1. Art and Diseño

FOURTH QUARTER 2014 RESULTS
BALANCING GROWTH & RETURNS
29 JANUARY 2015
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
1
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 forwardlooking 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 forwardlooking 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.
Copyright of Royal Dutch Shell plc
29 January, 2015
2
BEN VAN BEURDEN
CHIEF EXECUTIVE OFFICER
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
3
FOCUS ON HSSE
2014 UPDATE
Goal Zero on safety
Spills - operational
Injuries – TRCF/million working hours
TRCF
million working hours
Volume in thousand tonnes
Working hours (RHS)
Energy intensity – refineries
Process safety
Energy Intensity Index (EEITM)
Number of incidents
„
HSSE priority
„
Performance + transparency
Tier 1 incidents
Tier 2 incidents
Injuries – TRCF/million working hours
Copyright of Royal Dutch Shell plc
29 January, 2015
4
EXECUTING A CONSISTENT, LONG-TERM STRATEGY
„
Unrelenting focus on HSSE
Total shareholder returns growth – 10 years
Index 1/1/2005 =100
„
Technology, integration and scale
„
Disciplined capital investment by strategic theme
„
Growth in cash flow through cycle
„
Competitive shareholder returns
„
2014+ drive to rebalance growth and returns
Shell
Copyright of Royal Dutch Shell plc
29 January, 2015
S&P500
FTSE100
5
ENERGY TRANSITIONS
Long-term energy supply mix
2050 outlook
Million boe per day
+50%
„
Population increases from 7 to 9 billion
„
Enabled by cheap and reliable energy
Realities
+50%
Shell activities
„
Gas
Oil
Biomass
Wind
„
Requirement to mitigate climate change
„
Oil supply -70% by 2030 without new investment
„
Key role of gas & CCS
Coal
Nuclear
Other renewables
Solar
Energy transitions underway
Copyright of Royal Dutch Shell plc
29 January, 2015
6
OIL MARKET + SHELL RESPONSE
Oil supply
Oil market downturn
Million barrels of oil per day
„
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
Source: IEA estimates
Copyright of Royal Dutch Shell plc
29 January, 2015
7
FINANCIAL PERFORMANCE
2014 DELIVERY
Earnings + ROACE
Cash flow
%
$ billion
Upstream
Downstream
$ billion
Corporate/Other
$ billion
CFFO
CFFI
Free cash flow (RHS)
ROACE (RHS)
Dividend, buyback + gearing
$ billion
Gearing %
range
Dividend announced
Gearing (RHS)
„
Well-positioned into oil market downturn
„
Asset sales delivered ahead of oil price
decline
„
Enhanced free cash flow + lower gearing
Buyback
CCS earnings + ROACE excluding identified items
Copyright of Royal Dutch Shell plc
29 January, 2015
8
2014 DELIVERY
BALANCING GROWTH AND RETURNS
Improve our financial performance
„
„
„
CCS earnings $22.6 billion; CFFO $45.0 billion
Dividend growth + buyback
Restructuring in Oil Products + North America
resources plays
Enhance our capital efficiency
„
„
„
Moderated spending + growth
Improved free cash flow; reduced gearing
Early completion of 14-15 divestment plan
Deliver new projects
„
„
„
4 operated deep-water start-ups
Repsol LNG integration: >$1 billion CFFO impact
New options in FEED; improved exploration
CCS earnings excluding identified items
Copyright of Royal Dutch Shell plc
29 January, 2015
9
CHANGING EMPHASIS IN 2014+
SHARPER PORTFOLIO MANAGEMENT + APPRAISAL
More rigorous portfolio management
Taking hard choices on funnel
RESILIENCE
STRATEGIC
INTENT
Risk, performance
&
uncertainty
FEED
ASPIRED
PORTFOLIO
ATTRACTIVENESS
RESULTS
& PAYOUT
Identify&Assess
Select
FID
Define
On-stream
Execute
Operate
Growth & returns
Opportunity scale
~140 performance units add focus
Attractiveness
Grow
„
Increased shareholding requirements for
management
„
Bottom line focus
„
Credible, competitive + affordable plans
Fix/maintain
Exit
Resilience
Copyright of Royal Dutch Shell plc
29 January, 2015
10
PRIORITIES 2015+
Competitive financial
performance
Capital efficiency
„
Returns and cash flow
„
Choices on new options
„
Competitive returns for
shareholders
„
Supply chain management
„
„
„
Managing affordability +
financial flexibility
„
Preserving our competitive
growth pipeline in downturn
Restructuring underperforming
businesses
Cost reduction programmes
Copyright of Royal Dutch Shell plc
29 January, 2015
Project delivery
„
Continued ramp-up of 2014
start-ups
„
2015 transition year into
2016/17+ growth
11
COMPETITIVE FINANCIAL PERFORMANCE
PORTFOLIO RESTRUCTURING
Resources plays
Oil Products
Upstream engine
Capital investment in $ billion
$ billion
$ billion
kboe per day (Shell share)
-30%
LRS
Dry gas
Acquisitions
CFFO
Capital investment
Asset sales (incl. MLP)
Production (RHS)
„
NA portfolio reduction completed
„
Optimise footprint
„
Strong ROACE, 27% 2014
„
2015+ reduction of International
portfolio
„
Integrated value capture
„
Free cash flow reduction:
„
Selective investment in growth
markets
„
Capital ceiling + cost reduction
„
Copyright of Royal Dutch Shell plc
29 January, 2015
Capital discipline and project
delivery
„
Investment-heavy phase
„
Cost and profitability pressures
„
Late-life asset challenges
12
COMPETITIVE FINANCIAL PERFORMANCE
RESTRUCTURING RESOURCES PLAYS PORTFOLIO
W. Canada gas
Russia
Germany
Ukraine
`
Appalachia
Changbei
Turkey
Tunisia
W. Canada LRS
Algeria
Oman
Changbei 2
Sichuan
Colombia
Permian
Arrow CBM
Argentina
Neuquen
Gas
Liquids Rich
On-stream
E&A
„
„
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
Production
Capital investment
kboe per day
$ billion
Liquids
Gas
-30%
Americas
International
Production excludes volumes from divestments
Copyright of Royal Dutch Shell plc
29 January, 2015
13
COMPETITIVE FINANCIAL PERFORMANCE
DOWNSTREAM ENGINE
Cash flow + ROACE
Earnings 2013 to 2014
$ billion
%
Cash flow
$ billion
ROACE (RHS)
Operating performance
% unplanned downtime
Refining
Chemicals
„
Self-help + improved joint venture
performance
„
Launched new cost drive at end 2014
„
10-12% ROACE + $10 billion p.a. CFFO
potential
CCS earnings excluding identified items
Copyright of Royal Dutch Shell plc
29 January, 2015
14
COMPETITIVE FINANCIAL PERFORMANCE
PORTFOLIO RESTRUCTURING: OIL PRODUCTS
Portfolio change
Refining capacity
Million b/d
# of refineries
Selective Growth:
„ China
„ LNG for transport
„ Premium fuels + lubes
„ Refinery crude flexibility
„ others
~ -20%
Attractiveness
Fix:
„ Motiva
„ Singapore fuels
„ Pernis + Rheinland
„ Malaysia
„ Moerdijk
„ others
Europe
Asia, Oceania, Africa
Americas
Refineries (RHS)
Exit:
„
„
„
„
„
Italy 9
Australia 9
Norway
Denmark
others
9 completed
„
2014 asset sales + MLP: >$4 billion
„
Ongoing divestments
„
Efficiency + cost drive
Resilience
Equity refinery positions
Copyright of Royal Dutch Shell plc
29 January, 2015
15
COMPETITIVE FINANCIAL PERFORMANCE
PORTFOLIO RESTRUCTURING: UPSTREAM ENGINE
Managed decline of legacy positions
Upstream engine portfolio
kboe per day (Shell share)
Selective growth:
„ Schiehallion
„ Clair Ph2
„ Val d’ Agri ph2 ~95
„ Tempa Rossa
kboe/d*
„ Beryl
„ Corrib
Attractiveness
Maintain
„ Norway
„ NAM
„ Malaysia
„ Oman
„ New Zealand
„ Philippines
Exit / Dilute /
Decommissioning:
„ Nelson
„ Anasuria
14 kboe/d
„ Sean
„ Brent decommissioning
„ others
Netherlands
Oman
Fix
„ Denmark
„ Brunei
„ Gabon onshore
Resilience
„
„
Malaysia
Norway
Brunei
UK
Abu Dhabi
Others
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
* 2018/19 potential, Shell share
Copyright of Royal Dutch Shell plc
29 January, 2015
16
INVESTMENT PRIORITIES + PERFORMANCE
Engines (Downstream, Upstream engine)
„
Free cash flow businesses
„
Maintain competitiveness
„
Asset integrity + selective growth
CFFO in billion $
Integrated gas
Downstream
engine
Growth priority (Integrated Gas, deep water)
„
Global leadership established
„
High-grading our rich opportunity set
Upstream engine
Deep water
Resources plays
Future opportunities
Longer term (resources plays, future opportunities1)
„
Major potential; managing non-technical risks
„
Slower pace + capital allocation
ROACE (%)
Bubble size represents
year-end capital employed
„
„
1 Iraq,
2014
(Brent $99/bbl)
2013
(Brent $109/bbl)
Investment choices driven on a global thematic basis
Assets tested for attractiveness + resilience
Nigeria onshore (SPDC), Kazakhstan, Arctic, heavy oil
Copyright of Royal Dutch Shell plc
29 January, 2015
17
COMPETITIVE, CREDIBLE + AFFORDABLE PLANS
MODERATING OUR SPENDING + GROWTH OUTLOOK
$ billion total capital investment
$ billion organic capital investment
> -15%
2015
potential
„
Project re-phasing / deferral
„
Supply chain savings
„
Dilutions + exits
2015
plan
Upstream
Downstream / Corporate
Acquisitions
„
2015 organic spending lower than 2014
„
Retaining options for medium term
„
Flexibility to reduce further
2014 acquisitions: Repsol LNG
Copyright of Royal Dutch Shell plc
29 January, 2015
18
SIMON HENRY
CHIEF FINANCIAL OFFICER
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
19
FINANCIAL PERFORMANCE
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
20
2014 FINANCIAL HIGHLIGHTS
Earnings 2013 to 2014
$ billion
2013
2014
$ billion
UPSTREAM
DOWNSTREAM (CCS)
15.1
4.5
16.5
6.3
CORPORATE & MINORITIES
(0.1)
(0.2)
CCS NET EARNINGS
19.5
22.6
CCS EARNINGS, $ PER SHARE
3.10
3.57
CASH FROM OPERATIONS
40.4
45.0
ROACE (%)
8.9
10.2
SHARE BUYBACKS
5.0
3.3
DIVIDENDS
11.3
11.9
DIVIDEND, $ PER SHARE
1.80
1.88
Environment
Choice
Earnings and ROACE on CCS basis, excluding identified items
Copyright of Royal Dutch Shell plc
29 January, 2015
21
PRELIMINARY RESULTS
SEC PROVED RESERVES POSITION
2014 Reserves performance
2012-14 Reserves additions
„
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%
Major reserves additions
Reserves Replacement
1
2
SEC proved reserves
2012-14
2014
(billion boe)
2012
2013
2014
Organic
85%
47%
Organic reserves additions
1.0
1.5
0.5
Organic incl. price effects
76%
50%
Production
1.2
1.2
1.2
SEC proved reserves2
67%
26%
SEC proved reserves2
13.6
13.9
13.1
Excludes acquisitions, divestments and price impacts
Reserves attributable to Royal Dutch Shell shareholders
Copyright of Royal Dutch Shell plc
29 January, 2015
22
OIL + GAS RESOURCES FUNNEL
Converting resources to production…
Billion boe
Longer-term upside
Appomattox
Browse
resources plays
Val d’Agri ph2
Vito
others
Baronia EOR /
Tukau Timur
Bonga Main ph3
Coulomb ph2
Bonga North West
Cardamom
Gumusut-Kakap
Mars B
Petai
Sabah gas KBB
2010
2011
2012
2013
On-stream
Select/Define
Execute (under construction)
Production
Copyright of Royal Dutch Shell plc
29 January, 2015
„
Asset sales + capital ceiling
„
Fewer FIDs in 2014
„
Maintaining attractive project
flow
2014
23
CONVENTIONAL EXPLORATION
EXECUTING A CONSISTENT AND SUCCESSFUL EXPLORATION STRATEGY
Time to
Prospect
development
size
(years)
2015 spend
(million boe)
ARCTIC
Long-term potential for
industry
15+
>500
FRONTIER
Build-up of acreage in
under-explored basins
10+
>250
HEARTLANDS
New plays in Shell
producing basins
3+
50-250
NFE
Heartlands / Libra
Frontier / Arctic
NEAR-FIELD
„
High-value add-ons
<3
5-50
Low-cost access to new barrels: balancing exploration risk and returns
Spend includes acquisitions
Copyright of Royal Dutch Shell plc
29 January, 2015
24
EXPLORATION: 2014 PERFORMANCE
„
GOM deep-water heartlands
„ 2014: Rydberg, Kaikias, Power Nap
+ Gettysburg discoveries
„ >1300 mmboe for Shell 2009+
Improved delivery in 2014
„
10 frontier + heartlands successes
„
41 near-field finds
Gabon deep-water frontier
„ Sub-salt deep-water gas
discovery
„ Shell 75%, operator
Malaysia heartlands
„ NFE success, 3
heartland discoveries,
1 successful appraisal
„ ~300 mmboe for Shell
in 2014
Frontier basin
2014 drilling success
Frontier
Brazil - Libra
„ NW1 successful appraisal
„ C-1 well drilling
„ Shell 20%
Australia heartlands
„ 2014: Lympstone discovery
„ NFE success
Heartlands
Near-field
Copyright of Royal Dutch Shell plc
29 January, 2015
25
CAPITAL EFFICIENCY
FINANCIAL FRAMEWORK AND PRIORITIES
Priorities for cash
Cash performance
$ billion
1. Debt service
2. Dividends: growth policy
3. Capital investment: disciplined
through-cycle growth
CFFO
4. Return surplus cash: buybacks
Pay-out
Investment
$ billion
$ billion
Cash dividend
Buyback
CFFI
Balance sheet
$ billion
„
Balancing cash in / cash out
across cycle
„
Maintaining strong balance
sheet
%
Net debt
Copyright of Royal Dutch Shell plc
29 January, 2015
Gearing
26
CONSISTENT DELIVERY OF COST REDUCTION PROGRAMMES
MULTI-BILLION $ OPPORTUNITY IN SHELL + SUPPLY CHAIN
North America resources plays
Supply chain
$ million 2014 savings (opex + capex)
Short term
Medium term
Price
Contract renegotiations
Design
Design to cost/Design to value
Demand
Use of EFAs/location choice
Strategic
long term
>15%
savings
Drilling, projects and operating costs excludes portfolio effects
Supply chain
„
Low-cost countries + global suppliers
„
Standardisation
Overheads
„
Right-sizing with asset sales
„
Offshoring + efficiency drive
Copyright of Royal Dutch Shell plc
29 January, 2015
„
Multi-billion dollar reduction in supply chain
„
Operating cost reduction 2014-15
27
CAPITAL EFFICIENCY
EARLY DELIVERY OF 2014-15 $15 BILLION DIVESTMENT PLAN
Asset sales add focus
$ billion
Divestment/exit
Early delivery
of 2014-15
target
2014
Woodside 9.5%
Wheatstone LNG
Australia downstream
Italy downstream
Australia upstream
refocus
Monetise non-core
Oil Products
US midstream MLP
NA non-core LRS
Pinedale + Haynesville dry gas
Resources plays
reduction
BC-10 dilution
Asset sales + MLP proceeds
ADCO license expiry
Nigeria onshore
ongoing footprint reduction
315 kboe/d oil + gas
„
$5-6 billion p.a. ongoing divestment
~120,000 b/d refining capacity
„
2015 divestments likely lower pace
240,000 b/d marketing
0.6 mtpa LNG
Copyright of Royal Dutch Shell plc
29 January, 2015
28
PORTFOLIO CHOICES DRIVING PROFITABILITY
Production
Upstream CFFO*
million boe per day
$ billion
+25%
Underlying +2%
* CFFO excludes working capital + oil & gas price effects
„
Copyright of Royal Dutch Shell plc
29 January, 2015
Enhancing profitability
29
CAPITAL EFFICIENCY
INVESTMENT PRIORITIES
Investment themes
Organic capital investment
Conventional
exploration
Pre-FID large
project options
Longer term: 25%
Post-FID large
projects
Growth priorities: 40%
10%
50%
Short-cycle
projects1
Engines: 35%
2015
organic capital
investment
Base
40%
2015
organic capital
investment
CFFO impact
of 2015 investment
‘19+
’17-’18
’15-’16
„
Growth priorities unchanged
„
Driving competitive cash flow
1 Resources
Copyright of Royal Dutch Shell plc
29 January, 2015
plays, Majnoon, infill drilling
30
CASH PERFORMANCE + PAY-OUT
Cash flow
$ billion
Dividend track record
2012-2014
$ billion
2014
Cash flow from operations
Cash flow from investments1
Dividends announced
Pay-out
1 Includes
MLP proceeds
Gearing and pay-out
%
$ billion
Dividend
Free cash flow
Buybacks
Gearing (RHS)
„
2014 dividend and buyback $15 billion
„
2015 dividend ~$12 billion
„
Buybacks in 2015 subject to oil prices
„
Gearing likely to increase in 2015
Dividend is dividend announced
Copyright of Royal Dutch Shell plc
29 January, 2015
31
BEN VAN BEURDEN
CHIEF EXECUTIVE OFFICER
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
32
PROJECT DELIVERY
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
33
PROJECTS UNDER CONSTRUCTION
Production
kboe per day (Shell share)
million tonnes per annum
Shell-operated
3 started up
2014
„
Mars B 3
„
Gumusut-Kakap 3
„
Bonga NW 3
„
Petai 3
„
Cardamom 3
„
Sabah gas KBB 3
2015-16
„
2014 start-ups
2015-16 start-ups
2017-19 start-ups
LNG volume (RHS)
>700 kboe/d + 7.5 mtpa LNG under
construction
2017-19
„
BC-10 ph3
„
Baronia /Tukau Timur
„
Bonga Main ph3
„
Carmon Creek
„
Corrib
„
Clair ph2
„
Erha North ph2
„
Coulomb
„
Forcados Yokri
„
Kashagan ph1
„
Gbaran-Ubie ph2
„
Malikai
„
Gorgon LNG
„
MMLS LNG (Elba)
„
ML South
„
Prelude FLNG
„
NA LRS/tight gas
„
Rabab Harweel
„
Stones
„
Schiehallion
„
High-margin production
„
Southern Swamp
„
Growth uptick 2017+
„
Tempa Rossa
„
TNP loopline
Copyright of Royal Dutch Shell plc
29 January, 2015
34
PROJECT DELIVERY
MANAGING OUR OPPORTUNITY SET
2015-16 FID options
17 potential FIDs 2015-16
Options deferred /
cancelled
FID choices
2015-16
Carmon Creek ph3+4
postponed
Majnoon full field
> 700 kboe/d
~12 mtpa LNG
2.7 mtpa chemicals
FUTURE
OPPORTUNITIES
World-wide restructuring Canada, Lower 48,
Argentina, other
RESOURCES
PLAYS
Deferral of FIDs
Slower pace in Nigeria
DEEP WATER
INTEGRATED
GAS
Appomattox
Vito
Bonga South West
Libra pilot FPSO vessel
Asia Pacific slow-down
Arrow LNG greenfield
cancelled
Elba LNG (site)
LNG Canada T1+2
Browse LNG
Selected base projects
Val d’Agri ph2
Bokor
UPSTREAM
ENGINE
DOWNSTREAM
ENGINE
Al Karaana chemicals
cancelled
Selected base projects
Copyright of Royal Dutch Shell plc
Pennsylvania chem.
Geismar alpha olefins
China chemicals
Debottleneck projects
29 January, 2015
Upstream
Downstream
„
>$15 billion spending mitigation planned
2015-17:
„
Re-phasing / deferral
„
Supply chain
„
Dilutions + exits
35
COMPETITIVE PERFORMANCE: BALANCING GROWTH AND RETURNS
Cash flow from operations
Free cash flow
$ billion
$ billion
Shell
Peer group
ROACE – underlying
Total shareholder return (2012-2014)
%
%
Shell
competitors
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
Copyright of Royal Dutch Shell plc
29 January, 2015
36
PRIORITIES 2015+
Competitive financial
performance
Capital efficiency
„
Returns and cash flow
„
Choices on new options
„
Competitive returns for
shareholders
„
Supply chain management
„
„
„
Managing affordability +
financial flexibility
„
Preserving our competitive
growth pipeline in downturn
Restructuring underperforming
businesses
Cost reduction programmes
Copyright of Royal Dutch Shell plc
29 January, 2015
Project delivery
„
Continued ramp-up of 2014
start-ups
„
2015 transition year into
2016/17+ growth
37
QUESTIONS & ANSWERS
FOURTH QUARTER 2014 RESULTS
Copyright of Royal Dutch Shell plc
29 January, 2015
38
FOURTH QUARTER 2014 RESULTS
BALANCING GROWTH & RETURNS
29 JANUARY 2015
ROYAL DUTCH SHELL PLC
Copyright of Royal Dutch Shell plc
29 January, 2015
39