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SHELL LNG OUTLOOK 2018

DEFINITIONS & CAUTIONARY NOTE
Reserves: Our use of the term “reserves” in this presentation means SEC proved oil and gas reserves. Resources: Our use of the term “resources” in this presentation includes quantities of oil and gas not yet classified as SEC proved oil and gas reserves. Resources are consistent with
the Society of Petroleum Engineers (SPE) 2P + 2C definitions.
Operating costs are defined as underlying operating expenses, which are operating expenses less identified items. Organic free cash flow is defined as free cash flow excluding inorganic capital investment and divestment proceeds. Clean CCS ROACE (Return on Average Capital
Employed) is defined as defined as the sum of CCS earnings attributable to shareholders excluding identified items for the current and previous three quarters, as a percentage of the average capital employed for the same period. Capital employed consists of total equity, current
debt and non-current debt. Capital investment comprises capital expenditure, exploration expense excluding well write-offs, new investments in joint ventures and associates, new finance leases and investments in Integrated Gas, Upstream and Downstream securities, all of which onan accruals basis. In 2016, the capital investment was impacted by the acquisition of BG Group plc. which are included in “Change in non-controlling interest” within “Cash flow from financing (CFFF) activities”. Divestments comprises proceeds from sale of property, plant andequipment and businesses, joint ventures and associates, and other Integrated Gas, Upstream and Downstream investments, reported in “Cash flow from investing activities (CFFI)”, adjusted onto an accruals basis and for any share consideration received or contingent consideration
recognised upon divestment, as well as proceeds from the sale of interests in entities while retaining control (for example, proceeds from sale of interest in Shell Midstream Partners, L.P.), This presentation contains the following forward-looking Non-GAAP measures: Organic Free
Cash Flow, Free Cash Flow, Capital Investment, CCS Earnings, CCS Earnings less identified items, Gearing, Underlying Operating Expenses, ROACE, Capital Employed and Divestments. We are unable to provide a reconciliation of the above forward-looking Non-GAAP measures
to the most comparable GAAP financial measures because certain information needed to reconcile the above Non-GAAP measure to the most comparable GAAP financial measure is dependent on future events some which are outside the control of the company, such as oil andgas prices, interest rates and exchange rates. Moreover, estimating such GAAP measures consistent with the company accounting policies and the required precision necessary to provide a meaningful reconciliation is extremely difficult and could not be accomplished without
unreasonable effort. Non-GAAP measures in respect of future periods which cannot be reconciled to the most comparable GAAP financial measure are calculated in a manner which is consistent with the accounting policies applied in Royal Dutch Shell plc’s financial statements. The
financial measures provided by strategic themes represent a notional allocation of ROACE, capital employed, capital investment, free cash flow, organic free cash flow and underlying operating expenses of Shell’s strategic themes. Shell’s segment reporting under IFRS 8 remains
Integrated Gas, Upstream, Downstream and Corporate.
The companies in which Royal Dutch Shell plc directly and indirectly owns investments 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 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 by identifying the particular company or companies. ‘‘Subsidiaries’’,“Shell subsidiaries” and “Shell companies” as used in this presentation refer to companies 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 “joint ventures”
and “joint operations” respectively. 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 Shell in a
venture, partnership or company, after exclusion of all third-party interest.
This presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking
statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or impliedin these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell 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’’, “schedule”, ‘‘seek’’, ‘‘should’’, ‘‘target’’,‘‘will’’ and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this presentation, 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 industry competition; (g) environmental and physical 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 to international sanctions; (j) legislative, fiscal andregulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental
entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking
statements contained in this presentation are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional risk factors that may affect future results arecontained in Royal Dutch Shell’s 20-F for the year ended December 31, 2016 (available at www.shell.com/investor and www.sec.gov ). These risk factors also expressly qualify all forward looking statements contained in this presentation and should be considered by the reader.
Each forward-looking statement speaks only as of the date of this presentation, March 15, 2018. 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 materially from those stated, implied or inferred from the forward-looking statements contained in this presentation. This presentation may contain references to Shell’s website. These references are for the readers’convenience only. Shell is not incorporating by reference any information posted on www.shell.com. We may have used certain terms, such as resources, in this presentation that United States Securities and Exchange Commission (SEC) strictly prohibits us from including in ourfilings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.

Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

OVERVIEW

Queensland Curtis LNG Facility, Australia

01

02

03

EXTERNAL ENVIRONMENTCREATING MORE OPPORTUNITIESFOR GAS AND LNG

STRONG LNG
FUNDAMENTALS EXCEEDEDEXPECTATIONS IN 2017

SUPPLY INVESTMENTREQUIRED TO MEET
LONG-TERM DEMANDGROWTHRoyal Dutch Shell plc

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SHELL LNG OUTLOOK 201801

EXTERNAL
ENVIRONMENTCREATING MOREOPPORTUNITIES FORGAS AND LNG

Royal Dutch Shell plc

Oman LNG facility

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

THE ENERGY CHALLENGE

Growing
Population

RisingDemandOngoing
SupplyMitigating
Climate Change

Improving Air
Quality

According to the World
Bank, global population is
expected to increase fromaround 7 billion today toover 9 billion by 2050,
with 66% living in cities.

Over a billion people continue
to live without electricity while
another billion struggle withunreliable supplies of electricity.
According to the International
Energy Agency (IEA) New
Policies Scenario, global
energy demand is expected to
grow by 30% between 2015
and 2040.

As per IEA, it is expectedthat renewable energy could
increase significantly by
2040. However, we will stillneed large amounts of oil
and gas to provide the fullrange of energy productsthat the world needs.

The world currently emits
32 billion tonnes ofenergy-related CO2 eachyear. To limit the rise inglobal temperature to 2°C,
the IEA has calculated thatenergy related CO2
emissions need to fall toaround 18 billion tonnes a
year by 2040.

The World HealthOrganization (WHO) has
found that outdoor air
pollution in both cities andrural areas is estimated tocause some 3 million
premature deaths a year
worldwide.

Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

GROWING ECONOMIES NEED MORE AND CLEANER ENERGY

Air quality index 2017

Energy demand growth vs coal share
Change in energy demand (2017-2035), KTOE
800,000

India
600,000

China

400,000

200,000
Pakistan
Bangladesh
Myanmar0
0%

Thailand25%

VietnamSouth Korea
50%

Asia air quality index
ExtremeHigh
MediumPopulation size

75%

100%

Coal share in electricity mix (2017)
Source: Shell interpretation of Wood Mackenzie and Verisk Maplecroft Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

POLICY ACTIONS FOR CLEAN ENERGY SUPPORT GAS AND LNG

GLOBALREGIONAL

NATIONAL

LOCAL

Increasing recognition ofenvironmental benefits

EU policies supporting
coal phase out

Policies favour gas andrenewables

Policymakers targeting
air quality

More than 10 countries
announce coal phase-out
ambitions - 25% of coal
power capacity in EU

China reforms gas market toincrease competitiveness ofdelivered gas

Berlin closes local coal-fired
power plants to improve air
qualitySouth Korea’s 8th Basic Plan for
Energy prioritises renewables
and gas, while not sanctioning
new nuclear and coal

Beijing meets ambitious
2017 air quality targets,
supported by coal to gas
switchingG20 endorses the role ofnatural gas in energy
transition
IEA credits levelling of global
CO2 emissions to coaldisplacement

Royal Dutch Shell plc

EU confirms reforms tostrengthen EU Emissions
Trading Scheme

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

GAS PLAYS GROWING ROLE TO MEET ENERGY CHALLENGE

Global energy demand growth by fuel
BCM

BCM

20,00016,00046%

10% 7%
18% 14%

6%

45%

27%

20%

1% CAGR

2,000

7%

5,000
33%

4,000

3,000

Energy demand:

Global gas demand growth by region
BCM

5,000
4,000

12,0008,000

Global gas demand growth by sector

Gas demand:
2% CAGR

2,000

1,000

1,000

0

0

0

Royal Dutch Shell plc

2%

13%

38%

3,000

4,000

Source: Shell interpretation of Wood Mackenzie Q4 2017 data

14%

Asia gas demand:
3% CAGRCAGR - Compound Annual Growth Rate
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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

GAS SUPPORTS RENEWABLES

Flexible gas generation complements solar to provide
reliable power generation in California

Flexible LNG supply balances hydro generation to provide
reliable power in Brazil
BCM/Month

Net load, MWhReservoir level30,000100%

1.00

25,00075%

0.75

20,00050%

0.50

15,00025%

0.25

10,000

0%

0.00

0

4

8

12

16

20

24

Hour of the day
Mar-13Mar-17Net load equals total generation minus solar and wind output; 7 day sample

North & South hydro reservoir levels (LHS)

LNG imports (RHS)

Source: Shell interpretation of Wood Mackenzie Q4 2017, IHS Markit and CAISO data

Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

OECD LEADING THE MOVE TO GAS AND RENEWABLES FOR POWER
GENERATION
Non-OECD electricity output by source

OECD electricity output by source
Share

Share

60%

60%

50%

50%

40%

40%

30%

30%

20%

20%

10%

10%

0%
1975

0%
1980
1985
Natural Gas

Hydro

1990

1995
Coal

2000

2005
2010
Nuclear

Other renewables

Oil

2015

Biofuels and waste

1975

1980

1985

1990

1995

2000

2005

2010

2015

Natural gas

Coal

Nuclear

Hydro

Other renewables

Biofuels and waste

Oil

Source: Shell interpretation of International Energy Agency (IEA) data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

STRONG CHINA GAS DEMAND DRIVEN BY GROWTH OUTSIDE POWER

China gas demand

China demand growth by sector, 2017

BCMA

BCM

BCM

250

50

250

200

40

240

150

30

230

100

20

220

50

10

210

0

0

200

2001

2003

2005

2007

Gas demand (LHS)

2009

2011

2013

2015

2017

2016

Electricity

Industrial Res, comm Transport& heat2017

Change YoY (RHS)

Source: Shell interpretation of IHS Markit, China National Bureau of Statistics and Chinese customs data; latest estimates for 2017
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

LNG IS THE FASTEST GROWING GAS SUPPLY SOURCE

Global gas supply by source

LNG imports by region
BCM

BCM
5,000

1,000

31%
62%

7%

4,000

800

15%

13%

16%

3,000

600

LNG demand:

2,000

400

4% CAGR

1,000
0

55%

200

2017

Domestic
production

Pipeline
imports

Source: Shell interpretation of Wood Mackenzie Q4 2017 data
Royal Dutch Shell plc

LNG imports

2035

0

2017

Asia

EuropeAmericas Middle East
& Africa

2035

CAGR - Compound Annual Growth Rate
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SHELL LNG OUTLOOK 2018

EXTERNAL ENVIRONMENT CREATING MORE OPPORTUNITIES FOR GAS AND LNG

LNG PROVIDES NEW FORM OF ENERGY SECURITY

Queensland Curtis LNG Facility, Australia

LNG SOLVES GAS MARKET UNCERTAINTIES:

▪
▪
▪
▪
▪

Declining domestic production
Pipeline disruptions
Falling nuclear utilisation and reliability
Hydroelectric seasonality, renewable intermittency

Weather disruptions

Royal Dutch Shell plc

LNG RESILIENT TO ITS OWN UNCERTAINTIES:

▪
▪
▪
▪
▪

Geopolitics
Timing of new supply
Existing plant output
Changing trade patterns
Gas supply and demand uncertainty

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SHELL LNG OUTLOOK 201802

STRONG LNG
FUNDAMENTALSEXCEEDEDEXPECTATIONSIN 2017

Royal Dutch Shell plc

LNG bunker vessel ‘Cardissa’

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

UNPRECEDENTED LNG CAPACITY EXPANSION 45% COMPLETE

LNG trade

LNG liquefaction capacity additions
MTPA (FOB)

MTPA (DES)

50
40

100%

400

75%

300

50%

200

25%

100

0%

0

293

30
20

10
0
2015

2016

2017

Nameplate capacity additions

2018

2019

2020

2005

2007

2009

2011

2013

2015

2017

2019

Share online (nameplate capacity)

Source: Shell interpretation of IHS Markit Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

GLOBAL LNG MARKET CONTINUES TO DEFY EXPECTATIONSNet exports: 2017 YoY

Net imports: 2017 YoY
Million tonnes (DES)

Million tonnes (DES)
30

30

20

20

10

10

0

0

-10

-10

Total exports

Australia

US

AfricaPrevious consensus forecast (as of late 2016)

Rest of world

Actuals

Total imports

North Asia

South Europe Rest of world

Previous consensus forecast (as of late 2016)

North West
EuropeActuals

Source: Shell interpretation of IHS Markit, Wood Mackenzie and Poten & Partners 2016 and Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

29 MT INCREASE IN LNG IMPORTS IN 2017

Net imports: 2017 YoY

Million tonnes (DES)
16

Previous consensus forecast (as of late 2016)

Actuals

12
8

China

Korea

TurkeySpain

FrancePakistan

TaiwanItaly

Portugal

India

MexicoThailand

GreeceKuwaitMalaysia

PolandNetherlands

Malta

BrazilSingapore

IsraelDom Rep

JordanJamaica

Japan

Chile

CanadaBelgium

FinlandSwedenColombia

NorwayUS

Lithuania

Puerto RicoArgentina

Indonesia

-4

UAE

Egypt

0

UK

4

Source: Shell interpretation of IHS Markit, Wood Mackenzie and Poten & Partners data 2016 and Q4 2017
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

LNG ACCOMMODATES CHINA GROWTH AND SEASONAL DEMAND

Demand seasonality

China LNG imports
Million tonnes

Share of cargoes

40

100%
80%

30

60%
20
40%
10

20%

0

0%
2010

2011

2012

LNG imports

2013

2014

2015

2016

Contracted LNG supply2017

Jan-16China
Other Europe

Jul-16

Jan-17
Japan, Korea, Taiwan
North West Europe

Jul-17
Rest of World

Source: Shell interpretation of IHS Markit Q4 2017, S&P Global Platts, ICE data and Wood Mackenzie Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

SPOT PRICES CONTINUE TO REFLECT STRONG DEMAND FOR LNG

Global energy prices

Asian spot price$/MMBTU

JKM as % Brent

25

25%

20

20%

15

15%

10

10%

5

5%

0

0%

2010

2011

2012

Energy price range
NBP
Coal (ARA)

2013

2014

Henry Hub
JKM (Platts)

2015

2016

2017

2018

Brent
Japan LNG ImportJan

Feb Mar Apr May Jun
Range 2010-2015

Jul

Aug Sep Oct Nov Dec
2016

2017

Source: Japanese customs data (Japan LNG import), S&P Global Platts (JKM), ICE (NBP, Brent, ARA coal), NYMEX (Henry Hub)Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

PHYSICAL AND FINANCIAL LIQUIDITY INCREASE AS MARKET EVOLVES

Spot LNG supply

Spot LNG deliveries
Share spot

CargoesCargoes

ICE JKM LNG (Platts) futures
Share spot

Cargoes

Lots (10,000 MMBTU)

27,000

400

10%

400

10%

60

18,000

200

5%

200

5%

30

9,000

0

0%

0

0%

0

0

US

Qatar

Other

Re-exports% spot (RHS)

JKT
Middle East
% spot (RHS)

2011

Australia

China
Europe

2017

90

2016

15%

2015

600

2014

15%

2013

600

2012

36,000

2011

120

2010

20%

2017

800

2016

20%

2015

800

2014

45,000

2013

150

2012

25%

2010

1000

2017

25%

2016

1000

2015

54,000

2014

180

2013

30%

2012

1200

2011

30%

2010

1200

South Asia
Americas

Source: Shell interpretation of IHS Markit Q4 2017, S&P Global Platts and the ICE data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

FAST, FLEXIBLE FSRUs CONTINUE TO INCREASE LNG IMPORTS

Deliveries to FSRUs
MTPA

FSRU share

10

4%

5

2%

0

0%

Americas

EuropeAsia

FSRU share

2017

6%

2016

15

2015

8%

2014

20

2013

10%

2012

25

2011

12%

2010

30

2009

14%

2008

35

ME & Africa

FSRU picture to be added

FSRU moored off the port of Aqaba in Jordan

FSRU importing markets
Under Construction & Development

ExistingArgentina 
Brazil
China
Colombia 

EgyptIndonesia 
Israel
Italy


Jamaica 
Jordan
Kuwait
Lithuania 

MaltaPakistan
Turkey
UAE






Bahrain Russia
Bangladesh  Panama
Chile
Ghana

Proposed

Croatia
 Ivory Coast
Cyprus South Africa
El Salvador  Sri Lanka
Hong Kong

Source: Shell interpretation of IHS Markit Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

STRONG LNG FUNDAMENTALS EXCEEDED EXPECTATIONS IN 2017

DEMAND FOR LNG IN TRANSPORT GROWS GLOBALLY Diverse marine

segments choosing LNG

 LNG bunkering network

developing globally

 LNG road fuelling network

developing in China (2000+ stations)and EU (100+ stations)Container Ship

Cruise Ship

TankerLNG Fuel Station

Barge

Car Carrier

Ferry

LNG Heavy Duty Truck
truck

Royal Dutch Shell plc

22

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SHELL LNG OUTLOOK 201803

SUPPLYINVESTMENTREQUIRED TO
MEET LONG-TERM
DEMANDGROWTHRoyal Dutch Shell plc

23

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SHELL LNG OUTLOOK 2018

SUPPLY INVESTMENT REQUIRED TO MEET LONG-TERM DEMAND GROWTHLACK OF SUPPLY INVESTMENT RISKS FUTURE GLOBAL LNG MARKETGROWTH
Emerging LNG supply-demand gap

Investment in liquefaction capacity

MTPA (DES)MTPA (FOB)

600

40

500

30
400

20

300
200

10
100
0
2000

2005

2010

LNG supply in operation

2015

2020

2025

LNG supply under construction

2030

2035

Demand forecasts

02008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Year of investment decision

Source: Shell interpretation of IHS Markit, Wood Mackenzie, FGE, BNEF and Poten & Partners Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

SUPPLY INVESTMENT REQUIRED TO MEET LONG-TERM DEMAND GROWTH

LNG BUYERS AND THEIR NEEDS ARE CHANGING

Drivers of LNG demand

LNG buyers’ domestic gas competition

MTPA (DES)600

Share of LNG deliveries
100%

500

80%

400

60%

300
40%

200
100

20%

0

0%

2000

2005

2010

Other market drivers

2015

2020

2025

2030

2035

Declining domestic gas production

2010
Traditional markets

2017
Liquid or liberalising markets

Source: Shell interpretation of Wood Mackenzie Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

SUPPLY INVESTMENT REQUIRED TO MEET LONG-TERM DEMAND GROWTH

LNG BUYERS SIGNING SHORTER AND SMALLER CONTRACTS

A-rated

B-rated

2017

2016

2015

2012

2011

2010

2009

2008

2017

2016

0%

2015

0.0
2014

0

2013

20%

2012

0.5

2011

4

2010

40%

2009

1.0

2008

8

2017

60%

2016

1.5

2015

12

2014

80%

2013

2.0

2012

16

2011

2.5

2010

20

Share of contract volume
100%

2009

MTPA

2008

Years

2014

New long-term contract credit rating

Average contract volume

2013

Average contract length

Non-investment grade

Investment grade
Source: Shell interpretation of IHS Markit Q4 2017, Moody’s and Fitch data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

SUPPLY INVESTMENT REQUIRED TO MEET LONG-TERM DEMAND GROWTH

LIQUEFACTION INVESTMENT NEEDED TO MEET DEMAND GROWTH

Term sales to importers by supplier type
Share of total contract volume

STALEMATE CONSTRAINING GROWTH OF LNG SUPPLY

100%
80%
60%

FINANCIERS
Look to ensure
revenuecertainty

40%
20%
0%
2008-2010

Supply project

2015-2017

Portfolio

Trader

LNG PRODUCERS
Seek long-term
LNG sales tosecure financing

MISMATCH
BETWEEN
BUYER
AND
SELLERNEEDS

LNG BUYERS
Seek smaller,
more flexible
purchases toremaincompetitive indownstream
market

END-USERS
Look to avoid
long-term
contracts thatare not in linewith theircompetitive
positionIntermediaries
Source: Shell interpretation of IHS Markit Q4 2017 data
Royal Dutch Shell plc

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SHELL LNG OUTLOOK 2018

SUMMARY

External environment creating more opportunities for gas and LNG▪ Multiple levels of policy support gas and LNG demand▪ Gas supports renewable power generation and provides cleaner
non-power energy supply
Strong LNG fundamentals exceeded expectations in 2017▪ 11 % increase in LNG imports▪ Physical and financial liquidity increases as market evolves
Supply investment required to meet long-term demand growthRoyal Dutch Shell plc

Methane Shirley Elisabeth

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