New growth for Shell in Upstream Americas

Calgary, 28 September 2010

Royal Dutch Shell plc (“Shell”) reconfirmed strong momentum in its businesses in
the Americas for a group of shareholders and analysts today, visiting Upstream
assets in Canada. Shell’s oil & gas production in the region could reach 1
million barrels of oil equivalent per day in 2014, an increase of some 40% on
current levels, subject to the pace of investment, which could be some $40
billion for the 2011-14 period.
Shell’s world-wide strategic framework is set around three distinct themes:
performance focus, delivering growth, and maturing new project options.
The “Transition 2009” reorganisation, now completed, created the Upstream
Americas division, simplifying Shell’s businesses, and underpinning some $1
billion of Upstream cost reduction achievement. Upstream Americas is now
organised along four strategic lines, namely heavy oil, onshore gas, deep water
and exploration. This has created a strong platform for new performance focus,
capital efficiency, and faster implementation of strategy.
Shell has invested over $60 billion in Upstream Americas since 2004 including
development of new fields, new exploration leases, and acquisitions of
undeveloped resources positions.
Development and rationalisation of this portfolio continues, with an emphasis on
asset quality, profitable growth and capital efficiency. Upstream Americas asset
sales proceeds are expected to exceed $2 billion in 2010-11, part of Shell’s
world-wide plans for $7-8 billion of disposals.
In heavy oil, the recent start-up of the Jackpine Mine takes the Athabasca Oil
Sands Project (“AOSP”, Shell 60%) to a total capacity of 255,000 bbl/d,
developing over 3 billion barrels of resources. After a period of rapid growth
in the last decade, AOSP’s next focus is on delivering operating synergies and
debottlenecking these facilities, whilst retaining longer-term options for
additional expansion. Shell has a strong track record in cold production and
enhanced oil recovery in California, and growth potential in Canada, where
studies are underway for an 80,000 bbl/d in-situ project at Carmon Creek.
Shell is set for strong growth in tight gas, with North America resources
potential of around 40 tcfe, following a series of acquisitions and acreage
deals. Shell now has an opportunity to deploy technology and drilling know-how
at a large scale, to grow production and to reduce unit costs. Shell’s North
America tight gas production could double from 2009 to 2015, with the potential
to reach over 400,000 barrels of oil equivalent per day (boe/d), subject to the
pace of investment.
The outlook for deep water remains positive, despite the current drilling
moratorium in the Gulf of Mexico. Shell is today announcing the final investment
decision on a 100,000 boe/d tension leg platform in the Gulf, called Mars B
(Shell 71.5%), part of Shell’s post-2014 growth potential.

Exploration performance continues apace, with Gulf of Mexico drilling activities
in 2009 and 2010 adding over 500 million boe for Shell, including the 2010
Appomattox discovery, which has total resources in excess of 250 million boe,
where Shell has an 80% share. These finds are part of a portfolio with >250,000
boe/d of production potential for Shell in the Gulf of Mexico. The exploration
outlook is positive, with a substantial inventory of new prospects, including
plans to drill in Alaska in 2011.
Marvin Odum, Shell’s Director of Upstream Americas commented “Our portfolio
development over recent years has built a strong platform for the future, and
Upstream Americas is entering a phase of strong and profitable growth. We expect
to invest around $10 billion per year in this region to 2014, when oil & gas
production could reach 1 million boe/d. This growth potential underpins Shell’s
2014 world-wide aspiration for 3.7 million boe/d of production.”
Shell’s CEO Peter Voser commented “We are delivering on Shell’s three key
strategic themes in Upstream Americas and world-wide: performance focus,
production growth and maturing new project options. Shell’s oil & gas will be an
important part of the energy mix in this region, and Upstream Americas will be a
key growth engine for Shell in the years to come.”
Enquiries
Media Relations
Shell International Media Relations: +31 70 377 3600

Investor Relations
The Hague – Tjerk Huysinga: +31 70 377 3996 / +44 207 934 3856
USA – Harold Hatchett: +1 713 241 1042

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