Skip to main content Management/Investor Day 2015 – Shell Investor Presentation | Shale Experts
Loading...
Pm

Management/Investor Day 2015 – Shell

Shell · Nov 4, 2015 · 72 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. Management/Investor Day 2015 – Shell – slide 1
    MANAGEMENT DAY INVESTOR HANDOUT ROYAL DUTCH SHELL 3-4 NOVEMBER 2015 Copyright of Royal Dutch Shell plc 3-4 November, 2015 1
  2. Management/Investor Day 2015 – Shell – slide 2
    BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 3-4 November, 2015 2
  3. Management/Investor Day 2015 – Shell – slide 3
    AGENDA Plenary: Ben van Beurden company update Simon Henry LNG + deep water Harry Brekelmans Projects & Technology John Abbott Downstream Q&A Break-out panels: Upstream International + Integrated Gas: Andy Brown Upstream…
  4. Management/Investor Day 2015 – Shell – slide 4
    SUMMARY Integrated business + performance drive supporting results Pulling levers to manage returns in prolonged oil price downturn Grow to simplify: Shell + BG COMPETITIVE FINANCIAL CAPITAL EFFICIENCY PROJECT DELIVERY…
  5. Management/Investor Day 2015 – Shell – slide 5
    INTEGRATED BUSINESS DRIVING FINANCIAL PERFORMANCE Earnings + ROACE Cash flow billion % billion billion 30 15 50 25 40 20 20 10 30 15 20 10 10 5 10 5 0 0 0 0 2011 2012 2013 2014 15Q3 2011 2012 2013 2014 15Q3 4Q rolling 4Q rolling…
  6. Management/Investor Day 2015 – Shell – slide 6
    OIL PRICE + OUTLOOK Oil prices OPEC policy change and non-OPEC growth Brent in per barrel 120 Medium-term supply/demand fundamentals 90 remain positive 60 Global OPEC 30 financial policy Responding with urgency + determination…
  7. Management/Investor Day 2015 – Shell – slide 7
    INDUSTRY DOWNTURN: SHELL RESPONSE Strong balance sheet Asset sales Deliver new projects Gearing 12.7%; 20 billion 2014-15; Shell + BG AA- S&P, Aa1 Moodys 30 billion planned 2016-18, Shell + BG growth projects Restructure…
  8. Management/Investor Day 2015 – Shell – slide 8
    DRIVING LOWER COSTS IN SHELL REDUCE OPERATING COSTS + CAPITAL INVESTMENT Operating costs + outlook Capital investment Project re-phasing / deferral billion billion Supply chain savings 50 60 -10% Dilutions + exits 40 -20% 25 20…
  9. Management/Investor Day 2015 – Shell – slide 9
    MANAGING CAPITAL INVESTMENT 2013 2014 2015 2016 2017+ Majnoon FFD FUTURE Carmon Creek OPPORTUNITIES SHALES Appomattox Vito DEEP WATER Bonga South West Arrow greenfield LNG Elba LNG Browse LNG INTEGRATED GAS…
  10. Management/Investor Day 2015 – Shell – slide 10
    REDUCING COSTS EXAMPLES Heavy oil North America shales billion billion 4 -30% 6 -20% -35% 4 2 2 0 0 2014 2015E 2013 2014 2015E Capital investment Operating costs Capital investment Operating costs 900 million cost…
  11. Management/Investor Day 2015 – Shell – slide 11
    ASSET SALES ADD FOCUS Progressing divestments in 2015 despite weaker market Identified substantial options to drive 30 billion 2016-18 target Woodside 9.5% Haynesville + Pinedale Elba LNG Australia DS Italy DS UK retail Wheatstone…
  12. Management/Investor Day 2015 – Shell – slide 12
    MLP STRUCTURE IMPROVES CAPITAL EFFICIENCY SHELL MIDSTREAM PARTNERS IPO launched October 2014 26.2% distribution growth since first distribution Significant footprint of infrastructure assets in North America to fuel growth…
  13. Management/Investor Day 2015 – Shell – slide 13
    DELIVER NEW PROJECTS Top 10 Shell project start-ups 2014+ billion 10 Appomattox Bonga NW 5 0 Cardamom Clair ph2 -5 -10 Gorgon Gumusut-Kakap 2010 2010 2012 2012 2014 2014 2016 2016 2018 2018 2020 2020 Cash flow…
  14. Management/Investor Day 2015 – Shell – slide 14
    SHELL + BG Further reduces our cash breakeven Enhanced free cash flow Enhances dividend potential + delivers buybacks Accelerates our strategy LNG & deep water leader Value uplift from Shell capabilities at larger scale…
  15. Management/Investor Day 2015 – Shell – slide 15
    SYNERGIES UPDATE: SHELL + BG External verified synergies1 Corporate, administrative, SG&A billion organisation and IT operational efficiencies +40% Procurement Procurement spend 3 Marketing & Reduced costs 2 shipping 1…
  16. Management/Investor Day 2015 – Shell – slide 16
    SYNERGIES UPDATE: SHELL + BG Example: Corporate costs Example: Procurement Optimisation SG&A Optimisation SG&A local spend in areas with Real estate and IT operational overlap Procurement Global scale Procurement Global scale…
  17. Management/Investor Day 2015 – Shell – slide 17
    GROW CASH FLOW + FREE CASH FLOW Synergies Asset sales Capital Growth investment 40% increase to 30 billion 35 billion in LNG + deep water 3.5 billion 2016-2018 2016 combined acceleration Reduced exploration Shell programmes…
  18. Management/Investor Day 2015 – Shell – slide 18
    DIVIDEND TRACK RECORD + PRIORITIES FOR CASH Dividend track record Priorities for cash billion 12 1. Debt reduction 8 Dividend commitment: 2015 1.88 per share 2. Dividends 2016 at least 1.88 per share 3. Buybacks + capital…
  19. Management/Investor Day 2015 – Shell – slide 19
    CASH FLOW MANAGEMENT + TRACK RECORD billion 45 102 106 60 30 BG enhances Shell free cash flow per share 15 Improved dividend capacity + buyback potential 0 5-year average 3-year average 12-month average 2010-2014…
  20. Management/Investor Day 2015 – Shell – slide 20
    SHELL + BG: PREPARING FOR COMBINATION SPRINGBOARD TO CHANGE SHELL Shell + BG integration planning Reorganising Shell Upstream Joint team established 15 June 2015 Today 1.1.2016 Upstream Upstream International 30-60-90 day plans…
  21. Management/Investor Day 2015 – Shell – slide 21
    LONGER TERM OPTIONS Actions taken Heavy oil: Growth investment halted Profitability drive Shales: New International: portfolio restructuring Unconventional Resources Americas: retained growth options organisation 1.1.16…
  22. Management/Investor Day 2015 – Shell – slide 22
    BG SHELL + BG: GROW TO SIMPLIFY logo Longer term Review + reduce Simpler more focused company Deep water + Integrated Gas Higher profitability New scale + running room Focus + phased growth Predictable + structured growth…
  23. Management/Investor Day 2015 – Shell – slide 23
    SIMON HENRY CHIEF FINANCIAL OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 3-4 November, 2015 24
  24. Management/Investor Day 2015 – Shell – slide 24
    SHELL + BG: LNG + DEEP WATER LNG Deep water Nigeria LNG, 6 trains Mars and Mars B platforms, Gulf of Mexico standard TLP designs Attractive returns Growth potential Shell capability and technology Upfront capital…
  25. Management/Investor Day 2015 – Shell – slide 25
    LNG MARKET DEVELOPMENT LNG import countries LNG regasification capacity Million tonnes per annum 1000 500 0 1990 2000 2005 2010 2015 2020 2025 2015 2020 Asia Pacific North America Middle East Europe South America North…
  26. Management/Investor Day 2015 – Shell – slide 26
    LNG PRICING 2014 Shell LNG sales + pricing linkage Regional gas prices Million tonnes per annum /mmbtu 25 Short-term spot 20 10-15% 30 15 10 Gas hubs 20-25% (e.g. NBP, HH) 5 0 20 2005 2007 2009 2011 2013 2015 Japan landed…
  27. Management/Investor Day 2015 – Shell – slide 27
    INTEGRATED GAS: TRACK RECORD Financial performance Shell Shell + BG LNG growth billion % Equity LNG capacity in million tonnes per annum Repsol LNG Pluto LNG (Woodside share reduction) QG4 (MLNG Dua 12 Sakhalin Pearl GTL North…
  28. Management/Investor Day 2015 – Shell – slide 28
    LNG: SHELL + BG IOC LEADERSHIP PORTFOLIO Combi- 2014* Shell BG nation Equity LNG UK liquefaction 26 7 33 Spain Sakhalin capacity (mtpa) Sabine Pass Cove Point Elba QG-4 Lake Charles LNG delivered Baja Egypt Hazira 34 11 45…
  29. Management/Investor Day 2015 – Shell – slide 29
    LNG: PORTFOLIO + OPTIONS BG logo World-class, profitable LNG business Opportunity to high-grade development queue More predictable + structured growth Options FEED Under construction On stream capacity Abadi NLNG T7 Arrow…
  30. Management/Investor Day 2015 – Shell – slide 30
    DEEP WATER: SHELL + BG LEADING IOC PORTFOLIO + TRACK RECORD Shell track record in project delivery Step change in Brazil Gulf of Mexico Potential to reshape portfolio + Malaysia/Brunei exploration Nigeria On stream Brazil…
  31. Management/Investor Day 2015 – Shell – slide 31
    DEEP WATER: TRACK RECORD Shell deep water performance Deep water production billion % Thousand boe per day per barrel 8 24 480 120 6 18 360 90 4 12 240 60 2 6 120 30 0 0 0 0 2012 2013 2014 15Q3 2010 2011 2012 2013…
  32. Management/Investor Day 2015 – Shell – slide 32
    DEEP WATER: PORTFOLIO + OPTIONS BG logo Leading positions in Brazil, Gulf of Mexico, Nigeria, Malaysia Improved predictability in development programme Platform to focus exploration Options FEED Under construction On stream…
  33. Management/Investor Day 2015 – Shell – slide 33
    REVIEWING AND REDUCING EXPLORATION ACTIVITY Exploration expenditure Exploration positions billion 6 -40% 4 Shell BG Shell + BG 2 0 2009 2010 2011 2012 2013 2014 2015E 2018E Combination Near field exploration Frontier…
  34. Management/Investor Day 2015 – Shell – slide 34
    HARRY BREKELMANS PROJECTS & TECHNOLOGY DIRECTOR ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 3-4 November, 2015 35
  35. Management/Investor Day 2015 – Shell – slide 35
    PROJECTS & TECHNOLOGY: PRIORITIES HSSE - Goal zero No harm, no leaks Continued year-on-year improvement Improve capital efficiency 4 billion in 2015-16 Affordable technology Drives value creation Strengthen…
  36. Management/Investor Day 2015 – Shell – slide 36
    SAFETY: ASSET INTEGRITY AND PROCESS SAFETY Preventing + mitigating major safety events Process safety Control barriers Recovery measures Number of incidents 400 CONSEQUENCES 200 THREATS TOP EVENT 0 2012 2013 2014 '15…
  37. Management/Investor Day 2015 – Shell – slide 37
    PROJECT DELIVERY TRACK RECORD Upstream IPA cost benchmark 75 material project start-ups since 2011 Improving trend on cost performance Better Front End Loading for projects in Select phase 2010 2011 2012 2013 2014 75% projects…
  38. Management/Investor Day 2015 – Shell – slide 38
    IMPROVE COMPETITIVENESS DOWNSTREAM UPSTREAM DEEP WATER INTEGRATED GAS LONGER TERM ENGINE ENGINE SUPPLY CHAIN TRANSFORMATION COMPETITIVE SCOPING TRANSFORMATIONAL THEMES EFFICIENT EXECUTION AFFORDABLE TECHNOLOGY Goal…
  39. Management/Investor Day 2015 – Shell – slide 39
    IMPROVE CAPITAL EFFICIENCY 2015-16 ACTIONS Cancel/ defer projects Portfolio management Monetize / exit non-core Supply chain 2015-16 capital efficiency potential: 4 billion Competitive scoping Transform project/ well…
  40. Management/Investor Day 2015 – Shell – slide 40
    DEEP WATER GULF OF MEXICO: PROJECT INTERVENTIONS Stones FID 2013 Appomattox FID 2015 Vito FEED 2014 Vito Shell interest 51% Shell interest 100%, 50 kboe/d peak Shell interest 79%, 175 kboe/d peak Powernap Shell interest 50% FPSO…
  41. Management/Investor Day 2015 – Shell – slide 41
    DEEP WATER VALUE CREATION EUR actual versus first oil view 1994 Auger +183% % 300% 1996 Mars +274% 1990s 1997 Ram Powell +102% Mars + Mars B 1999 Ursa +179% 2001 Brutus +78% 200% Ursa Perdido 2005 Bonga +151% Auger 2000s 2009…
  42. Management/Investor Day 2015 – Shell – slide 42
    SUPPLY CHAIN TRANSFORMATION EXTRACTING VALUE IN THE SUPPLY CHAIN 40% demand driven 40% specification driven 20% price driven Planning, scheduling, efficiency + Design, equipment and scope Contract rates + unit prices utilisation…
  43. Management/Investor Day 2015 – Shell – slide 43
    SUPPLY CHAIN TRANSFORMATION RIG STRATEGY AND RIG RATES Ultra deep water rig rates Rig strategy Thousand per day Long term contracts provide competitive 600 advantage with new build / high specification units 500 Global procurement…
  44. Management/Investor Day 2015 – Shell – slide 44
    EFFICIENT EXECUTION + SUPPLY CHAIN TRANSFORMATION Shell operated wells top-quartile performance Price positioning: Enterprise Framework Agreements Shell operated wells, billion % of total Shell operated wells spend EFA prices vs. range…
  45. Management/Investor Day 2015 – Shell – slide 45
    AFFORDABLE TECHNOLOGY Research & development budget 2015 Strengthen core business SmartConnect 1.1 billion Strengthen core assets Long range research Frontier energy/ chemicals innovation Remote assisted operations centre, New…
  46. Management/Investor Day 2015 – Shell – slide 46
    PRELUDE FLOATING LNG: UPDATE Geoje, South Korea 3.6 mtpa LNG + 1.7 mtpa NGLs Vessel All 14 topside modules installed All 6 turret modules installed In-field All wells drilled on schedule, 3 wells to complete and test Four 3 km…
  47. Management/Investor Day 2015 – Shell – slide 47
    PROJECTS & TECHNOLOGY: PRIORITIES Goal zero No harm, no leaks Continued year-on-year improvement Improve capital efficiency 4 billion in 2015-16 Affordable technology Drives value creation Strengthen deployment…
  48. Management/Investor Day 2015 – Shell – slide 48
    JOHN ABBOTT DOWNSTREAM DIRECTOR ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 3-4 November, 2015 49
  49. Management/Investor Day 2015 – Shell – slide 49
    DOWNSTREAM STRATEGY Developing and sustaining competitive advantage through Advantaged Improving our Differentiated Leveraging the feedstock + footprint Products + Brand supply Customer Offer Priority to improve our financial…
  50. Management/Investor Day 2015 – Shell – slide 50
    DOWNSTREAM MACRO Oil Products Chemicals Increasing competition from large complex Chemicals demand growth robust refineries Significant feedstock price movements 2015 improved refinery margins North America re-emerges as chemicals…
  51. Management/Investor Day 2015 – Shell – slide 51
    SHELL DOWNSTREAM VALUE CHAINS Marketing Trading Refining Chemicals Restructured Refining enabling integrated value Global footprint Strong and growing maximization Improved returns returns Excess industry refinery capacity…
  52. Management/Investor Day 2015 – Shell – slide 52
    DOWNSTREAM FINANCIAL DRIVERS Earnings Capital employed billion 45 billion as at 15Q3 10 8 Refining and Trading 6 Marketing 4 Chemicals 2 0 2012 2013 2014 15Q3 4Q rolling Refining and Trading Chemicals Marketing Cash flow…
  53. Management/Investor Day 2015 – Shell – slide 53
    IMPROVING OUR DOWNSTREAM FOOTPRINT 60 PERFORMANCE UNITS DRIVING ACCOUNTABILITY Portfolio change Asset sales billion Selective Growth: Chemicals 4 China LNG for transport Australia DS Premium fuels + lubes Italy DS 3 Fix:…
  54. Management/Investor Day 2015 – Shell – slide 54
    REDUCING REFINING CAPACITY Refining capacity Retain competitive sites Million barrels per day of refineries Refinery capacity in thousand barrels per day (100%) 4 60 600 -20% 3 45 Increase value chain 2 30 500 integration 1 15…
  55. Management/Investor Day 2015 – Shell – slide 55
    IMPROVING OUR MANUFACTURING PROFITABILITY 2015 PROJECTS North America - Scotford NW Europe Pernis and Singapore Bukom and Jurong Rhineland Scotford, Canada Pernis, The Netherlands Pulau Bukom, Singapore Hydrocracker…
  56. Management/Investor Day 2015 – Shell – slide 56
    CHEMICALS PERFORMANCE + POTENTIAL Regionally balanced Shift to advantaged Chemicals returns portfolio feedstock billion 2 18% 12% 2014 2007 2014 1 6% North America Advantaged liquids Generic liquids 0 0% Europe Advantaged gas…
  57. Management/Investor Day 2015 – Shell – slide 57
    MARKETING: INVESTING IN SELECTIVE GROWTH Marketing China retail Brazil biofuels + retail % billion liters % billion liters % 24 6 16 25 20 18 12 4 12 8 20 10 2 6 4 0 0 0 15 0 2012 2013 2014 15Q3 2012 2013 2014 15Q3 4Q rolling…
  58. Management/Investor Day 2015 – Shell – slide 58
    DOWNSTREAM: NEW INVESTMENT POTENTIAL Capital investment billion 8 6 Capital discipline and project delivery 4 Making our manufacturing sites more competitive 2 Selective investment in growth: marketing + Chemicals 0 2011 2012…
  59. Management/Investor Day 2015 – Shell – slide 59
    DOWNSTREAM COMPETITIVE LANDSCAPE Downstream ROACE Oil products ROACE % 15Q3 % 20% 4Q rolling 20 10% 10 0% 0 2011 2012 2013 2014 15 Q2 2011 2012 2013 2014 15Q3 4Q rolling 4Q rolling Shell Peers Chemicals ROACE Brand % Global…
  60. Management/Investor Day 2015 – Shell – slide 60
    BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 3-4 November, 2015 61
  61. Management/Investor Day 2015 – Shell – slide 61
    CONTINUED DRIVE TO IMPROVE FINANCIAL PERFORMANCE Cash flow from operations Free cash flow billion billion 60 40 30 40 20 20 10 0 0 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 -10 15Q3 15Q3 Shell Peer group 4Q rolling 4Q…
  62. Management/Investor Day 2015 – Shell – slide 62
    SUMMARY Integrated business + performance drive supporting results Pulling levers to manage returns in prolonged oil price downturn Grow to simplify: Shell + BG COMPETITIVE FINANCIAL CAPITAL EFFICIENCY PROJECT DELIVERY…
  63. Management/Investor Day 2015 – Shell – slide 63
    QUESTIONS & ANSWERS Q&A ROYAL DUTCH SHELL 3-4 NOVEMBER 2015 Copyright of Royal Dutch Shell plc 3-4 November, 2015 64
  64. Management/Investor Day 2015 – Shell – slide 64
    BACK UP ROYAL DUTCH SHELL 3-4 NOVEMBER 2015 Copyright of Royal Dutch Shell plc 3-4 November, 2015 65
  65. Management/Investor Day 2015 – Shell – slide 65
    NORTH AMERICA RESOURCES PLAYS Focus on 4 key basins Western Canada Gas Integration value with LNG Canada Reduced spending Western Canada LRS Reviewing options Best in class Duvernay land position Moving to development in select…
  66. Management/Investor Day 2015 – Shell – slide 66
    PERMIAN DELAWARE BASIN LOW COST, EARLY WOLFCAMP ENTRY NEW MEXICO Production growth Thousand boe per day 40 +45% 30 20 10 TEXAS 0 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 Oil/ Liquids Associated gas Wolfcamp well…
  67. Management/Investor Day 2015 – Shell – slide 67
    DEEP WATER GULF OF MEXICO COMPETITIVE PERFORMANCE AND PORTFOLIO Production Appomattox Thousand boe per day Drilling Kaikias 175 kboe/d potential moratorium 300 650 million boe resources 100 million boe resources 200 Attractive…
  68. Management/Investor Day 2015 – Shell – slide 68
    DEEP WATER PROJECT DELIVERY 2014 START-UPS AND PERFORMANCE Bonga NW Gumusut-Kakap Thousand boe per day, Shell share Thousand boe per day, Shell share Shutdown FPSO to start 50 50 Maintenance up gas facilities 40 40 Start-up FPSO 30…
  69. Management/Investor Day 2015 – Shell – slide 69
    LNG SUPPLY AND DEMAND DYNAMICS LNG demand LNG supply* N.A. LNG export development million tonnes per annum million boe/d million tonnes per annum million boe/d million tonnes per annum 500 500 FID 400 10 400 10 Brownfield 300…
  70. Management/Investor Day 2015 – Shell – slide 70
    OIL SANDS Shell unit operating costs Driving down cash unit costs per barrel 60 Significant integration value with Downstream Scotford refinery -30% 40 Improved AOSP reliability 20 Quest CCS start-up in Q3 2015 0 2010 2011 2012…
  71. Management/Investor Day 2015 – Shell – slide 71
    DOWNSTREAM PERFORMANCE UNITS COMPETITIVE FINANCIAL PERFORMANCE 60 Performance units Example of performance unit Drive bottom line focus Rheinland GtL Oils & waxes refinery Address underperforming assets Lubes Supply Retail NL…
  72. Management/Investor Day 2015 – Shell – slide 72
    DOWNSTREAM HSSE AND OPERATING PERFORMANCE Focus on HSSE continues Energy intensity Injuries TRCF/million working hours million working hours Index year 2000 2 400 105 100 1 200 95 90 0 0 85 2011 2012 2013 2014 15Q3 2003 2005 2007…

From the store

Browse maps, data & reports in the Shale Experts store