE + AFFORDABLE PLANS
MODERATING OUR SPENDING + GROWTH OUTLOOK
2014 acquisitions: Repsol LNG
$ billion total capital investment $ billion organic capital investment
Project re-phasing / deferral
Supply chain savings
Dilutions + exits
> -15%
2015 organic spending lower than 2014
Retaining options for medium term
Flexibility to reduce further
Upstream
Downstream / Corporate
Acquisitions
2015
potential
2015
plan
19. 19Copyright of Royal Dutch Shell plc 29 January, 2015
ROYAL DUTCH SHELL PLC
SIMON HENRY
CHIEF FINANCIAL OFFICER
20. 20Copyright of Royal Dutch Shell plc 29 January, 2015
ROYAL DUTCH SHELL PLC
FINANCIAL PERFORMANCE
21. 21Copyright of Royal Dutch Shell plc 29 January, 2015
Q4 2014 FINANCIAL HIGHLIGHTS
Earnings and ROACE on CCS basis, excluding identified items; ROACE 12 months rolling
Earnings Q4 2013 to Q4 2014
$ billion
Q4
2013
Q4
2014
$ billion
UPSTREAM 2.5 1.7
DOWNSTREAM (CCS) 0.6 1.6
CORPORATE & MINORITIES (0.1) (0.0)
CCS NET EARNINGS 2.9 3.3
CCS EARNINGS, $ PER SHARE 0.46 0.52
CASH FROM OPERATIONS 6.0 9.6
ROACE (%) 8.9 10.2
SHARE BUYBACKS 1.0 1.0
DIVIDENDS 2.8 3.0
DIVIDEND, $ PER SHARE 0.45 0.47
Environment Choice
22. 22Copyright of Royal Dutch Shell plc 29 January, 2015
Q4 2014 PERFORMANCE
Earnings on CCS basis, excluding identified items
Upstream earnings + cash flow
$ billion
Oil and gas production
million boe/d
Downstream earnings + cash flow
$ billion
Availability and sales volumes
%
million tonnes per annum
Upstream International Upstream Americas
Cash flow from operations (RHS)
sales volumes
Refinery availability
Chemicals availability Oil products (million bbls/d) (RHS)
Chemicals (million tonnes) (RHS)Oil Products Chemicals
CFFO (RHS)
Gas Oil LNG Sales volumes (RHS)
$ billion
$ billion
23. 23Copyright of Royal Dutch Shell plc 29 January, 2015
PRELIMINARY RESULTS
SEC PROVED RESERVES POSITION
1 Excludes acquisitions, divestments and price impacts
2 Reserves attributable to Royal Dutch Shell shareholders
2014 Reserves performance
2014 RRR 26%
2012-14 RRR 67%
Reserves life at end 2014 ~11.2 years
2012-14 Reserves average performance
Organic1 additions ~1.0 billion boe
Production ~1.2 billion boe
Organic reserves replacement 85%
Reserves Replacement SEC proved reserves
Major reserves additions
2012-14 Reserves additions
2012-14 2014
Organic 85% 47%
Organic incl. price effects 76% 50%
SEC proved reserves2 67% 26%
(billion boe) 2012 2013 2014
Organic reserves additions 1.0 1.5 0.5
Production 1.2 1.2 1.2
SEC proved reserves2 13.6 13.9 13.1
24. 24Copyright of Royal Dutch Shell plc 29 January, 2015
OIL + GAS RESOURCES FUNNEL
Converting resources to production…
Billion boe
Baronia EOR /
Tukau Timur
Bonga Main ph3
Coulomb ph2
Longer-term upside
2010 2011 2012 2013 2014
On-stream
Execute (under construction)
Select/Define
Production
Bonga North West
Cardamom
Gumusut-Kakap
Mars B
Petai
Sabah gas KBB
Asset sales + capital ceiling
Fewer FIDs in 2014
Maintaining attractive project
flow
Appomattox
Browse
resources plays
Val d’Agri ph2
Vito
others
25. 25Copyright of Royal Dutch Shell plc 29 January, 2015
CONVENTIONAL EXPLORATION
EXECUTING A CONSISTENT AND SUCCESSFUL EXPLORATION STRATEGY
ARCTIC
Long-term potential for
industry
FRONTIER
Build-up of acreage in
under-explored basins
HEARTLANDS
New plays in Shell
producing basins
NEAR-FIELD High-value add-ons
Prospect
size
(million boe)
Time to
development
(years)
15+
10+
3+
<3 5-50
50-250
>250
>500
Spend includes acquisitions
Low-cost access to new barrels: balancing exploration risk and returns
2015 spend
Frontier / Arctic
NFE
Heartlands / Libra
26. 26Copyright of Royal Dutch Shell plc 29 January, 2015
EXPLORATION: 2014 PERFORMANCE
Malaysia heartlands
NFE success, 3
heartland discoveries,
1 successful appraisal
~300 mmboe for Shell
in 2014
Gabon deep-water frontier
Sub-salt deep-water gas
discovery
Shell 75%, operator
Frontier
Near-field
Frontier basin
Improved delivery in 2014
10 frontier + heartlands successes
41 near-field finds
Australia heartlands
2014: Lympstone discovery
NFE success
2014 drilling success
Heartlands
GOM deep-water heartlands
2014: Rydberg, Kaikias, Power Nap
+ Gettysburg discoveries
>1300 mmboe for Shell 2009+
Brazil - Libra
NW1 successful appraisal
C-1 well drilling
Shell 20%
27. 27Copyright of Royal Dutch Shell plc 29 January, 2015
2015 OUTLOOK
Macro sensitivity @ $70-110/bbl Brent
2014 asset sales + license expiries
(2015 vs. 2014 impact)
-100 kboe/d; -0.3 mtpa LNG
~-75 kbpd refining capacity; -145 kbpd marketing
~-$1 billion divestment tax charge impacting CFFO
Maintenance downtime / other
(2015 vs. 2014 impact)
-60 kboe/d (Pearl T1, AOSP, GOM, others)
Reduced Chemicals availability (80% in 2015 vs.
85% in 2014)
Ramp-up of 2014 + 2015 start-ups
Macro
$10/bbl Brent +/- ~$3.3 billion CFFO/earnings per
annum
Q1-Q1 outlook:
Maintenance -90 kboe/d (Pearl + Auger)
Divestment, license expiry, Majnoon cost
recovery: ~ -200 kboe/d
Moerdijk chemicals downtime
Pearl GTL, Qatar
28. 28Copyright of Royal Dutch Shell plc 29 January, 2015
CAPITAL EFFICIENCY
FINANCIAL FRAMEWORK AND PRIORITIES
Priorities for cash
1. Debt service
2. Dividends: growth policy
3. Capital investment: disciplined
through-cycle growth
4. Return surplus cash: buybacks
Cash performance
Investment
Balance sheet
CFFO
Pay-out
Cash dividend Buyback
Gearing
CFFI
$ billion
%
$ billion
$ billion
$ billion
Net debt
Balancing cash in / cash out
across cycle
Maintaining strong balance
sheet
29. 29Copyright of Royal Dutch Shell plc 29 January, 2015
Short term Medium term
Strategic
long term
CONSISTENT DELIVERY OF COST REDUCTION PROGRAMMES
MULTI-BILLION $ OPPORTUNITY IN SHELL + SUPPLY CHAIN
North America resources plays
$ million 2014 savings (opex + capex)
Supply chain
Drilling, projects and operating costs excludes portfolio effects
Contract renegotiations
Design to cost/Design to value
Use of EFAs/location choice
Price
Design
Demand
>15%
savings
Supply chain
Low-cost countries + global suppliers
Standardisation
Overheads
Right-sizing with asset sales
Offshoring + efficiency drive
Multi-billion dollar reduction in supply chain
Operating cost reduction 2014-15
30. 30Copyright of Royal Dutch Shell plc 29 January, 2015
2014
Woodside 9.5%
Wheatstone LNG
Australia downstream
Italy downstream
US midstream MLP
NA non-core LRS
Pinedale + Haynesville dry gas
BC-10 dilution
ADCO license expiry
Nigeria onshore
315 kboe/d oil + gas
~120,000 b/d refining capacity
240,000 b/d marketing
0.6 mtpa LNG
CAPITAL EFFICIENCY
EARLY DELIVERY OF 2014-15 $15 BILLION DIVESTMENT PLAN
Divestment/exitAsset sales add focus
$ billion
Asset sales + MLP proceeds
$5-6 billion p.a. ongoing divestment
2015 divestments likely lower pace
Early delivery
of 2014-15
target Australia upstream
refocus
Monetise non-core
Oil Products
Resources plays
reduction
ongoing footprint reduction
31. 31Copyright of Royal Dutch Shell plc 29 January, 2015
PORTFOLIO CHOICES DRIVING PROFITABILITY
Upstream CFFO*
$ billion
Production
million boe per day
Enhancing profitability
+25%
* CFFO excludes working capital + oil & gas price effects
Underlying +2%
32. 32Copyright of Royal Dutch Shell plc 29 January, 2015
Growth priorities unchanged
Driving competitive cash flow
CAPITAL EFFICIENCY
INVESTMENT PRIORITIES
1 Resources plays, Majnoon, infill drilling
Organic capital investmentInvestment themes
Growth priorities: 40%
Longer term: 25%
Engines: 35%
2015
organic capital
investment
50%
10%
40%
Pre-FID large
project options
Base
Short-cycle
projects1
Post-FID large
projects
Conventional
exploration
2015
organic capital
investment
CFFO impact
of 2015 investment
’15-’16
’17-’18
‘19+
33. 33Copyright of Royal Dutch Shell plc 29 January, 2015
CASH PERFORMANCE + PAY-OUT
Cash flow
$ billion
Cash flow from operations Cash flow from investments1
2014 dividend and buyback $15 billion
2015 dividend ~$12 billion
Buybacks in 2015 subject to oil prices
Gearing likely to increase in 2015
$ billion
Gearing and pay-out
Dividend track record
$ billion
Dividends announced
2012-2014 2014
Dividend Free cash flow
%
Gearing (RHS)Buybacks
Pay-out
Dividend is dividend announced
1 Includes MLP proceeds
34. 34Copyright of Royal Dutch Shell plc 29 January, 2015
BEN VAN BEURDEN
CHIEF EXECUTIVE OFFICER
ROYAL DUTCH SHELL PLC
35. 35Copyright of Royal Dutch Shell plc 29 January, 2015
ROYAL DUTCH SHELL PLC
PROJECT DELIVERY
36. 36Copyright of Royal Dutch Shell plc 29 January, 2015
BC-10 ph3
Bonga Main ph3
Corrib
Erha North ph2
Forcados Yokri
Gbaran-Ubie ph2
Gorgon LNG
ML South
NA LRS/tight gas
Stones
2017-192015-16
PROJECTS UNDER CONSTRUCTION
Production
kboe per day (Shell share) million tonnes per annum
>700 kboe/d + 7.5 mtpa LNG under
construction
High-margin production
Growth uptick 2017+
2015-16 start-ups2014 start-ups
LNG volume (RHS)2017-19 start-ups
Mars B
Bonga NW
Cardamom
Baronia /Tukau Timur
Carmon Creek
Clair ph2
Coulomb
Kashagan ph1
Malikai
MMLS LNG (Elba)
Prelude FLNG
Rabab Harweel
Schiehallion
Southern Swamp
Tempa Rossa
TNP loopline
Gumusut-Kakap
Petai
Sabah gas KBB
2014
Shell-operated
started up
37. 37Copyright of Royal Dutch Shell plc 29 January, 2015
PROJECT DELIVERY
MANAGING OUR OPPORTUNITY SET
2015-16 FID options 17 potential FIDs 2015-16
>$15 billion spending mitigation planned
2015-17:
Re-phasing / deferral
Supply chain
Dilutions + exits
Downstream
Upstream
Options deferred /
cancelled
FID choices
2015-16
FUTURE
OPPORTUNITIES
Carmon Creek ph3+4
postponed
Majnoon full field
RESOURCES
PLAYS
World-wide restructuring Canada, Lower 48,
Argentina, other
DEEP WATER
Deferral of FIDs
Slower pace in Nigeria
Appomattox
Vito
Bonga South West
Libra pilot FPSO vessel
INTEGRATED
GAS
Asia Pacific slow-down
Arrow LNG greenfield
cancelled
Elba LNG (site)
LNG Canada T1+2
Browse LNG
UPSTREAM
ENGINE
Selected base projects Val d’Agri ph2
Bokor
DOWNSTREAM
ENGINE
Al Karaana chemicals
cancelled
Selected base projects
Pennsylvania chem.
Geismar alpha olefins
China chemicals
Debottleneck projects
> 700 kboe/d
~12 mtpa LNG
2.7 mtpa chemicals
38. 38Copyright of Royal Dutch Shell plc 29 January, 2015
COMPETITIVE PERFORMANCE: BALANCING GROWTH AND RETURNS
Free cash flow: cash flow from operations less cash used in investing activities
ROACE underlying: European companies: CCS basis excluding identified items. US companies: reported earnings excluding special non-operating items
Cash flow from operations
$ billion
Free cash flow
$ billion
ROACE – underlying
%
Total shareholder return (2012-2014)
%
Shell Peer group
Shell competitors
39. 39Copyright of Royal Dutch Shell plc 29 January, 2015
PRIORITIES 2015+
Choices on new options
Supply chain management
Managing affordability +
financial flexibility
Preserving our competitive
growth pipeline in downturn
Continued ramp-up of 2014
start-ups
2015 transition year into
2016/17+ growth
Returns and cash flow
Competitive returns for
shareholders
Restructuring underperforming
businesses
Cost reduction programmes
Competitive financial
performance
Capital efficiency Project delivery
40. 40Copyright of Royal Dutch Shell plc 29 January, 2015
QUESTIONS & ANSWERS
FOURTH QUARTER 2014 RESULTS
41. 41Copyright of Royal Dutch Shell plc 29 January, 2015
KEY UPSTREAM PROJECTS UNDER CONSTRUCTION
Deep water
Integrated gas
Resources plays
Future opportunities
Upstream engine
42. 42Copyright of Royal Dutch Shell plc 29 January, 2015
PRE-FID OPTIONS
POTENTIAL 2015-2016 FEEDS AND FIDS
Deep water
Integrated gas
Resources plays
Future opportunities
Downstream engine
Upstream engine
43. 43Copyright of Royal Dutch Shell plc 29 January, 2015
2014 CONVENTIONAL EXPLORATION: EXAMPLES
Frontier: Gabon deep water Heartland: GOM NFE: Oman, Lekhwair campaign
Noble Globetrotter 2 Exploration drilling in North Oman
Leopard sub-salt gas discovery
Multi-TCF potential
New gas play
Shell 75%
4 deep-water oil discoveries
Rydberg oil discovery in Norphlet
~110 million boe (Shell 57%)
Kaikias oil discovery
~35 million boe (Shell 100%)
Assessing new Power Nap +
Gettysburg finds
11 wells drilled in 2014
~150 million barrels oil (100%)
Further potential Greater
Lekhwair area
Shell 34%
Mars
Kaikias
Nakika
Vito
Appomattox
Mars B
Rydberg
Ram Powell
Ursa
On-stream
FEED
2014 exploration success
Brutus
100 km
Power Nap
Gettysburg
44. 44Copyright of Royal Dutch Shell plc 29 January, 2015
DELIVER NEW PROJECTS
PROJECT MANAGEMENT
Upstream project status
Construction time elapsed %
Oversight and accountability
Track record
Construction time elapsed %
photo
Corrib gas: national grid into Bellanaboy facility
45. 45Copyright of Royal Dutch Shell plc 29 January, 2015
2014
$ billion
CCS earnings CFFO
2014 organic
capital
investment
Capital
employed
ROACE
Engines
DOWNSTREAM
ENGINE
6 11 6 49 11%
UPSTREAM
ENGINE
5 8 7 18 27%
GrowthPriorities
INTEGRATED
GAS
10 13 6 58 18%
DEEP WATER
3 6 7 24 12%
LongerTerm
RESOURCES
PLAYS
(2) 0 4 20 (9)%
FUTURE
OPPORTUNITIES1
1 5 5 30 2%
DECONSTRUCTING OUR PORTFOLIO
Mature + drives free cash flow
Profitable + growing
Returns impacted by growth spend
CCS earnings excluding identified items; ROACE based on CCS earnings excluding identified items
1 Iraq, Nigeria onshore (SPDC), Kazakhstan, Arctic, heavy oil
46. 46Copyright of Royal Dutch Shell plc 29 January, 2015
CONVENTIONAL EXPLORATION + APPRAISAL: KEY WELLS 2015-2016
‘15 ‘16
Frontier
Heartlands
2015 drilling in 14 basins
Albania
US GOM
Brunei
Nigeria
Australia
Gabon
Turkey
China
Malaysia
Namibia
Canada
Denmark
Egypt
Brazil: Libra
Alaska
New Zealand
47. 47Copyright of Royal Dutch Shell plc 29 January, 2015
FOURTH QUARTER 2014 RESULTS
BALANCING GROWTH & RETURNS
29 JANUARY 2015
ROYAL DUTCH SHELL PLC