Delivered at the Global CCS Institute's Global Status of CCS: 2013 event in Seoul, 10 October 2013.

1. ROLE OF CCS IN TACKLING CLIMATE
CHANGE AND ENSURING ENERGY
SECURITY
Presentation at:
The Global Status of CCS
Global CCS Institute
Seoul, October 9-11, 2013
Quest construction
Scotford, Alberta
Tim Bertels
Manager CCS Portfolio,
Shell Global Solutions
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2. Disclaimer Statement
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 or SEC proven
mining reserves. Resources are consistent with the Society of Petroleum engineers 2P and 2C definitions.
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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 in which Royal Dutch Shell
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 which Shell has
significant influence but not control are referred to as “associated companies” or “associates” and companies in which Shell has joint control are referred to as “jointly
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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 and regulatory developments including potential litigation and regulatory measures as a result of
climate changes; (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. 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 factors that may affect future results are contained in Royal Dutch
Shell’s 20-F for the year ended 31 December, 2012 (available at www.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 this presentation, 10th October 2013. Neither Royal Dutch Shell nor any of its subsidiaries undertake any
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in filings 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. You can
also obtain these forms from the SEC by calling 1-800-SEC-0330.
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3. IN 2050, FOSSIL FUELS
COULD STILL MEET
AROUND 60% OF
WORLD ENERGY
DEMAND
Copyright of Royal Dutch Shell Plc
3

4. MUST AVOID THE TRILLIONTH TON OF CO2 TO STAY BELOW 20 C
1 trillion tonnes
0.8
~2°C
0.6
. . . well over half full today.
2000-2012
0.4
1950-1999
0.2
1900-1949
Starting in
1750
0
1850-1899
1800-1849
Reference:
Warming caused by cumulative carbon emissions towards the trillionth tonne. Myles R. Allen, Malte Meinshausen et. al. Nature Vol 458, 30 April 2009
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5. THE CLIMATE ISSUE IS A “STOCK” PROBLEM
. . and using current proven1 fossil reserves2 takes us well over the mark.
Early 2040’s
~4°C
2000-2012
~3°C
1950-1999
1900-1949
Starting in
1750
1 BP
2
1.6 trillion
tonnes, with
continued
land use
change and
cement
production
. . . . . and
probably still
rising later
in the
century.
1850-1899
1800-1849
Statistical Review of World Energy
Current reserves of oil and gas are ~60 years each, coal ~110 years at current usage rates
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6. IF THIS IS ALL THE COAL, GAS AND OIL THAT WE CAN USE . . .
2000-2012
1950-1999
1900-1949
Starting in
1750
1850-1899
1800-1849
About 425 billion tonnes carbon
or
About 1.5 trillion tonnes CO2
or
Less than 40 years at current rates
or
Just 30 years at BAU rates
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7. . . . THEN ENERGY DEMAND WILL NOT BE MET OVER
THE CENTURY (despite rapid renewable energy growth)
Lowest
possible
emissions
Source: Shell “Oceans” Scenario
Available stock
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8. SO HOW CAN WE LIMIT THE TEMPERATURE RISE?
Plants
Minerals
Oceans
CO2
Capture &
Storage
There are a limited number of ways to reduce CO2
Copyright of Royal Dutch Shell Plc
8

9. THE SHELL SCENARIOS SHOW LARGE POTENTIAL FOR CCS
25
Oceans
Mountains
CO2 Stored, GT per annum
20
15
10
5
0
2010
2020
2030
2040
2050
2060
2070
2080
2090
2100
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10. Mountains - A GAS “BACKBONE” WITH EARLY AND RAPID
DEPLOYMENT OF CCS LIMITS THE STOCK
Late 2040’s
2000-2012
1950-1999
Capped
by ~2100
1900-1949
Starting in
1750
1850-1899
1800-1849
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11. CCS ALSO ENABLES COMPETITIVE LOW CARBON ENERGY
US$ per MWhr
250
200
150
100
Natural Gas Fired Plant
50
0
*Levelised cost of electricity of low-carbon technologies and conventional power generation – as presented in ‘The costs of CCS
and other low-carbon technologies’ Global CCS Institute.
Copyright of Royal Dutch Shell Plc
11

12. BUT WHAT IF WE WOULD NOT HAVE CCS AVAILABLE . . .
US$ per MWhr
250
200
150
100
50
0
*Levelised cost of electricity of low-carbon technologies and conventional power generation – as presented in ‘The costs of CCS
and other low-carbon technologies’ Global CCS Institute.
Copyright of Royal Dutch Shell Plc
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13. WITHOUT CCS IT WILL COST SOCIETY MORE TO DECARBONISE
$1
Trillion
A global delay in CCS
deployment would cause an
increase of power sector
decarbonisation by $1Trillion
IEA 2013
Copyright of Royal Dutch Shell Plc
32
Billion
£/Annum
Without CCS, the additional
costs to run a decarbonised
UK economy in 2050 will be
£32Billion.
40%
Without CCS, the IEA reports
costs to halve emissions by
2050 will be 40% higher.
UK Energies Technology Institute
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14. BUT WE MUST GO THROUGH THE LEARNING CURVE
First of a Kind (FOAK)
Nth of a Kind (NOAK)
Cost of each phone
Carbon Capture & Storage
Wind & Solar
Gas Fired Power
Total number of phones ever built
Copyright of Royal Dutch Shell Plc
Credit; http://itsasmallweb.files.wordpress.com/2011/02/3.jpg
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15. SHELL’S PORTFOLIO APPROACH TO CCS DEMONSTRATION
TCM
Quest
Peterhead
Boundary Dam
Shell involvement in CCS Projects;
Industrial scale projects in operation
Gorgon
Industrial scale projects in construction
Planned industrial scale project (pre-FEED)
Involvement through Shell Cansolv Technology
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16. ALSO IN SHELL SEVERAL PROJECTS DIDN’T MAKE IT
1. Barendrecht

4. ZeroGen

5. Longannet

7. TCM
3. Boundary Dam
2. Draugen

6. Gorgon

9. Peterhead
8. Quest



No Final Investment
Decision Yet
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17. CRITICAL ENABLERS FOR CCS
1. It is good for Government
2. It is good for Industry
Licence to
Operate
3. It is good for the constituents
4. Enabling legislation exists
5. Clear liability agreement
6. Financial support for demonstration
Build with
Confidence
7. Early adopter benefits
8. Trust & Certainty
9. Knowledge sharing
Replication
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18. CCS WILL REQUIRE FINANCIAL SUPPORT FOR
DEMONSTRATION – EFFECTIVE POLICIES NEEDED
Objective – to provide adequate
support to demonstrate CCS and
reduce costs from FOAK to NOAK to
deliver a competitive and viable
technology in a decarbonised world.
Nth OF A KIND
FIRST OF A KIND
DEVELOPMENT
DEMONSTRATION
DEPLOYMENT
Capital grants (supports build)
Opex support (ensures plant operates)
Robust CO₂ price
... plus other temporary measures (e.g. CCS certificates?) if
the uptake rate continues to be disappointing ....
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19. KEY MESSAGES
• The climate issue is a “stock” problem and rapid
deployment of CCS limits the stock of CO2
• In most scenarios fossil fuels will meet around 60% of
world energy demand by 2050; CCS is essential to ensure
energy security in a decarbonised world
• CCS deployment requires a robust CO2 price, meanwhile
demonstration projects need capital grants, opex support
and other temporary measures
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