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Bernstein Strategic Decisions Conference – Shell

Shell · Sep 30, 2015 · 24 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. Bernstein Strategic Decisions Conference – Shell – slide 1
    COMPANY UPDATE BERNSTEIN STRATEGIC DECISIONS CONFERENCE ROYAL DUTCH SHELL 30 SEPTEMBER 2015 Copyright of Royal Dutch Shell plc 30 September, 2015 1
  2. Bernstein Strategic Decisions Conference – Shell – slide 2
    BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 30 September, 2015 2
  3. Bernstein Strategic Decisions Conference – Shell – slide 3
    SUMMARY Integrated business + performance drive supporting results: 12 months CCS earnings 16.2 billion; CFFO 35.6 billion; dividend + buy-back 14 billion Dividend + buy-back commitment 1.88/share 2015; at least 1.88/share 2016 At…
  4. Bernstein Strategic Decisions Conference – Shell – slide 4
    OIL PRICE + OUTLOOK Oil prices OPEC policy change and non-OPEC growth Brent in per barrel Medium-term supply/demand fundamentals remain positive Responding with urgency + determination Resilience in todays oil prices OPEC…
  5. Bernstein Strategic Decisions Conference – Shell – slide 5
    H1 2015 DELIVERY Earnings + ROACE Cash flow billion % billion billion Upstream Corporate/Other CFFO CFFI Free cash flow (RHS) Downstream ROACE (RHS) Dividend, buyback + gearing Gearing % billion range Integrated business +…
  6. Bernstein Strategic Decisions Conference – Shell – slide 6
    SHELL INTEGRATED GAS PERFORMANCE 2014 Shell LNG* sales + pricing linkage Integrated gas earnings Million tonnes per annum billion per unit Short-term spot 10-15% Gas hubs (e.g. NBP, 20-25% HH) Oil linked: 65% Term contracts 3-6…
  7. Bernstein Strategic Decisions Conference – Shell – slide 7
    FINANCIAL FRAMEWORK AND PRIORITIES Priorities for cash Financial framework 1. Debt reduction Cash performance 2. Dividends 3. Buy-backs + capital investment Pay-out Investment Grow cash flow from operations + free cash…
  8. Bernstein Strategic Decisions Conference – Shell – slide 8
    PULLING LEVERS TO MANAGE SHELL IN THE DOWNTURN Cash performance Pulling our financial levers billion Balance sheet 4Q rolling CFFO Pay-out Investment Reduce operating costs billion billion Reduce capital investment 4Q…
  9. Bernstein Strategic Decisions Conference – Shell – slide 9
    BALANCE SHEET Cash flow surplus Competitive gearing position billion, 4Q rolling Q2 2015 % Cash flow from operations Capex + equity acc. invest. + acq Shell Peer group Asset sales Dividend and buy back Implementing a…
  10. Bernstein Strategic Decisions Conference – Shell – slide 10
    REDUCE OPERATING COSTS Operating costs + outlook Continuous improvement drive billion -10% Supply chain re-set Targeted programmes: Oil Products, North- America onshore, North Sea, others Lower overheads: finance, commercial + IT…
  11. Bernstein Strategic Decisions Conference – Shell – slide 11
    REDUCE CAPITAL INVESTMENT Capital investment - sector Capital investment billion, 4Q rolling billion Project re-phasing / deferral Supply chain savings Dilutions + exits -20% -20% Shell Peer group Shell BG Combination…
  12. Bernstein Strategic Decisions Conference – Shell – slide 12
    TAKING STEPS TO MANAGE CAPITAL INVESTMENT 2013 2014 2015 2016 2017+ Majnoon FFD Carmon Creek ph1-2 FUTURE OPPORTUNITIES Carmon Creek ph3-4 RESOURCES PLAYS Appomattox Vito DEEP WATER Bonga South West Arrow greenfield LNG Elba…
  13. Bernstein Strategic Decisions Conference – Shell – slide 13
    ALASKA OFFSHORE EXPLORATION 2015 2015 Burger J drilling Well completed - strong HSE performance Encountered non-commercial oil & gas Demobilization under-way Decision to cease Alaska offshore exploration Copyright of Royal…
  14. Bernstein Strategic Decisions Conference – Shell – slide 14
    DRIVING LOWER COST IN NEW DEVELOPMENTS Launched P&T change programme Example: Appomattox FID July 2015 Standardise: Shells 7th 4-column host in GOM 20% cost reduction into FID Goal zero: Upfront planning; fewer wells; supply chain No…
  15. Bernstein Strategic Decisions Conference – Shell – slide 15
    PORTFOLIO RESTRUCTURING Resources plays Oil Products Upstream engine Restructuring 77 billion capital employed Copyright of Royal Dutch Shell plc 30 September, 2015 16
  16. Bernstein Strategic Decisions Conference – Shell – slide 16
    PROGRESS WITH RESTRUCTURING Downstream Resources plays billion % billion -30% -35% Cash flow ROACE (RHS) Americas International Potential for sustained 10-12% ROACE + 10 2013-14: restructure Americas billion p.a. CFFO…
  17. Bernstein Strategic Decisions Conference – Shell – slide 17
    ASSET SALES Progressing divestments in 2015 despite weaker market Woodside 9.5% Haynesville + Pinedale Elba LNG Australia DS Italy DS UK retail Wheatstone LNG MLP others Asset sales add focus BC-10 dilution Nigeria onshore…
  18. Bernstein Strategic Decisions Conference – Shell – slide 18
    DELIVER NEW PROJECTS + FREE CASH FLOW Top 10 Shell project start-ups 2014+ Potential cash flow in billion Appomattox Bonga NW Cardamom Clair ph2 Gorgon Gumusut-Kakap 70 oil price 90 oil price Capex Kashagan ph1 Mars B…
  19. Bernstein Strategic Decisions Conference – Shell – slide 19
    SHELL + BG SUMMARY Further reduces our cash breakeven Enhanced free cash flow Enhances dividend potential + delivers buy-backs Accelerates our strategy LNG & deep water leader Value uplift from Shell capabilities at larger…
  20. Bernstein Strategic Decisions Conference – Shell – slide 20
    SHELL + BG: TRANSACTION UPDATE US FTC Transaction approval Announcement CADE approval Early 2016 Complete transaction EU approval Q2 Q3 Q4…
  21. Bernstein Strategic Decisions Conference – Shell – slide 21
    SPRINGBOARD TO CHANGE SHELL: GROW TO SIMPLIFY Simpler,more Longer term1 CFFO/potential Shell Combination billion in billion 2014 2020 focused company Other Longer term1 10 billion p.a. Deep More resilient + water…
  22. Bernstein Strategic Decisions Conference – Shell – slide 22
    DIVIDEND TRACK RECORD + COMMITMENT Dividend track record Managing dividend through cycle billion Balance sheet capacity Dividend commitment: More levers to pull if macro conditions 2015 1.88 per share deteriorate 2016 at least…
  23. Bernstein Strategic Decisions Conference – Shell – slide 23
    CONTINUED DRIVE TO IMPROVE FINANCIAL PERFORMANCE Cash flow from operations Free cash flow billion billion Q215 Q215 Shell Peer group 4Q rolling 4Q rolling ROACE - underlying % Driving competitive performance Q215 4Q…
  24. Bernstein Strategic Decisions Conference – Shell – slide 24
    SUMMARY Integrated business + performance drive supporting results: 12 months CCS earnings 16.2 billion; CFFO 35.6 billion; dividend + buy-back 14 billion Dividend + buy-back commitment 1.88/share 2015; at least 1.88/share 2016 At…

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