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Royal Dutch Shell first quarter 2019 results

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Jessica Uhl, Chief Financial Officer of Royal Dutch Shell plc hosted a live audio webcast of the 2019 first quarter results on Thursday May 2, 2019.

Veröffentlicht in: Investorbeziehungen
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Royal Dutch Shell first quarter 2019 results

  1. 1. Royal Dutch Shell May 2, 2019 Royal Dutch Shell plc May 2, 2019 First quarter 2019 results Delivering a world-class investment case #makethefuture
  2. 2. Royal Dutch Shell May 2, 2019 Jessica Uhl Chief Financial Officer Royal Dutch Shell
  3. 3. Royal Dutch Shell May 2, 2019 3 Definitions & cautionary note Gearing is defined as net debt (current and noncurrent debt less cash and cash equivalents, adjusted for fair value of derivative financial instruments used to hedge foreign exchange and interest rate risks relating to debt, and associated collateral balances) as a percentage of total capital (net debt plus total equity). Free Cash Flow is defined as the sum of “Cash flow from operating activities” and “Cash flow from investing activities”. Cash flow from operating activities excluding working capital movements is defined as “Cash flow from operating activities” less the sum of the following items in the Consolidated Statement of Cash Flows: (i) (increase)/decrease in inventories, (ii) (increase)/decrease in current receivables, and (iii) increase/(decrease) in current payables. Organic free cash flow is defined as free cash flow excluding inorganic capital investment (acquisitions; Q1 2019 4Q rolling amounting to $0.4 billion) and divestment proceeds (Q1 2019 4Q rolling amounting to $9.6 billion). ROACE on a CCS basis excluding identified items is defined as the sum of CCS earnings excluding identified items for the current and previous three quarters, adjusted for after-tax interest expense, expressed as a percentage of the average capital employed for the same period. The after-tax interest expense is calculated using the effective tax rate for the same period. Capital employed consists of total equity, current debt and non-current debt. Earnings on a current cost of supplies basis (CCS earnings) is the income for the period, adjusted for the after-tax effect of oil-price changes on inventory. Basic CCS earnings per share is calculated by dividing CCS earnings attributable to shareholders by the average number of shares outstanding over the year. Capital investment comprises Capital expenditure, Investments in joint ventures and associates and Investments in equity securities, exploration expense excluding well write-offs, leases recognised in the period and other adjustments. Cash capital expenditure is introduced with effect from January 1, 2019, comprising the following lines from the Consolidated Statement of Cash Flows: Capital expenditure, Investments in joint ventures and associates and Investments in equity securities. Reconciliations of the above non-GAAP measures are included in the Royal Dutch Shell plc Unaudited Condensed Interim Financial Report for three-month period ended March 31, 2019. Also, in this presentation we may refer to “Shell’s Net Carbon Footprint”, which includes Shell’s carbon emissions from the production of our energy products, our suppliers’ carbon emissions in supplying energy for that production and our customers’ carbon emissions associated with their use of the energy products we sell. Shell only controls its own emissions but, to support society in achieving the Paris Agreement goals, we aim to help and influence such suppliers and consumers to likewise lower their emissions. The use of the terminology “Shell’s net carbon footprint” is for convenience only and not intended to suggest these emissions are those of Shell or its subsidiaries. The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this presentation “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 Royal Dutch Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this presentation refer to entities 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 an entity or unincorporated joint arrangement, after exclusion of all third-party interest. This presentation contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) 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 “aim”, “ambition’, ‘‘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 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 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. No assurance is provided that future dividend payments will match or exceed previous dividend payments. 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 risk factors that may affect future results are contained in Royal Dutch Shell’s Form 20-F for the year ended December 31, 2018 (available at www.shell.com/investor and www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this presentation and should be considered by the reader. Each forward-looking statement speaks only as of the date of this presentation, May 2, 2019. 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 presentation. We may have used certain terms, such as resources, in this presentation that the 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.
  4. 4. Royal Dutch Shell May 2, 2019 4 Summary Divestments: headline as per announcement. Key messages ◼ Q1 2019 Strong results Cash flow from operations excl. working capital movements of $12.1 billion CCS earnings of $5.3 billion Confidence in delivery of 2020 commitments ◼ Portfolio reshaping Continued growth in Deep water, Conventional Oil & Gas, Retail Further $2 billion divestments announced or completed in 2019 ◼ Financial framework Cash priorities, capital discipline unchanged Next $2.75 billion tranche of share buybacks announced Thrive in the energy transition World-class investment case Strong license to operate
  5. 5. Royal Dutch Shell May 2, 2019 ◼ Of which $3.4 billion organic free cash flow Disciplined cash allocation Cash generation 5 Q1 2019 Financial highlights: summary Earnings and ROACE on CCS basis, excluding identified items. ROACE according to new definition (updated as of Q1 2019). Share buybacks: repurchases completed in Q1 2019, tranches announced do not align with quarters. Share buybacks subject to further progress with debt reduction and oil price conditions. Q1 2019 average Brent price: $63/bbl Gearing Share buybacks Capital investment ◼ Strong cash generation across all businesses ◼ Negative impact of working capital movements ($3.5) billion Cash flow from operations excluding working capital Free cash flow EarningsReturns ◼ IFRS 16 lease recognition resulted in gearing increase by 4.6% ◼ Further negative impact from working capital movements ◼ 2019 capital investment of $25-30 billion (pre-IFRS 16) ◼ Next tranche of up to $2.75 billion announced ◼ Intention to purchase $25 billion by end of 2020 Cash capital expenditure $12.1 billion $4.0 billion $5.3 billion 26.5% $2.3 billion $6.7 billion $5.6 billion ◼ Compared to capital investment excludes ~$1 billion leases capitalised in Q1 2019 and $0.2 billion exploration expense 8.4%ROACE ◼ ROACE of 8.6% pre-IFRS 16 change ◼ Higher contributions from LNG optimisation and Downstream ◼ Strong Upstream contribution, mainly from US Gulf of Mexico
  6. 6. Royal Dutch Shell May 2, 2019 6 Competitive performance Competitive financial data as per company reports. CFFO excl. working capital corrected for interest received (in CFFI) and interest paid (CFFF) for RDS. ROACE according to new definition (updated as of Q1 2019). ROACE: European companies: CCS basis excluding identified items (or equivalent), US companies: reported earnings excluding special non-operating items, adjusted for after-tax interest expense; Capital employed on gross debt basis, including lease liabilities. $ billion ◼ Sector-leading cash generation CFFO excl. working capital – 4 quarters rolling % Clean CCS ROACE – 4 quarters rolling ◼ Improving ROACE on clean CCS basis Shell Peer group 0 10 20 30 40 50 16Q1 16Q3 17Q1 17Q3 18Q1 18Q3 19Q1 Thousands 0 2 4 6 8 10 16Q1 16Q3 17Q1 17Q3 18Q1 18Q3 19Q1
  7. 7. Royal Dutch Shell May 2, 2019 No harm Good products Trusted company 7 Strong societal licence to operate Shell has a long history of caring
  8. 8. Royal Dutch Shell May 2, 2019 ◼ Retail growth – in last 2 quarters, 250 sites added in growth markets ◼ V-Power reach – 900 sites in China now offering V-Power ◼ Retail offers – new customer offers including nature-based solutions carbon offsets ◼ SASREF refinery – sale of Shell’s full equity interest (50%) to Saudi Aramco 8 Q3 2018 Other portfolio developments ◼ P-67 FPSO – first production from Lula North in the Brazilian Santos Basin ◼ Basrah Gas Company – FID on growth programme; to increase capacity by 40% ◼ Blacktip – discovery in Deep water Gulf of Mexico with more than 400 feet of net oil pay ◼ Caesar-Tonga – sale of interest in Deep water Gulf of Mexico asset for $965 million ◼ Prelude – first condensate cargo loaded on 23 March 2019 ◼ Greater Sunrise – completed sale of interest in Timor-Leste for $300 million consideration ◼ sonnen – 100% acquisition, a leader in smart energy storage systems and innovative energy services for households ◼ Limejump – 100% acquisition, a UK-based energy technology company providing optimised routes to market for customers with electricity generating or consuming assets ◼ Greenlots – 100% acquisition, a US-based leader in electric vehicle (EV) charging and energy management software and solutions Portfolio highlights Upstream and Integrated Gas Downstream New Energies
  9. 9. Royal Dutch Shell May 2, 2019 SASREF refinery, Saudi Arabia Portfolio rationalisation – SASREF refinery 9 Portfolio highlights High-grading our refinery portfolio ◼ Shell to sell its full 50% interest in the SASREF refining joint venture to Saudi Aramco ◼ SASREF represents a long and successful collaboration between Shell and Saudi Aramco ◼ Divestment is part of Shell’s drive to focus its refining portfolio on sites closely integrated with trading hubs and chemicals facilities ◼ Installation of two crude oil tanks at Bukom refinery ◼ Storage capacity increased by around 1.3 million barrels of crude oil, offering flexible options leading up to IMO2020 ◼ Strengthens Bukom’s flexibility and enables further supply and distribution optimisation, secures the best- value crude for the refinery Portfolio optimisation – Bukom refinery Pulau Bukom refinery, Singapore
  10. 10. Royal Dutch Shell May 2, 2019 $ billion Q1 2018 Q1 2019 of which IFRS 16 impact Integrated Gas 2.4 2.6 +0.06 Upstream 1.6 1.7 +0.04 Downstream (CCS) 1.8 1.8 +0.04 Corporate & non-controlling interest (0.4) (0.8) -0.18 CCS earnings 5.4 5.3 -0.04 CCS earnings, $ per share 0.65 0.65 -0.01 ROACE (%) 7.1 8.4 -0.2 Q1 2019 Financial highlights: earnings Earnings and ROACE on CCS basis, excluding identified items. Graph: Individual categories presented excluding IFRS 16 impact; IFRS 16 impact on individual categories: Prices and Margins +$0.2bln, Cost +$0.4bln, DD&A -$0.5bln, Interest -$0.2bln. $ billion Earnings Q1 2018 to Q1 2019 5.4 5.3 ~0 0.2 0.2 0.4 ~(0) (0.2) (0.7) 0 2 4 6 8 10
  11. 11. Royal Dutch Shell May 2, 2019 $ billion Q1 2018 Q1 2019 of which IFRS 16 impact Integrated Gas 2.6 4.2 +0.28 Upstream 3.6 5.3 +0.19 Downstream 3.1 (0.6) +0.45 Corporate 0.2 (0.3) +0.04 Cash flow from operations 9.5 8.6 +0.95 Cash flow from operations excl. working capital 10.4 12.1 +0.81 Cash flow from investing activities (4.3) (4.6) +0.12 Free cash flow 5.2 4.0 +1.07 Dividend (4.0) (3.9) - Interest paid (0.9) (1.1) -0.28 Share buybacks - (2.3) - 11 Q1 2019 Financial highlights: cash flow Dividend distributed to RDS shareholders. $ billion CFFO excl. working capital Q1 2018 to Q1 2019 10.4 12.1 0.9 0.3 0.3 ~(0) 0.8 (0.5) 0 4 8 12 16
  12. 12. Royal Dutch Shell May 2, 2019 ◼ $1.1 billion, due to higher CFFO and lower CFFI Disciplined cash allocation Cash generation 12 Q1 2019 Financial highlights: IFRS 16 Earnings and ROACE on CCS basis, excluding identified items. ROACE according to new definition (updated as of Q1 2019). Share buybacks: repurchases completed in Q1 2019, tranches announced do not align with quarters. Share buybacks subject to further progress with debt reduction and oil price conditions. Q1 2019 average Brent price: $63/bbl ◼ Operating lease costs reported as depreciation and interest; net negative impact of $43 million - not material Gearing Share buybacks Capital investment $11.3 billion ◼ $0.8 billion, as lease payments now reported in CFFF ◼ Increase in payables of $0.1 billion (affecting working capital) $2.9 billion Cash flow from operations excluding working capital Free cash flow Earnings $5.3 billionReturns 21.9% ◼ 4.6%, as $16.2 billion lease liabilities recorded on balance sheet $2.3 billion $6.0 billion ◼ $0.7 billion to financial leases capitalized in the quarter Cash capital expenditure $12.1 billion $4.0 billion $5.3 billion 26.5% $2.3 billion $6.7 billion $5.6 billion Pre-IFRS 16Post-IFRS 16 ◼ New performance measure; adds capital spend transparency and allows visibility for underlying capital costs excluding leases 8.4% 8.6%ROACE ◼ 0.2% on higher closing capital employed, partly offset by higher after-tax interest
  13. 13. Royal Dutch Shell May 2, 2019 13 Summary Divestments: headline as per announcement. Key messages ◼ Q1 2019 Strong results Cash flow from operations excl. working capital movements of $12.1 billion CCS earnings of $5.3 billion Confidence in delivery of 2020 commitments ◼ Portfolio reshaping Continued growth in Deep water, Conventional Oil & Gas, Retail Further $2 billion divestments announced or completed in 2019 ◼ Financial framework Cash priorities, capital discipline unchanged Next $2.75 billion tranche of share buybacks announced Thrive in the energy transition World-class investment case Strong license to operate
  14. 14. Royal Dutch Shell May 2, 2019 14 Questions & Answers Jessica Uhl Chief Financial Officer Royal Dutch Shell May 2, 2019 Reminder of key dates: ◼ Annual General Meeting May 21, 2019 ◼ Management Day 2019 June 4, 2019 London June 5, 2019 New York ◼ Q2 2019 Results August 1, 2019
  15. 15. Royal Dutch Shell May 2, 2019
  16. 16. Royal Dutch Shell May 2, 2019 Outlook Q2 2019 outlook As of 2019, Salym (Russia) is reported within the Upstream segment. 2018 production: 62 kboe/d Shell share (97% liquids); 2018 net income: $0.1 billion. Q2 2018 – Q2 2019 OUTLOOK: Year-ago baseline reflects Shell’s earnings seasonality ◼ Integrated Gas ◼ Production volumes: 10-50 thousand boe/d lower, mainly due to divestments, transfer of Salym into the Upstream segment, partly offset by new field ramp-ups and lower maintenance activities ◼ LNG liquefaction volumes: expected to be at a similar level ◼ Upstream ◼ Production volumes: 150-200 thousand boe/d higher, mainly due to new field ramp-ups, lower maintenance activities and transfer of Salym, partly offset by divestments and field decline ◼ Downstream ◼ Refinery availability expected to increase, as a result of lower maintenance activity ◼ Chemicals availability expected to decrease, as a result of higher maintenance activity ◼ Oil products sales volumes: 40-70 thousand boe/d lower, mainly as a result of the divestment in Argentina 2019 OUTLOOK: ◼ Corporate segment: net charge of $650-700 million in Q2, and $2.6-2.8 billion for the full year 2019 on a post-IFRS 16 basis, excluding the impact of currency exchange rate effects 16
  17. 17. Royal Dutch Shell May 2, 2019 17 Earnings and ROACE on CCS basis, excluding identified items. ROACE according to new definition (updated as of Q1 2019). Pricing assumption 2020: $60 per barrel real terms 2016, mid-cycle Downstream. $ billion -2 0 2 4 6 8 10 -5 0 5 10 15 20 25 2015 2016 2017 2018 19Q1 4QR Earnings & ROACE $ billion -20 0 20 40 60 2015 2016 2017 2018 19Q1 4QR Cash flow $ billion 0 10 20 30 0 25 50 75 100 2015 2016 2017 2018 19Q1 Gearing ◼ 4Q rolling earnings of $21 billion, negligible impact of IFRS 16 ◼ ROACE decreased by 0.3% to 8.4% compared to Q4 2018, in large part driven by increased closing capital employed balance due to IFRS 16 ◼ $38 billion free cash flow 4Q rolling ◼ $29 billion organic free cash flow ◼ $1.1 billion help from IFRS 16 ◼ On track to deliver 2019-2021 outlook ◼ Gearing increased to 26.5%, mostly as effect of IFRS 16 ◼ Excluding IFRS 16 net debt increased by $4.7 billion, with gearing up from 20.3% in Q4 2018 to 21.9% in Q1 2019 Q1 2019 (4Q rolling) average Brent price: $70/bbl % % Upstream ROACE (RHS) Downstream Integrated Gas Corporate + NCI CFFO CFFI FCF Net debt (at period end) Gearing (RHS) Q1 2019 Financial highlights: improving year on year IFRS 16 impact Gearing pre-IFRS 16 (RHS)FCF pre-IFRS 16ROACE pre-IFRS 16 (RHS)
  18. 18. Royal Dutch Shell May 2, 2019 27 0 5 10 15 20 25 30 35 Q12019 4QR Price normalisation Q12019 4QR,normalised CFFOfrom keyprojects 2019-2021 outlook 18 Outlook Organic free cash flow 2019-2021 outlook at $60 per barrel real terms 2016, mid-cycle Downstream. Organic free cash flow normalised to stable $60 per barrel real terms 2016 oil price environment in 2020, assuming no working capital or margining movements. Impact of IFRS 16 removed as 2019-2021 outlook provided pre-IFRS 16 implementation. Price effect between current Brent price and 2019-2021 outlook is indicative, calculated using rule-of-thumb. $ billion Organic free cash flow bridge to 2019-2021 outlook ◼ On track to deliver 2019-2021 outlook of $25-30 billion organic free cash flow ◼ Normalised organic free cash flow excludes effects of IFRS 16 and working capital movements ◼ New projects provide free cash flow growth ◼ Compared to Q4 2018, normalised organic free cash flow improved by ~$1 billion 25-30>5 (3) ~29 ~24 Organic free cash flow Working capital movement and IFRS 16 impact
  19. 19. Royal Dutch Shell May 2, 2019 Q1 2019 Prices & margins $/barrel Shell oil & gas realisations $/barrel Industry refining margins $/tonne Industry chemicals margins 0 1 2 3 4 5 6 0 20 40 60 80 18Q1 18Q2 18Q3 18Q4 19Q1 0 3 6 9 12 15 18 18Q1 18Q2 18Q3 18Q4 19Q1 0 200 400 600 800 1000 18Q1 18Q2 18Q3 18Q4 19Q1 US ethane Western Europe naphtha NE/SE Asia naphtha US West Coast US Gulf Coast coking Rotterdam complex Singapore Oil Gas (RHS) 19 $/mscf
  20. 20. Royal Dutch Shell May 2, 2019 2.4 2.6 0.3 ~0 0.2 0.1 (0.3) (0.1) (0.1) 0 1 2 3 20 Q1 2019 Integrated Gas results $ billion Earnings Q1 2018 to Q1 2019 Environment Choice Earnings on CCS basis, excluding identified items. Individual categories presented excluding IFRS 16 impact; IFRS 16 impact on individual categories: Prices & margins +$0.16bln, Cost +$0.04bln, DD&A -$0.14bln.
  21. 21. Royal Dutch Shell May 2, 2019 1.6 1.7 0.5 0.2 ~0 (0.1) (0.3) ~(0) (0.1) ~(0) 0 1 2 3 21 Q1 2019 Upstream results $ billion Earnings Q1 2018 to Q1 2019 Environment Choice Earnings on CCS basis, excluding identified items. Individual categories presented excluding IFRS 16 impact; IFRS 16 impact on individual categories: Cost +$0.14bln, DD&A -$0.10bln.
  22. 22. Royal Dutch Shell May 2, 2019 1.8 1.8 0.2 0.2 ~0 ~(0) (0.3) ~(0) 0 1 2 3 22 Q1 2019 Downstream results Earnings on CCS basis, excluding identified items. Individual categories presented excluding IFRS 16 impact; IFRS 16 impact on individual categories: Refining & Trading margins +$0.08bln, Cost +$0.22bln, DD&A -$0.26bln. $ billion Earnings Q1 2018 to Q1 2019 $ billion Earnings mix 0 5 10 2016 2017 2018 Q1 2019 4Q rolling Marketing Refining & Trading Chemicals
  23. 23. Royal Dutch Shell May 2, 2019 23 IFRS 16 Impact on financial metrics Outlook for 2019 Key metrics change, no business or value impact Gearing Operating expenses Segment earnings Free cash flow ~4%-5% increase ◼ Full impact recognised in Q1 2019, in line with guidance provided ~$2-3 billion decrease ◼ Q1 2019 impact lower than outlook ◼ Full year impact expected at the lower end of the range provided ~$1 billion impact ~$4 billion increase ◼ CFFO increase of $0.9 billion ◼ CFFI increase of $0.1 billion ◼ Fully offset by CFFF decrease Outlook for 2019 as provided during the IFRS 16 update call on March 28, 2019. 4.6% increase $0.4 billion decrease $0.2 billion impact $1.1 billion increase Q1 2019 impact ◼ Business segments: $140 million ◼ Corporate: $(183) million ◼ Net impact: $(43) million Capital investment Clean CCS ROACE ~$1-2 billion increase ~0.5% decrease ◼ Partial impact recognized in Q1 2019 (higher closing capital employed, partly offset by one quarter of increased interest expense after tax) $0.7 billion increase 0.2% decrease ◼ Q1 2019 impact due to finance leases capitalised in the quarter ◼ Full year outlook unchanged
  24. 24. Royal Dutch Shell May 2, 2019 24 Projects under construction [A] Direct and indirect share. [B] The Brazil accumulations are subject to unitisation agreements; production shown is FPSO oil capacity as per operator. [C] Fox Creek and Permian production represents Shell entitlement share of production and is the peak production expected between 2017 and 2019. [D] Sierras Blancas and Cruz de Lorena at 90% Shell share, Coiron Amargo SO at 80% Shell share. 2019 Shell share: ▪ >300 kboe/d 2020+ Shell share: ▪ >350 kboe/d ▪ 5.6 mtpa LNG ▪ 1.5 mtpa ethylene Start up Project Country Shell share [A] % Peak Production 100% kboe/d LNG capacity 100% mtpa Products Theme Shell operated 2019 Appomattox United States 79 175  Deep water P Berbigão and Sururu SW (P-68) [B] Brazil 25 150  Deep water Forcados Yokri Integrated Project (FYIP) Nigeria 30 40  Conventional oil and gas P Gumusut-Kakap Ph2 Malaysia 29 50  Deep water P Permian + Fox Creek [C] United States & Canada various ~250  Shales P Rabab Harweel Integrated Project Oman 34 35  Conventional oil and gas Southern Swamp AG Nigeria 30 40  Conventional oil and gas P Tempa Rossa Italy 25 50  Conventional oil and gas WDDM 9B Egypt 50 52  Conventional oil and gas 2020+ Arran United Kingdom 45 30  Conventional oil and gas Assa North Nigeria 30 60  Conventional oil and gas P Atapu 1 (P-70) [B] Brazil 25 150  Deep water TBD (P71) [B] Brazil 25 150  Deep water Bakong / Gorek / Larak (SK408) Malaysia 30 75  Conventional oil and gas P EA Further Development Nigeria 30 35  Conventional oil and gas Gorgon backfill PhB1 Australia 25 maintain capacity  Integrated Gas KBB Phase 2 Malaysia 30 60  Conventional oil and gas LNG Canada T1-2 Canada 40 14  Integrated Gas Mero 1 [B] Brazil 20 180  Deep water Pegaga Malaysia 20 95  Conventional oil and gas Penguins Redevelopment United Kingdom 50 45  Conventional oil and gas P Pennsylvania cracker United States 100 1.5 mtpa C2  Chemicals P Troll Ph3 Norway 8 255  Conventional oil and gas Tyra Future Denmark 37 80  Conventional oil and gas Vaca Muerta basin [D] Argentina ~90 ~70  Shales P Vito United States 63 100  Deep water P
  25. 25. Royal Dutch Shell May 2, 2019 25 Pre-FID options [A] Direct and indirect share. Shell share potential: ▪ ~1,000 kboe/d ▪ >24 mtpa LNG Phase Project Country Shell share [A] % Peak Production 100% kboe/d LNG capacity 100% mtpa Products Theme Shell operated Define Bonga South West Nigeria 43 175  Deep water P Gbaran Ph3 Nigeria 30 50  Conventional oil and gas P Lake Charles LNG United States 50 16.8  Integrated Gas P NLNG T7 Nigeria 26 7.4  Integrated Gas Pierce Depressurisation United Kingdom 93 20  Conventional oil and gas P Powernap United States 100 35  Deep water P Prelude backfill Australia 82 maintain capacity  Integrated Gas P Salym Southern Hub Russia 50 65  Conventional oil and gas Uzu Development Nigeria 30 45  Conventional oil and gas P Val d’Agri Future Development Italy 39 65  Conventional oil and gas Assess/ Select Abadi Indonesia 35 244 9.5  Integrated Gas Afungi Mozambique 70 1.6 mtpa GTL  Integrated Gas P Bonga Main Life Extension & Upgrade Nigeria 55 80  Deep water P Bonga North Tranche 1 Nigeria 55 119  Deep water P Browse Australia 27 TBD  Integrated Gas Bukom upgrade Singapore 100 Gasoline  Oil Products P Cambo United Kingdom 30 40  Conventional oil and gas Clair South United Kingdom 28 60  Conventional oil and gas Colibri Trinidad & Tobago 87 35  Integrated Gas P Dover United States 100 TBD  Deep water P Gato do Mato Brazil 80 99  Deep water P Gorgon backfill PhB2 Australia 25 maintain capacity  Integrated Gas Gorgon backfill PhB3/PhC1/PhC2 Australia 25 maintain capacity  Integrated Gas (continues) Oman Integrated GTL Oman TBD TBD TBD  Integrated Gas P
  26. 26. Royal Dutch Shell May 2, 2019 26 Pre-FID options [A] Direct and indirect share. [B] The Brazil accumulations are subject to unitisation agreements; production shown is FPSO oil capacity as per operator. Shell share potential: ▪ ~1,000 kboe/d ▪ >24 mtpa LNG Phase Project Country Shell share [A] % Peak Production 100% kboe/d LNG capacity 100% mtpa Products Theme Shell operated Assess/ Select (continued) HA Development Nigeria 30 60  Conventional oil and gas P HI Development Nigeria 40 75  Conventional oil and gas P Jackdaw United Kingdom 74 40  Conventional oil and gas P Jerun Malaysia 30 95  Conventional oil and gas Kalamkas Kazakhstan 17 55  Conventional oil and gas Kashagan CFP Kazakhstan 17 65  Conventional oil and gas KGK Expansion Ph1 Kazakhstan 29 40  Conventional oil and gas LNG Canada T3-4 Canada 40 14  Integrated Gas Marjoram/Rosmari Malaysia 75 100  Conventional oil and gas P Mero 2[B] Brazil 20 180  Deep water Mero 3[B] Brazil 20 180  Deep water Mero 4[B] Brazil 20 180  Deep water Moerdijk NWE efficiency project The Netherlands 100 Ethylene  Chemicals P Nebras Iraq TBD TBD  Chemicals TBD Norco upgrade United States 100 Gasoline  Oil Products P Okpokunou Cluster Development Nigeria 24 85  Conventional oil and gas P Ormen Lange Phase 3 Norway 18 80  Conventional oil and gas P Pearls Khazar Kazakhstan 55 40  Conventional oil and gas QGC backfill (Arrow) Australia 50 maintain capacity  Integrated Gas Sakhalin T3 Russia 28 5.4  Integrated Gas Tanzania Tanzania 30 TBD 12  Integrated Gas P Timi Malaysia 75 40  Conventional oil and gas Whale United States 60 TBD  Deep water P
  27. 27. Royal Dutch Shell May 2, 2019

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