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1Copyright of Royal Dutch Shell plc 18 April, 2012
ROYAL DUTCH SHELL PLCINVESTING FOR SUSTAINABLE GROWTHAnnual SRI EventLondonApril 18, 2012
2Copyright of Royal Dutch Shell plc 18 April, 2012
DEFINITIONS AND CAUTIONARY NOTE
Resources: Our use of the term “resources” in this announcement includes quantities of oil and gas not yet classified as Securities and Exchange Commission of theUnited States ("SEC") proved oil and gas reserves or SEC proven mining reserves. Resources are consistent with the Society of Petroleum Engineers 2P and 2Cdefinitions.
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate entities. In this announcement "Shell", "Shell Group" and "RoyalDutch 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 byidentifying the particular company or companies. "Subsidiaries", "Shell subsidiaries" and "Shell companies" as used in this announcement refer to companies in whichShell either directly or indirectly has control, by having either a majority of the voting rights or the right to exercise a controlling influence. The companies in whichShell has significant influence but not control are referred to as "associated companies" or "associates" and companies in which Shell has joint control are referred toas "jointly controlled entities". In this announcement, associates and jointly controlled entities are also referred to as "equity-accounted investments". The term "Shellinterest" is used for convenience to indicate the direct and/or indirect (for example, through our 23 per cent shareholding in Woodside Petroleum Ltd.) ownershipinterest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.
This announcement contains forward looking statements concerning the financial condition, results of operations and businesses of Shell and the Shell Group. Allstatements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of futureexpectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actualresults, 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 Shell and the Shell Group 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", "goals", "intend", "may", "objectives", "outlook", "plan", "probably", "project", "risks", "seek", "should", "target", "will" and similar terms andphrases. There are a number of factors that could affect the future operations of Shell and the Shell Group and could cause those results to differ materially from thoseexpressed in the forward looking statements included in this announcement, 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 industrycompetition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successfulnegotiation 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 andregions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in theapproval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. All forward looking statements contained in thisannouncement are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance onforward looking statements. Additional factors that may affect future results are contained in Shell's 20-F for the year ended 31 December 2011 (available atwww.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 thisannouncement, 18 April 2012. Neither Shell nor any of its subsidiaries nor the Shell Group undertake any obligation to publicly update or revise any forward lookingstatement 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 inferredfrom the forward looking statements contained in this announcement.
Shell may have used certain terms, such as resources, in this announcement that the SEC strictly prohibits Shell from including in its filings with the SEC. U.S. investorsare urged to consider closely the disclosure in Shell's Form 20-F, File No 1-32575, available on the SEC website www.sec.gov. You can also obtain these forms fromthe SEC by calling 1-800-SEC-0330.
3Copyright of Royal Dutch Shell plc 18 April, 2012
ROYAL DUTCH SHELL PLCINVESTING FOR SUSTAINABLE GROWTH
PETER VOSERCHIEF EXECUTIVE OFFICER
4Copyright of Royal Dutch Shell plc 18 April, 2012
ROYAL DUTCH SHELL PLCINVESTING FOR SUSTAINABLE GROWTHCHAD HOLLIDAYNON EXECUTIVE DIRECTORCHAIRMAN CORPORATE & SOCIALRESPONSIBILITY BOARD COMMITTEE
5Copyright of Royal Dutch Shell plc 18 April, 2012
ACTIVITIES OF THE CSRC
2011 FOCUSField trips: Marcellus, China, Oil Sands
Personal safety, environmental performance
Asset integrity
2012 PRIORITIESField trips: North Sea, Nigeria
Sustained focus on Nigeria
Process safety/asset integrity
Arctic and deepwater development
USA: MARCELLUS TIGHT GAS
NIGERIA: AFAM VI POWER PLANT
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PARTNERSHIPS & BEST PRACTICE
Danish Institute for Human Rights
Institute for Human Rights & Business
Global Business Initiative
IPIECA
Professor Ruggie case study
WORKING WITH SUPPLIERSHUMAN RIGHTS
Wetlands International
IUCN
The Nature Conservancy
EarthWatch Institute
ENVIRONMENTAL
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ROYAL DUTCH SHELL PLCINVESTING FOR SUSTAINABLE GROWTH
PETER VOSERCHIEF EXECUTIVE OFFICER
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ENERGY OUTLOOK
ROBUST DEMAND GROWTH
Energy demand outlook in million boe/d
Shell estimates
Shell activities
INDUSTRY OUTLOOK Hydrocarbons dominate outlook
Growth required in all sectors of energy mix
Renewable growth particularly strong
Energy policy + sustained investment
SHELLCrude oil & oil products
Natural gas & LNG
Biofuels, wind, carbon capture + storage
Petrochemicals
0
100
200
300
400
1980 1990 2000 2010 2020 2030 2040 2050
Oil Natural Gas Biomass Wind Coal Nuclear Solar Other renewables
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LEADER IN A GLOBAL GROWING GAS MARKET
GAS DEMAND GROWTH: REGIONAL OVERVIEW SHELL PRODUCTION
0
5
10
15
20
25
30
OTHER
HENRY HUB
OIL
GAS
0
1
2
3
Million boe/d Million boe/d
Production Split
Price Exposure
North America
Europe Asia Pacific
Middle East
Other
2008
2035
2008
2035
2008
2035
2008
2035
2008
2035
+29%
+23%+189%
+89%
+86%~75% oil linked
~25% hub priced/ spot
2011
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BIOFUELS GROWTH
Hydrogen from Coal
Conventional Gasoline
Conventional Diesel
Electricity-Coal
Hydrogen from Natural Gas
Sugar Cane Ethanol
Cellulosic Ethanol (Iogen)
LOW CARBON TRANSPORT FUELSWell to wheel CO2 intensity
-89%
-84%
-40%
-16%
-11%
+34%
Source: CONCAWE/JRC/EUCAR wtw report (version 3)
RAIZEN JOINT VENTURE (COSAN)
Leading Brazil ethanol player
(Top 5 globally)
Sugar cane capacity ~60 mtpa from 24 mills
~ 2 bln litres ethanol production per year
Prioritising sustainability issues
RESEARCHING ADVANCED BIOFUELS
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WATER-ENERGY-FOOD
ENERGY is needed to clean and transport water
WATER is needed to generate energy
FOOD transports (virtual) water
WATER is needed to grow food
ENERGY is needed to produce food
FOOD can be used to produce energy
WATER+30% DEMAND
FOOD+50% DEMAND
ENERGY+40% DEMAND
% Increase in demand by 2030
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WATER USE FOR ENERGY
SHELL ANALYSIS OF WATER USE IN ENERGY PRODUCTION
1
10
100
1,000
10,000
100,000
1,000,000
Purely rain fed(Biofuels)
Typical average
Global rangeConsumption Consumption
Withdrawals Withdrawals
<
Typical average
Freshwater intensity (litres/GJ Low heating value)
Loga
rithm
ic s
cale
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SAFETY IN SHELL
2012 HSSE PRIORITIES AND FOCUSInjuries - TRCF
Fatalities per 100 million working hours (employees and contractors)
SAFETY PERFORMANCE
0
2
4
6
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11
IOC Range Shell
400
500
600
700
800
900
0
2
4
6
8
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11
Working Hours (RHS) Shell
SIMPLIFY & COMPLYOne HSSE & SP Control Framework Shell wide
Life-Saving Rules
FOCUS AREASProcess Safety
Road Safety
Contractor HSSE Performance
Cap & contain systems: global initiatives
SUSTAINStrong safety culture and leadership
Employees and contractors per million working hours; Shell operated facilities
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ENVIRONMENTAL PERFORMANCE MEASUREMENT
EMISSIONS
65
75
85
95
105
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11
Million tonnes CO2 equivalentENERGY INTENSITY
85
90
95
100
105
0
0.5
1
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11
Upstream excl. Oil Sands & GTLRefining IndexChemicals Index
Upstream – gigajoules/tonnes production Index
0
2
4
6
8
10
0
200
400
600
800
1000
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11
Number of SpillsVolume of Spills (RHS)
5
10
15
20
25
30
'02 '03 '04 '05 '06 '07 '08 '09 '10 '11
Million tonnes CO2 equivalent No. of Operational spills Volume: thousand tonnesFLARING OPERATIONAL SPILLS
Data 100% basis for companies and joint venture where Shell is the operator
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PROCESS SAFETY + ASSET INTEGRITY
STANDARD ASSET INTEGRITY MANAGEMENT SAFETY CASE ‘BOW TIE’ MODEL: PREVENTION AND RECOVERY - INDUSTRY
Integrity Leadership
Technical Integrity
Design Integrity
Operating Integrity
Promoting a culture of Chronic Unease among leaders to avoid complacency
Established technical process safety discipline team
Improving worksite hazard awareness to combat risk normalization
Response & Recovery
Control & Barriers Incident
Haz
ard
Cons
eque
nces
Mitigate consequences
Minimize likelihood
A safety case approach to risk identification and mitigation
Shell integrated the bow tie methodology in the 1990s
Systematic approach to risk management
Involve contracting companies
Full alignment & clear accountabilities between parties
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2011 SPILL AND REMEDIATION PERFORMANCE
30% drop in operational spill volume
351 sites remediated (272 in 2010)
Reduction in remediation backlog from 400 end 2010to 274 sites end 2011
NIGERIA: SPDC
PIPELINE REPLACEMENT
NEMBE CREEK TRUNK LINE: COMPLETE 2010
97 km; $1.1 billion
TRANS NIGER PIPELINE LOOP PROJECT
Around Ogoniland; major area of crude theft
Pending approval by government partner
0
50
100
150
200
0
5
10
15
2006 2007 2008 2009 2010 2011
SabotageOperationalOperationalSabotage
Oil spills, thousand tonnesENVIRONMENT: SPILLS
Volume of Spills:
Number of Spills (RHS):
SPDC = 30% Shell, 55% NNPC , 10% Total, 5% Agip ; all data on 100% basis
NEMBE CREEK TRUNK LINE REPLACEMENT
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NIGERIA: SPDC FLARING
ASSESSING NEW INVESTMENT FOR GAS UTILIZATION
Forcados Yokri & Southern Swamp AGG
Completion in 2014/2015; ~ $4 billion investment
Gas gathering, facility upgrades and new oil production
After completion, SPDC flaring intensity will be below the current worldwide industry average
FORKADOS YOKRI - SOUTH BANK
Boe gas flared per barrel produced (2010 data)
0.0
0.1
Nigeria Industry
SPDC Nigeria Industry
SNEPCO
ENVIRONMENT: FLARINGMtpa CO2e flaring SPDC production kboe/d
0
200
400
600
800
1000
0
5
10
15
2005 2006 2007 2008 2009 2010 2011Gas Flared Production
PERFORMANCE
SPDC = 30% Shell, 55% NNPC , 10% Total, 5% Agip ; all data on 100% basis
OffshoreOnshore
18Copyright of Royal Dutch Shell plc 18 April, 2012
NIGERIA: OIL THEFT + ILLEGAL REFINING
IMO RIVER – SEPTEMBER 2011
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AOSP-1 ramp-up
Debottlenecking opportunities
Quest CCS project FID expected in 2012
NORTH AMERICA – SUSTAINABLE DEVELOPMENT
ALASKA OIL SANDSTIGHT GAS
Drilling plans for 2012
Extensive preparations:
Community engagements
Science program
Oil spill response
Global tight gas operating principles launched in 2011
Working with industry & regulators on consistent/robust standards
DISCOVERER DRILL SHIP
NANUK OIL SPILL RESPONSE VESSEL
QUEST CARBON CAPTURE & STORAGE
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SHELL
CUSTOMER AND PARTNER FOCUS
PROFITABILITY & PERFORMANCE
SUSTAINABILITY & GROWTH
VALUE ADDED TECHNOLOGY
“As part of the Shell Business Principles, we commit to contribute to sustainable development. This requires balancing short and long term interests, integrating economic, environmental and social considerations into business decision-making.”
Shell General Business Principles
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INVESTING FOR SUSTAINABLE GROWTHQUESTIONS & ANSWERS
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INVESTING FOR SUSTAINABLE GROWTHAPPENDICES
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NIGERIA
Completed
Ongoing
ERHA/BOSI
GBARAN UBIE
OPL245
BONGA AFAM POWER STATION
NIGERIA LNG
OGONILAND
OML 4/38/41
2642 34
40
30
BONNY TERMINAL
Security situation still tenuous
2 Fatalities YTD 2012
Attack on an environmental survey
Increase in oil theft and illegal refining
Estimates of 150 kboe/d of oil theft
SPDC ASSET SALE ONGOINGOver 2010 and 2011, 8 onshore blocks were put up for sale
5 completed, 3 ongoing
Part of a normal portfolio optimization
Shell is committed to the onshore and near shore in Nigeria
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WATER USE FOR ENERGY
FRESH WATER WITHDRAWAL FOR ENERGY
Billion m3/year
FRESH WATER CONSUMPTION FOR ENERGY
Billion m3/year
0
100
200
300
1980 1990 2000 2010 2020 2030 2040 2050
Fossils production Biofuels productionRefining, GTL & CTL Elec. & Heat - CoalElec. & Heat - Oil Elec. & Heat - GasElec. & Heat - Biomass Elec. & Heat - NuclearElec. & Heat - CSP
0
100
200
300
400
500
600
700
800
1980 1990 2000 2010 2020 2030 2040 2050
Fossils production Biofuels productionRefining, GTL & CTL Elec. & Heat - CoalElec. & Heat - Oil Elec. & Heat - GasElec. & Heat - Biomass Elec. & Heat - NuclearElec. & Heat - CSP
Shell estimates
25Copyright of Royal Dutch Shell plc 18 April, 2012
CANADA: ATHABASCA OIL SANDS PROJECT
ORE HAULING AT AOSP
2011 PROGRESSRamping up of production from Jackpine mine + Upgrader started (+100 kbbl/d)
Joined new Canadian Oil Sands Innovation Alliance
Industry tailings collaboration
QUEST CCS PROJECTCapture CO2 at the Scotford Upgrader from 3 Hydrogen Units - >1 mtpa CO2
Government of Alberta and Government of Canada funding for ~C$865 million
Regulatory applications and project scoping progressing - FID target in 2012
DNV certification of Quest storage reservoir
26Copyright of Royal Dutch Shell plc 18 April, 2012
SHELL & TIGHT GAS: 5 CORE PRINCIPLES
27Copyright of Royal Dutch Shell plc 18 April, 2012
ALASKA OFFSHORE DRILLING PLANS
NANUK OIL SPILL RESPONSE VESSEL
KULLUK CONICAL RIG
SHELL PREPAREDNESS~100 offshore wells drilled by industry
Low pressure reservoirs; shallow water
Shell unique response preparations:
Arctic specific rig
Oil spill response vessels
Cap and contain system
Redundant rig capability
Backup BOP
Over 450 community engagements since 2006
Extensive science program
2012 ACTIVITIESPermitting on track
Drilling expected mid 2012