IEEJ：March 2021 © IEEJ2021

THE CONTEXT FOR OUR STRATEGY

THE ENERGY TRANSFORMATION SCENARIOS
BUSINESS ENVIRONMENT OVERVIEWPeter Wood
Chief Energy Advisor, Group Strategy

www.shell.com/ tra nsforma tionscena rios
# ShellScena riosWarning:

Uncertainties Ahead

Shell’s scenarios are not intended to be projections or forecasts of the future. Shell’s scenarios, including the scenarios
ontainedc in this presentation, are not Shell’s strategy or business plan. When developing Shell’s strategy, our scenarios aree ofon
The Sky 1.5
many variables that we consider. Ultimately, whether society meets its goals to decarbonise is not within Shell’s control.
ileWh
we intend to travel this journey in step with society, only governments can create the framework for success.
scenario starts with data from Shell’s
Sky scenario, but there are important updates. First, the outlook uses the most recent modelling for the impact and recoveryCOVID-19
fromconsistent with aSky 1.5 scenario narrative. Second, it blends thisprojection into existingSky (2018) energy system data by around 2030. Third, the extensive scale-up of nature-based solutions is brought into the core scenario, which benefits from extensive new modelling of that scale-up. (In 2018, nature-based
solutions required to achieve 1.5° C above pre-industrial levels by the end of this century wereanalysed as a sensitivity toSky. This analysis was also reviewed and included in the IPCC Special Report on Global Warming of °1.5
C (SR15).) Fourth,
our new oil and natural gas supply modelling, with an outlook consistent with theSky 1.5 narrative and demand, is presented for the first time. Fifth, theSky 1.5 scenario draws on the latest historical data and estimates to 2020 from various sources,
particularly the extensive International Energy Agency energy statistics. As withSky, this scenario assumes that society achieves the°1.5
C stretch goal of the Paris Agreement. It is rooted in stretching but realistic development dynamics today, but
explores a goal-oriented way to achieve that ambition. We worked back in designing how this could occur, considering the realiti
es of the situation today and taking into account realistic timescales for change. Of course, there is a range of possiblepaths in detail that society could take to achieve this goal. Although achieving the goal of the Paris Agreement and therefutu
depicted in Sky 1.5 while maintaining a growing global economy will be extremely challenging, today it is still a technicallypossible path. However, we believe the window for success is quickly closing.
The companies in which Royal Dutch Shell plc directly and indirectly owns are separate legal entities. In this presentation“Shell”, “Shell Group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal DutchShell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Royal Dutchll She
plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose isdserveby identifying the particular entity or entities. “Subsidiaries”, “Shell subsidiaries” and “Shell companies” as used inpresentationto
thisrefer to entities over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated
arrangements over which Shell has joint control are generally referred to as “joint ventures” and “joint operations” respecti
vely. Entities over which Shell has significant influence, but neither control nor joint control, are referred to as “associates”.
The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shellaninentity or unincorporated joint arrangement, after exclusion of all third-party interest.
This presentationcontains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning
the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other thanstatements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statementsof future expectations that are based on management’s current expectations and assumptions and involve known andunknown risks and uncertainties that could cause actual results, performance or events to differ materially from those sedexpres
or implied in these statements. Forward-looking statements include, among other things, statements concerning thepotential exposure of Royal Dutch Shell to market risks and statements expressing management’s expectations, beliefs, es,estimat
forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases
such as “aim”, “ambition”, “anticipate”, “believe”, “could”, “estimate”, “expect”, “goals”, “intend”, “may”, “objectives”, “outlook”, “plan”, “probably”, “project”, “risks”, “schedule”, “seek”, “should”, “target”, “will” and similar terms and phrases.
hereT area number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differriallymatefrom those expressed in the forward-looking statements included in this presentation, including (without limitation): (a)icepr
fluctuations in crude oil and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d)gdrillin
and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental andcalphysi
risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful
negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject tointernational sanctions; (j) legislative, fiscal and regulatory developments including regulatory measures addressing climatechange; (k) economic and financial market conditions in various countries and regions; (l) political risks, including theofrisks
expropriation and renegotiation of the terms of contracts with governmental entities, or delays or advancements in the approv
al of projects and delays in the reimbursement for shared costs; (m) risks associated with the impact
pandemics,ofsuch as
the COVID-19 (coronavirus) outbreak;and (n) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous
ividendd payments. All forward-looking statements contained in this presentation
areexpressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers shouldot placen undue reliance on forward-looking statements. Additional risk factors that may affect future results are contained in RoyalDutch Shell’s Form 20-F for the year ended December 31, 2019 (available atwww.shell.com/investorand www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this presentationand should be consideredby the reader. Each forward-looking statement speaks only as of the date of thispresentationMarch 3, 2021. Neither Royal Dutch Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking
statement as a result of new information, future events or other information. In light of these risks, results could differ
ateriallym from those stated, implied or inferred from the forward-looking statements contained in this presentation.
We may have used certain terms, such as resources, in this presentation that the U.S. Securities and Exchange Commission) strictly(SECprohibits us from including in our filings with the SEC. Investors are urged to consider closely the disclosurer in ou
Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.

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Why scenarios?
Stretch mindsets forbetter-informed decisions
Help to improve judgmentin the face of radicaluncertainties

The PresentThe Path

The Future

FO REC ASTSEN SITIVITIESSC EN ARIO STHE ENERGY TRANSFORMATION SCENARIOS
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The Energy Transformation Scenarios

WealthFirstWaves

Sky 1.5
Islands

HealthFirst

SecurityFirst

THE ENERGY TRANSFORMATION SCENARIOS
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Waves Late, but fastdecarbonisation

 W ealth first – repair the economy
 Surge in energy use and emissions
 G rowing inequality and more frequentand extreme weather events
 Social pressures; issues intensify
 Backlash forces rapid policy-driven

reductions in fossil fuels 2.3° C above pre-industrial levels by

the end of this century

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Islands Late and slowdecarbonisation

 Security first – growing nationalism
 Frictions in collaboration and trade Economies stagnate; growth in energy

demand stalls
 G lobal climate action slows
 C leaner technology makes slow progress
 2.5° C above pre-industrial levels by

210 0 , and still rising

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Sky 1.5 Accelerated decarbonisation now H ealth first – well-being is the priority
 People proceed cautiously, economies

reopen slowly but steadily Recognition of value in alignments
 G reen investment reshapes energy system Deep structural changes lower emissions
 1.5° C above pre-industrial levels thiscentury, in line with Paris goal

THE ENERGY TRANSFORMATION SCENARIOS
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8Energy demand rises in all scenarios
Total primary energy

Waves
Sky 1.5Islands
Historical data

Source: Shell analysis based on data from the IEA (2020) World Energy Balances ( Link), all rights reserved
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Achieving net-zero CO 2 emissions is in the 2050’s at the earliest

Source: Shell analysis based on data from Global Carbon Project (2020) and the IEA (2020) World Energy Balances (Link), all rights reserved

THE ENERGY TRANSFORMATION SCENARIOSCopyright of Shell International B.V. | February 2021

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Efficiency gains and system decarbonization are vital
Total final consumption of energy

THE ENERGY TRANSFORMATION SCENARIOS
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– Sky 1.5 scenario

Source: Shell analysis based on data from the IEA (2020) World Energy Balances, all rights reserved

11Electrification will grow in all scenarios, but particularly Sky 1.5
Share of electricity in final energy
Sky 1.5

50%

Waves

40%

Islands
Historical data

30%
20%
10%
0%
1980199020002010

PRE 2020
600 GW of solar installed in 2010s~ 150,000 3 MW turbines built during the 2010s, mainly onshore

No real growth since the turn of the century

2020

2030

2040

2050

2060

POST 2020
3000 GW of solar installed in 2020s
70,000 10 MW turbines during the 2020s, off-shore focus
Increase by a third in the coming decade and double by 2040.

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Oil demand will peak in the next two decades, but demand persists*Oil includes condensate and natural gas liquids
Source: Scenario ranges from Shell analysis based on data from the IEA (2020) World Energy Balances ( Link), all rights reserved
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Gas demand persists longer, but H2 and biogas could grow beyond 2050

Source: Scenario ranges from Shell analysis based on data from the IEA (2020) World Energy Balances ( Link), all rights reserved
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Comparing outlooks for hydrogen demand with the experience fromtwo successful emerging energy technologies: LNG and solar PV

Source: Shell analysis based on data from Rystad Energy and the IEA (2020) World Energy Balances ( Link), all rights reserved
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Both technological and natural sinks will be critical to achieving 1.5
Energy -related emissions captured by CCS

CO 2 removal using nature

Gt CO 2 /year

Gt CO 2 /year

10105500-5-5- 10- 10- 152000- 152000Waves

2020Islands2040

2060

Sky 1.52080

2100

2020

2040°C2060

2080

2100

Historical data

Source: Shell analysis, Global Carbon Project (2020)
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GENERATINGSHAREHOLDER VALUETHE SHELL INVESTMENT CASE

Growing value through a dynamic portfolio
and disciplined capital allocation

POWERING
PROGRESSRESPECTING NATURE
Protecting the environment, reducing waste andmaking a positive contribution to biodiversity

UNDERPINNED BYOUR CORE VALUESAND OUR FOCUS
ON SAFETY

Our strategy to accelerate thetransition to net-zero emissions,purposefully and profitably

P O W E R I N G LIVESPowering lives through our products and activities,
and supporting an inclusive society

ACHIEVING
NET -ZERO EMISSIONSWorking with our customers and sectors to accelerate
the energy transition to net-zero emissions

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Ccontact: report@tky.ieej.or.jp