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Socially Responsible Investor Briefing – Shell

Shell · Apr 14, 2015 · 47 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Socially Responsible Investor Briefing – Shell – slide 1
    ANNUAL ROUNDTABLE FOR SOCIALLY RESPONSIBLE INVESTORS 14 APRIL 2015 ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 1
  2. Socially Responsible Investor Briefing – Shell – slide 2
    ANNUAL ROUNDTABLE FOR SOCIALLY RESPONSIBLE INVESTORS BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 3
  3. Socially Responsible Investor Briefing – Shell – slide 3
    ENVIRONMENTAL, SOCIAL AND GOVERNANCE SRI programme SRI annual roundtable Ongoing engagement + roadshows Learning events hydraulic fracturing and CCS in 2014 Governance programme Remuneration committee roadshows Chairman…
  4. Socially Responsible Investor Briefing – Shell – slide 4
    SHELL APPROACH TO SUSTAINABILITY Helping to shape a more sustainable energy future Sharing wider benefits where we operate Running a safe, efficient, responsible and profitable business www.shell.com/sustainability…
  5. Socially Responsible Investor Briefing – Shell – slide 5
    AGENDA 13:00 13:45 Ben van Beurden and Chad Holliday 13:45 14:00 Climate change: Harry Brekelmans and Angus Gillespie 14:00 14:45 Q+A 14:45 15:10 Coffee break 15:15 17:30 Panel sessions Q&A (40 min each, 5 minutes to rotate):…
  6. Socially Responsible Investor Briefing – Shell – slide 6
    PANELS Panel A: North America and Alaska update: Marvin Odum (Director Upstream Americas) and Ann Pickard (EVP Arctic). Panel B: Upstream International Operated assets and Nigeria: Bart van der Leemput (EVP Upstream…
  7. Socially Responsible Investor Briefing – Shell – slide 7
    TRANSPARENCY Sustainability reporting 1997 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Revenue transparency Nigeria spills website Oil sands performance report Nigeria briefing notes CDP Sustainability report…
  8. Socially Responsible Investor Briefing – Shell – slide 8
    SHAREHOLDER RESOLUTION: CLIMATE CHANGE DISCLOSURE RESOLUTION INFORMATION REQUEST 2013 2014 2015 Ongoing emissions management Asset portfolio resilience to post-2035 scenarios Low-carbon R&D and investment strategies…
  9. Socially Responsible Investor Briefing – Shell – slide 9
    ANNUAL ROUNDTABLE FOR SOCIALLY RESPONSIBLE INVESTORS CHAD HOLLIDAY NON-EXECUTIVE DIRECTOR AND CHAIR OF THE CORPORATE AND SOCIAL RESPONSIBILITY COMMITTEE ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 10
  10. Socially Responsible Investor Briefing – Shell – slide 10
    CORPORATE AND SOCIAL RESPONSIBILITY COMMITTEE CSRC MEMBERS CHARLES HOLLIDAY SIR NIGEL SHEINWALD PATRICIA WOERTZ GERRIT ZALM Chair of CSRC Responsibilities: Review policy and performance for Shell General Business Principles and…
  11. Socially Responsible Investor Briefing – Shell – slide 11
    SITE VISITS 2014 Activity 2015 Plans Western Canada Brazil biofuels Onshore oil and gas GoM operations Oil sands operations Separate visits: Canada LNG potential Moerdijk, Appalachian tight gas, Peterhead Kitimat Tight gas,…
  12. Socially Responsible Investor Briefing – Shell – slide 12
    STRATEGIC KPIS AND EXECUTIVE INCENTIVES 2015 EXECUTIVE BONUS STRUCTURE 30% weight 50% weight CFFO Operational Excellence 20% weight Sustainable Development 10% weight 10% weight Safety Sustainability 5% weight 5%…
  13. Socially Responsible Investor Briefing – Shell – slide 13
    PARTNERSHIPS + ENGAGEMENT Leverage outside expertise Scientific organizations NGOs Governmental bodies Long-term partnerships Strengthened governance Wetlands International IUCN The Nature Conservancy EarthWatch Institute…
  14. Socially Responsible Investor Briefing – Shell – slide 14
    WORKING WITH OTHERS Shell Foundation Center for Sustainable Shale Development 250 million endowment from Shell 3rd party certification Independent charity to support economic Collaboration with environmental organizations…
  15. Socially Responsible Investor Briefing – Shell – slide 15
    ANNUAL ROUNDTABLE FOR SOCIALLY RESPONSIBLE INVESTORS BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 16
  16. Socially Responsible Investor Briefing – Shell – slide 16
    ENERGY TRANSITIONS Long-term energy supply mix 2050 outlook Million boe per day 400 Population increases from 7 to 9 billion +50% Enabled by cheap and reliable energy 300 +50% Realities 200 Requirement to mitigate climate change…
  17. Socially Responsible Investor Briefing – Shell – slide 17
    STRATEGY AND INVESTMENT PRIORITIES Grow cash flow + deliver competitive returns Competitive financial Capital efficiency Project delivery performance Capital allocation by global themes ENGINES: GROWTH PRIORITIES: LONGER…
  18. Socially Responsible Investor Briefing – Shell – slide 18
    INVESTMENT PRIORITIES 100% Conventional 100% exploration 10% Pre-FID large Longer term: 25% project options 50% Post-FID large projects 50% 50% Growth priorities: 40% Short-cycle projects1 40% Base Engines: 35% 0% 0%…
  19. Socially Responsible Investor Briefing – Shell – slide 19
    HSSE + STRATEGY Strategy: balancing growth and returns Competitive financial Capital efficiency Project delivery performance Health, safety, security and environment key to delivery of strategy Goal Zero Opportunity…
  20. Socially Responsible Investor Briefing – Shell – slide 20
    SUSTAINABILITY IN PROJECT LIFE CYCLE Explore Feasibility study FEED FID On stream Ceased production Decommission Identify & Assess Select Define Execute Operate & restore Sustainability objectives Environmental, social &…
  21. Socially Responsible Investor Briefing – Shell – slide 21
    2014 SAFETY PERFORMANCE Goal Zero on safety Spills - operational Injuries TRCF/million working hours million working hours Volume in thousand tonnes 10 4 800 5 2 600 0 400 0 '04 '06 '08 '10 '12 '14 '04 '06 '08 '10 '12 14 TRCF…
  22. Socially Responsible Investor Briefing – Shell – slide 22
    CONTRACTOR SAFETY + MANAGEMENT Assessment Evaluation Contract Management Green Technical Monitor performance and delivery including Amber HSSE gap closures agreed in the HSSE plan Red Commercial Goal Zero Contractors…
  23. Socially Responsible Investor Briefing – Shell – slide 23
    ONGOING EMISSIONS MANAGEMENT Energy intensity Emissions Gj/tonne (energy required to produce a tonne of oil equivalent) index Million tonnes CO2 equivalent 1 105 100 80 100 60 0.5 95 40 90 20 0 85 0 '05 '06 '07 '08 '09 '10 '11…
  24. Socially Responsible Investor Briefing – Shell – slide 24
    WATER MANAGEMENT Water regulation evolving rapidly Centre of Excellence in Bangalore: Water management plans Integrated project delivery water scarce areas Technical support future water scarce areas Water R&D Shell fresh water…
  25. Socially Responsible Investor Briefing – Shell – slide 25
    REDUCING ONSHORE NIGERIA FOOTPRINT Restructuring onshore footprint Nigeria onshore portfolio 2010 2015 divested 11 OMLs OML4 OML40 OML38 Legend OML41 Concessions SPDC Legal Targeted investments: gas and Divested Concessions Major…
  26. Socially Responsible Investor Briefing – Shell – slide 26
    NIGERIA: SPDC JOINT VENTURE PERFORMANCE 2014 overview Widespread oil theft remains a challenge 0 fatalities, 19 kidnappings Illegal fitting on NCTL at Opomakri, January 2015 SPDC* spills Production Thousand tonnes k boe/day…
  27. Socially Responsible Investor Briefing – Shell – slide 27
    ALASKA UPDATE 2015 Chukchi Sea 2 rig programme 28 support vessels Pending Exploration Plan approval & drilling permits 2012 learnings + actions Transocean Polar Pioneer Upgraded contractor management Certified Arctic Containment…
  28. Socially Responsible Investor Briefing – Shell – slide 28
    CANADA UPDATE LNG Canada Quest Carbon Capture and Storage 13 mtpa in FEED (100% capacity) Targets oil sands emissions Community advisory group Expected start up 2015 First Nations visit Oman LNG 2014 1mtpa CO2 Environmental…
  29. Socially Responsible Investor Briefing – Shell – slide 29
    CLIMATE CHANGE PUBLIC POLICY POSITION Pro-active advocacy A robust price on carbon Government support for early stage low carbon technologies Explore plausible futures in Shell scenarios Work with governments on energy transitions…
  30. Socially Responsible Investor Briefing – Shell – slide 30
    CLIMATE CHANGE + LOW CARBON ACTIVITY Gas Energy Efficiency Biofuels Carbon Capture & Storage Copyright of Royal Dutch Shell plc 14 April, 2015 31
  31. Socially Responsible Investor Briefing – Shell – slide 31
    CLIMATE CHANGE HARRY BREKELMANS DIRECTOR PROJECTS AND TECHNOLOGY ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 32
  32. Socially Responsible Investor Briefing – Shell – slide 32
    PROJECTS AND TECHNOLOGY AT SHELL Field development planning Projects and Technology in numbers: Project execution 14,000 staff Technical Services 323 patent applications Research & Development 1.2 billion R&D spend in 2014 Safety &…
  33. Socially Responsible Investor Briefing – Shell – slide 33
    SHELL ENERGY SCENARIOS Energy demand by source Exajoules 1,000 750 500 250 40 years of scenarios Designed to stretch management 0 2000 2030 2060 thinking Testing business models Oil Coal Gas Nuclear Contrasting…
  34. Socially Responsible Investor Briefing – Shell – slide 34
    ENERGY-RELATED CARBON EMISSIONS: SCENARIOS Shell and IEA scenarios 1 Life-cycle CO2 intensity of electricity generation GtCO2/year CO2 equivalent/ KWh2 50 1000 40 30 500 20 10 0 0 2000 2020 2040 2060 2080 2100 Oceans…
  35. Socially Responsible Investor Briefing – Shell – slide 35
    ENERGY TRANSITIONS Shift to lower carbon energy system Example: Germany electricity consumption (by source) EJ/Year Dynamic, policy-driven changes 2.5 Local and global trends 2.0 1.5 1.0 0.5 0.0 1960 1970 1980 1990…
  36. Socially Responsible Investor Briefing – Shell – slide 36
    STRANDED ASSETS HYPOTHESIS IGNORES SUPPLY + DEMAND REALITIES Oil demand & supply Transport underpins oil demand, million barrels of oil per day despite electric vehicle growth 120 Oceans IEA current policies 100 Mountains IEA new…
  37. Socially Responsible Investor Briefing – Shell – slide 37
    DIRECT EMISSIONS MANAGEMENT Design and operations Future energy technology GHG emissions plans in both design phase and Amal steam using renewables for enhanced oil operation of assets recovery New projects include energy…
  38. Socially Responsible Investor Briefing – Shell – slide 38
    INDIRECT EMISSIONS MANAGEMENT FLNG Clean fuels CCS LNG for transport Copyright of Royal Dutch Shell plc 14 April, 2015 39
  39. Socially Responsible Investor Briefing – Shell – slide 39
    SHELL RESEARCH + DEVELOPMENT Total R+D spend Significant R+D spend mln 1bn year since 2007 1,500 Averaging 15% low-carbon R+D 1,000 500 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Shell Peer group Full…
  40. Socially Responsible Investor Briefing – Shell – slide 40
    LOW CARBON R+D AND INVESTMENT STRATEGIES A Commercial operation* B Technology demonstration/research Gas R&D Exploration C Used in Shell operations FEED FID CCS LNG 7.7mtpa On stream LNG 6.5mtpa LNG 7.4mtpa LNG 24mtpa GTL…
  41. Socially Responsible Investor Briefing – Shell – slide 41
    CLIMATE CHANGE ANGUS GILLESPIE VICE PRESIDENT CO2 ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 42
  42. Socially Responsible Investor Briefing – Shell – slide 42
    SHELL GROUP CO2 Group CO2 function what we do Regular assessment of CO2 exposure since 2007 CO2 research and analysis Competitive CO2 positioning Policy and advocacy Portfolio CO2 emissions, intensity, costs Implementation CO2…
  43. Socially Responsible Investor Briefing – Shell – slide 43
    PROJECT ECONOMICS EXAMPLE NPV analysis: example NPV sensitivities: example /yr cumulative 3 12 Oil Price 2 8 1 4 CO2 price 0 0 Capex 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 -1 -4 Opex -2 Annual cashflow -8 Undiscounted…
  44. Socially Responsible Investor Briefing – Shell – slide 44
    SHELL AND IEA PRICE ASSUMPTIONS Oil price Europe CO2 cost /barrel /tonne 160 160 140 140 120 120 100 100 80 80 60 60 40 40 20 20 0 0 2020 2025 2030 2035 2040 2020 2025 2030 2035 2040 IEA Current Policies Shell…
  45. Socially Responsible Investor Briefing – Shell – slide 45
    ASSET PORTFOLIO POTENTIAL RESILIENCE TO SCENARIOS Strategic Oil price effect CO2 cost effect Combined cost effect theme % difference in NPV % difference in NPV % difference in NPV vs Shell 90 scenario vs Shell 40/ tonne scenario…
  46. Socially Responsible Investor Briefing – Shell – slide 46
    ANNUAL ROUNDTABLE FOR SOCIALLY RESPONSIBLE INVESTORS BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 47
  47. Socially Responsible Investor Briefing – Shell – slide 47
    ANNUAL ROUNDTABLE FOR SOCIALLY RESPONSIBLE INVESTORS 14 APRIL 2015 ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 14 April, 2015 62

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