Fourth quarter 2016 results - PDF Free Download

Fourth quarter 2016 results Re-shaping Shell, to create a world-class investment case Royal Dutch Shell plc February 2, 2017 #makethefuture Royal Dutch Shell February 2, 2017

Ben van Beurden Chief Executive Officer Royal Dutch Shell Royal Dutch Shell February 2, 2017

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 (SPE) 2P + 2C definitions. Discovered and prospective resources: Our use of the term discovered and prospective resources are consistent with SPE 2P + 2C + 2U 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. Shales: Our use of the term shales refers to tight, shale and coal bed methane oil and gas acreage. Underlying operating cost is defined as operating cost less identified items. A reconciliation can be found in the quarterly results announcement. The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this release 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 release refer to companies over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated arrangements over which Shell has joint control are generally referred to as joint ventures and joint operations respectively. Entities 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 thirdparty interest. This release 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. Forwardlooking 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, goals, intend, may, objectives, outlook, plan, probably, project, risks, schedule, seek, should, target, will 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 release, 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 regulatory measures addressing climate change; (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. There can be no assurance that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this release 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 risk factors that may affect future results are contained in Royal Dutch Shell s 20-F for the year ended December 31, 2015 (available at www.shell.com/investor and www.sec.gov ). These risk factors also expressly qualify all forward looking statements contained in this release and should be considered by the reader. Each forward-looking statement speaks only as of the date of this release, February 2, 2017. Neither Royal Dutch Shell plc 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 release. With respect to operating costs synergies indicated, such savings and efficiencies in procurement spend include economies of scale, specification standardisation and operating efficiencies across operating, capital and raw material cost areas. We may have used certain terms, such as resources, in this release that United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our 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. Royal Dutch Shell February 2, 2017 3

Key messages RE-SHAPING SHELL PORTFOLIO PRIORITIES MANAGING THE DOWN-CYCLE Create a world class investment case Cash engines today s free cash flow Pulling levers to manage financial framework Grow free cash flow per share, higher ROCE More resilient and more focused company Growth priorities deep water and chemicals Future opportunities Re-set our costs Reduce debt shales and new energies BG integration completed; synergy delivery continues Royal Dutch Shell February 2, 2017 4

Transition 2016 + delivery 2017 + Leader: value + influence World-class investment case FCF/share + ROCE growth Conservative financial management Business mix underpins results Downstream + Integrated Gas offsetting Upstream Underlying CCS earnings 2016 $7 billion CFFO 2016 $21 billion Expected Q117 dividend $0.47 per share, unchanged Reducing our carbon intensity Shared value with society Continued drive to re-shape Shell Consolidated BG into Shell 2017 capital investment Progressing 4 levers: cost reductions, capital spend, divestments and project start-ups Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 5

Re-shape Shell Driving strategy in multiple time horizons Cash engines: today Funds dividends + balance sheet Growth priorities: 2016+ Cash engines 2020+ Future opportunities: 2020+ Material value + upside Competitive + resilient Affordable growth in advantaged positions Path to profitability Strong free cash flow and returns FCF + ROACE pathway Managed exposure CONVENTIONAL OIL + GAS INTEGRATED GAS DEEP WATER CHEMICALS SHALES NEW ENERGIES OIL SANDS MINING OIL PRODUCTS Relentless portfolio high-grading Royal Dutch Shell February 2, 2017 6

Divestments Reduce capital investment Reduce operating costs Deliver new projects Re-shape Shell Divestments progress: Gaining momentum Showa Shell SADAF JV exit UK North Sea assets Showa Shell Sekiyu K.K. Kawasaki Refinery, Japan SADAF Petrochemicals facility, Kingdom of Saudi Arabia Sale of ~31% of Showa Shell Sale of 50% petrochemicals Sale of package of UK North $30 billion 2016-18 Completed: ~$5 billion Announced: ~$5 billion Advanced progress: >$5 billion Sekiyu KK to Idemitsu ~$1.4 billion Lubricants and fuel brand licensing agreements Completed in 2016 SADAF joint venture to SABIC ~$0.8 billion Completion expected in 2017 Sea assets to Chrysaor $3 billion + up to ~$0.8 billion 115 kboe/d production in 2016 Completion expected in 2017 Royal Dutch Shell February 2, 2017 7

Divestments Reduce capital investment Reduce operating costs Deliver new projects Re-shape Shell Capital discipline, supporting growth Capital investment $ billion -$20 billion $ billion 2016 2017E 2018 Oil products 4 ~4 3-4 Conventional oil + gas 5 ~4 5-6 Integrated gas 4 ~5 4-5 Cash engines 30 Oil sands mining <1 <1 <1 25 Deep water 9 ~7 6-7 Chemicals 2 ~3 3-4 Growth priorities More predictable Shales 2 ~2 2-3 New energies <1 <1 <1 Future opportunities development flow Economic resilience of Total 27 ~25 25-30 projects Shell BG Excludes BG acquisition in 2016 Historical BG Capital investment is based on BG s published 2014 Annual Report Royal Dutch Shell February 2, 2017 8

Divestments Reduce capital investment Reduce operating costs Deliver new projects Re-shape Shell 2016: Moving quickly on office footprint Prince Rupert Kitimat Vancouver x x Calgary Aberdeen x Manchester x Reading x x Oslo x Stavanger x London x Rotterdam x Astana FTE movements # staff x 1,000 Mexico x x Houston x Trinidad & Tobago Equatorial Guinea x Tunisia x Cairo x Kenya Tanzania x Mumbai New Delhi Myanmar x x Bangkok Singapore x Beijing x Tokyo x Bolivia Uruguay x Rio de Janeiro Perth x Brisbane x x BG Shell Office closure Shell BG Net reductions Iconic moves London, Houston 25 closures in 16/ 17 Royal Dutch Shell February 2, 2017 9

Divestments Reduce capital investment Reduce operating costs Deliver new projects Portfolio priorities Delivering growth now Schiehallion redevelopment 125 kboe/d Shell 55% Scotford HCU debottleneck 14 kbpd Shell 100% Geismar AO4 425 ktpa alpha olephins Shell 100% Q4 2016 Pernis Solvent deasphalting 7.2 kbpd Shell 100% Kashagan 300 kboe/d Shell 17% Malikai 60 kboe/d Shell 35% ML South start-up 35 kboe/d Shell 35% Q4 2016 Stones 50 kboe/d Shell 100% Gorgon start-up 15.6 mtpa LNG Shell 25% BC-10 Ph3 Shell 50% 8 th FPSO Saquarema 150 kboe/d Shell 25% 10 th FPSO Lula South 150 kboe/d Shell 25% Forcados Yokri 50 kboe/d Shell 30% 7 th FPSO 1 st oil Maricá 150 kboe/d Shell 25% 9 th FPSO Caraguatauba 100 kboe/d Q4 2016 Shell 30% 11 th FPSO Lula North 150 kboe/d Shell 25% Gbaran Ubie ph2 150 kboe/d Shell 30% Start-up 2016 start-ups: >300 kboe/d ; 3.9 mtpa LNG 2016 start-up production: once fully ramped-up Royal Dutch Shell February 2, 2017 10

Re-shape Shell Financial performance: On-track 2013-15 ~$90 Capital employed ($ bln end 15) Free cash flow* ($ bln p.a) ROACE (%) 2016 ~$44 Capital employed ($ bln end 16) Free cash flow* ($ bln p.a) ROACE (%) 2019-21 ~$60 Capital employed ($ bln) Free cash flow* ($ bln p.a) ROACE (%) Cash engines ~65% 8 12 ~65% 2 5 ~65% 15-20 ~10 Growth priorities ~20% 0 11 ~25% -4 1 ~25% ~5 ~10 Future opportunities ~5% -4-12 ~5% -1-6 ~5% ~0 <5 Organic FCF 5-3 20-25 Organic FCF (excl. w/c) 0 3 20-25 Relentless portfolio highgrading Divestments Total (incl. Corporate, excl. w/c) 7 223 7 8 5 281 8 3 ~5 270-290 20-30 ~10 2019-21: 2016 RT $60 scenario, mid-cycle Downstream *FCF + proceeds from sale of interests in entities while retaining control; 2016 excluding BG cash element Royal Dutch Shell February 2, 2017 11

Simon Henry Chief Financial Officer Royal Dutch Shell Royal Dutch Shell February 2, 2017

Q4 2016 Financial highlights: Strong cash performance $ billion Q4 2015 Q4 2016 Upstream (1.0) 0.1 Integrated Gas 1.2 0.9 Downstream (CCS) 1.5 1.3 Corporate & non-controlling interest (0.2) (0.5) Earnings Q4 2015 to Q4 2016 $ billion Environment Choice CCS net earnings 1.6 1.8 CCS earnings, $ per share 0.25 0.22 Cash flow from operations 5.4 9.2 ROACE (%) 5.2 2.9 Dividends 3.0 3.8 Dividend, $ per share 0.47 0.47 Earnings and ROACE on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 13

Q4 2016 Earnings and cash flow momentum $ billion $ billion Earnings Cash flow from operations excluding working capital Cash flow from operations excluding working capital - 4 quarters rolling (RHS) Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 14

Preliminary results SEC proved reserves position 2016 Reserves performance 2016 RRR 208% 2014-16 RRR 81% BG Feb 16 ~2.4 billion boe Reserves life at end 2016 ~9.6 years Reserves performance Billion boe (billion boe) 2015 2016 Avg 3-yr Production 1.1 1.4 1.2 SEC proved reserves 1 11.7 13.2 12.7 Reserves life ~10.5 ~9.6 ~10.4 RRR -20% 208% 81% 2015 2016 1 Reserves attributable to Royal Dutch Shell shareholders Royal Dutch Shell February 2, 2017 15

Integration with BG BG portfolio is delivering Increasing production Thousand boe per day +30% Synergies BG $ billion 4.0 4.5 2.8 Conventional oil + gas LNG Deep water Costs Exploration Queensland LNG Brazil pre-salt Thousand boe per day T2 start up Nov 2015 # Thousand boe per day Majority of synergies 1 st LNG Train 1 Dec 2014 +70% FPSO Cidade de Caraguatatuba Lapa Field started on the 19 th of December. +100% captured Production delivery Re-shaping Shell learning BG Production Bid announced Number of cargoes delivered in the quarter (RHS) Royal Dutch Shell February 2, 2017 16

Re-shape Shell Integrated Gas from growth priority to cash engine Global LNG Sabine Pass Equity capacity Long-term offtake agreement Spot offtake in 2015-16 FY Deliveries in 2015-16 FY Atlantic LNG Peru LNG Nigeria Equatorial Guinea QG-4 Oman Sakhalin Malaysia Gorgon Brunei NWS Pluto QCLNG LNG volumes Million tonnes per annum Integrated Gas: earnings + cash flow $ billion IOC leadership position Global footprint Integrated Gas is >30% capital employed of Shell Value from optionality LNG sales volumes LNG liquefaction volumes Earnings Cash flow from operations Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 17

Improving our Downstream footprint and performance Portfolio change Backbone / grow: Chemicals China LNG for transport Premium fuels + lubes Refinery crude flexibility others Earnings + ROACE $ billion % 2016: Showa Shell Motiva split Denmark refining Malaysia refining PSPC IPO Denmark marketing MLP dropdowns (3) Attractiveness Fix: Exit: Netherlands Rheinland Manufacturing Australia Singapore Denmark marketing Motiva JV restructuring Harburg others Italy LPG France Norway Selected UK retail sites Tongyi lubricants China Showa Shell Malaysia refining Denmark refining SADAF petrochemicals JV completed others Marketing Refining & trading Chemicals ROACE (RHS) Resilience Earnings and ROACE on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 18

Deep water: Growing now Deep water growth Thousand boe per day 2016 delivery good progress to 2020 production growth to ~900 kboe/d Reducing break-even: new projects less than $45/bbl Brazil pre-salt well below $40/bbl Structural improvements in capital efficiency and operating cost reductions Gulf of Mexico Brazil Other Strong deep water capabilities combined with advantaged portfolio 1994 Auger 1996 Mars 1997 Ram Powell 1999 Ursa 2001 Brutus 2005 Bonga 2009 BC-10 2010 Perdido 2014 Mars B Gumusut- Kakap 2016 Stones Malikai Brazil pre-salt Under construction Coulomb Appomattox Kaikias Brazil pre-salt Royal Dutch Shell February 2, 2017 19

Americas shales: Growth to come Western Canada Gas Western Canada LRS Fox creek Appalachia Material discovered + prospective resources >11 billion boe 25% liquids, 75% gas Selective acceleration of liquids development Capital investment $2-3 billion per annum Dry gas Liquids rich Permian Haynesville Argentina Permian and Fox Creek growth of ~140 kboe/d Average break-even price ~$40 per barrel Production Thousand boe per day Advantaged positions in Permian and Fox Creek Improving capital efficiency and reducing unit operating costs Permian Fox Creek Other Permian well site Discovered + prospective resources shown at year end 2016; consistent with the Society of Petroleum Engineers 2P (Proved + Probable Reserves), 2C (Contingent Resources) and 2U (Prospective Resources) definitions. Royal Dutch Shell February 2, 2017 20

Manage down-cycle Cash flow priorities 2016-18 Priorities for cash 1 2 3 Debt reduction Dividends Buybacks & capital investment Powerful levers to underpin financial framework Divestments Reduce capital investment Reduce operating costs Deliver new projects Royal Dutch Shell February 2, 2017 21

Divestments Reduce capital investment Reduce operating costs Deliver new projects Manage down-cycle Divestments 2016-2018 2016-2018 completed + announced ($ billion) 2016 Completed Announced $30 billion 2016-18 Upstream 1.5 ~3.0 Completed: ~$5 billion Integrated Gas 0.4 ~0.9 Announced: ~$5 billion Downstream/Corporate 2.9 ~1.3 Advanced progress: >$5 billion TOTAL 4.7 ~5.2 Royal Dutch Shell February 2, 2017 22

Manage down-cycle Predictable highquality investment funnel Capital investment $ billion 58 47 36 Divestments -$20 billion 27 Reduce capital investment ~25 Reduce operating costs Deliver new projects $25-30 billion Base + short cycle BG Committed growth projects Shell + BG C.I. on a cash basis Growth options/exploration 2017E Planning for $25-$30 billion range 2016 $27 billion 2017 around $25 billion Focus on economic resilience of projects Excludes BG acquisition in 2016 Royal Dutch Shell February 2, 2017 23

Manage down-cycle Reduce operating cost: 20% down in 2 years Underlying operating cost $ billion -$10 billion 39 < $40 billion Divestments Reduce capital investment $10 billion reductions delivered Reduce operating costs Lower for ever mindset + BG synergies Deliver new projects Divestments, growth, FX impacts 2017 less than $40 billion Shell BG 2016 identified items Operating costs excluding identified items Royal Dutch Shell February 2, 2017 24

Divestments Reduce capital investment Reduce operating costs Deliver new projects Manage down-cycle Deliver new projects: ~$10 billion by 2018 Bonga NW Cardamom / 15 Shell projects start-ups 2014+ Thousand boe per day / mtpa $ billion 7-9 th FPSO Gorgon / 10 Gumusut-Kakap Kashagan / 5 ~$10 billion CFFO > 1 million boe/day Cash operating cost <$15/boe Tax rate ~35% Permian Start-up QCLNG Malikai Stones Production LNG volume 2016 CFFO (RHS) 2018E CFFO (RHS) BG organic growth from 1.1.2016; LNG volume includes offtake; 2016 RT $60 oil price scenario 2018 Royal Dutch Shell February 2, 2017 25

Manage down-cycle Pulling levers to manage financial framework 2016-18 levers Divestments Reduce capital investment Reduce operating costs Deliver new projects $ billion 2015 baseline: Shell + BG 2016 2017-2018 potential Reducing our cash breakeven Further options available +/- $10 Brent = ~$5 billion CFFO Underlying operating costs <$40 billion Operating costs 46 39 (underlying) Multi-billion p.a. Capital investment 36 27 25-30 Divestments 6 + 5 5 Projects start-up post-2014 (CFFO) n/a >$1 30 over 2016-18 ~10 by 2018* Capital investment excludes BG acquisition; BG organic growth from 1.1.2016; *2016 RT $60 oil price scenario 2018 Royal Dutch Shell February 2, 2017 26

Ben van Beurden Chief Executive Officer Royal Dutch Shell Royal Dutch Shell February 2, 2017

Questions & Answers Ben van Beurden Chief Executive Officer Simon Henry Chief Financial Officer Royal Dutch Shell February 2, 2017 29

Fourth quarter 2016 results Re-shaping Shell, to create a world-class investment case Royal Dutch Shell plc February 2, 2017 Let s make the future Royal Dutch Shell February 2, 2017

Q1 2017 Outlook Q1 Q1 OUTLOOK: Year-ago baseline reflects Shell s earnings seasonality BG fully consolidated, Q116 was 2 months Integrated gas Earnings negatively impacted by reduction ~-100 kboe/d Upstream Divestment impact: ~-45 kboe/d Maintenance: ~-40 kboe/d One additional month of production from BG assets Downstream Refinery availability increase Chemicals availability increase Divestment impact oil products sales volumes: ~-35 kboe/d 2017 OUTLOOK: Corporate segment : net charge, excluding the impact of currency exchange rate effects and interest rate movements, of $350 450 million in Q1; $1.4-1.6 billion 2017 Shell + BG earnings sensitivity: Brent: $10/bbl Brent +/- ~$5 billion earnings per annum, of which: Upstream +/- ~$3 billion Integrated Gas +/- ~$2 billion (4-6 month LNG price lag versus Brent) Henry Hub: $1/mmbtu +/- ~$250 million earnings per annum Royal Dutch Shell February 2, 2017 31

Q4 2016 Prices & margins Shell oil & gas realisations $/barrel $/mscf Industry refining margins $/barrel Industry chemicals margins $/tonne Oil Gas (RHS) US West Coast US Gulf Coast coking US ethane Western Europe naphtha Rotterdam complex Singapore NE/SE Asia naphtha Royal Dutch Shell February 2, 2017 32

Q4 2016 Upstream results Earnings Q4 2015 to Q4 2016 $ billion Environment Choice Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 33

Q4 2016 Integrated Gas results Earnings Q4 2015 to Q4 2016 $ billion Environment 2.0 Choice 1.0 0 Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 34

Q4 2016 Downstream results Earnings Q4 2015 to Q4 2016 $ billion Earnings mix $ billion Marketing Refining & Trading Chemicals Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 35

Q4 2016 Oil and gas production Upstream + Integrated Gas oil & gas Million boe per day Choice: +31% 4.00 LNG liquefaction volumes Million tonnes 3.75 3.50 3.25 3.00 2.75 Royal Dutch Shell February 2, 2017 36

2016 Financial highlights Earnings 2015 to 2016 $ billion Earnings Q4 2015 to Q4 2016 $ billion Earnings on CCS basis, excluding identified items Royal Dutch Shell February 2, 2017 37

Financial dashboard Gearing % Free cash flow per share $/share ROACE Total shareholder return % % 3-years: 2014-2016 % 2016 Shell Peer group Competitive financial data as published. Free cash flow: cash flow from operations less cash used in investing activities. $/ADR for European companies. ROACE underlying: European companies: CCS basis excluding identified items. US companies: reported earnings excluding special non-operating items. Capital employed on gross debt basis. Royal Dutch Shell February 2, 2017 38

Q4 2016 Sources and uses of cash $ billion Q4 2016 2016 Beginning cash 20.0 31.8 Earnings 1.6 4.8 2016 Full year $ billion Depreciation 6.6 25.0 Working capital / other 1.0 (9.2) Divestments 3.0 4.7 Capex / other investment (6.1) (23.2) BG acquisition cash - (11.4) Shareholder distributions (2.4) (9.9) Priorities for cash: Debt reduction Dividends Debt / other financing 4.5 6.5 Ending cash 19.1 19.1 Buybacks + capital investment Debt / other financing Divestments Cash flow from operations BG acquisition cash element Capex / other investment Dividend Royal Dutch Shell February 2, 2017 39

Projects under construction Start up Project Country Shell share (direct & indirect) % Peak Production 100% kboe/d LNG 100% Capacity mtpa Products Legend Theme Shell Operated 2017-18 Baronia / Tukau Timur Malaysia 40 65 Conventional oil + gas Berbigão** Brazil 25 150 Deep water Clair Ph2 United Kingdom 28 100 Conventional oil + gas Coulomb United States 100 20 Deep water Fox Creek* Canada various 26 Shales Forcados Yokri Interagted Project (FYIP) Nigeria 30 50 Conventional oil + gas Gbaran-Ubie Ph2 Nigeria 30 150 Conventional oil + gas Geismar AO4 United States 100 425 kta AO Chemicals Gorgon T3 Australia 25 5.2 Integrated Gas Lula Extreme South** Brazil 25 150 Deep water Lula North** Brazil 25 150 Deep water Lula South** Brazil 25 150 Deep water Permian* United States various 54 Shales Prelude FLNG Australia 68 131 3.6 1.7 mtpa NGLs Integrated Gas Pernis solvent deasphalting Netherlands 100 7.2 kbpd Oil Products Schiehallion Redevelopment United Kingdom 55 125 Conventional oil + gas Tempa Rossa Italy 25 50 Conventional oil + gas 2019+ Appomattox United States 79 175 Deep water Atapu 1** Brazil 25 150 Deep water Atapu 2** Brazil 25 150 Deep water Kaikias Ph1 United States 80 40 Deep water Nanhai China Chemicals China 50 1200 kta C2 Chemicals Pennsylvania cracker United States 100 1500 kta C2 Chemicals Rabab Harweel Integrated Project Oman 34 40 Conventional oil + gas Southern Swamp AG Nigeria 30 30 Conventional oil + gas * Permian and Fox Creek production represents Shell entitlement share of production and is the production growth expected between 2016 peak to 2018 peak production ** The Lula, Berbigão, Sururu, Atapu accumulations are subject to unitisation agreements; production shown is FPSO oil capacity as per operator Royal Dutch Shell February 2, 2017 40

Pre-FID options Phase Project Country Shell share (direct & indirect) % Peak Production 100% kboe/d LNG 100% Capacity mtpa Products Legend Theme Shell Operated Select Bonga Main Integrated Redevelopment Nigeria 55 112 Deep water Libra pilot FPSO* Brazil 20 180 Deep water LNG Canada T3-4 Canada 50 14 Integrated Gas Define Bonga South West Nigeria 43 154 Deep water Bokor Malaysia 40 12 Conventional oil + gas Changbei II China 50 57 Integrated Gas Lake Charles United States 100 16 Integrated Gas LNG Canada T1-2 Canada 50 14 Integrated Gas Penguins Redevelopment United Kingdom 50 40 Conventional oil + gas Sakhalin T3 Russia 28 69 ~5 Integrated Gas Val d'agri Ph2 Italy 39 60 Conventional oil + gas Vito United States 63 100 Deep water * Production shown is FPSO oil capacity as per operator Royal Dutch Shell February 2, 2017 41

Royal Dutch Shell February 2, 2017