Downstream overview

In 2015, our Downstream business

  • Achieved the highest CCS earnings excluding identified items ($9.7 billion) since the inception of Downstream more than 10 years ago, despite a reduced portfolio base. Refining earnings were particularly strong, driven by higher industry margins and improved availability in 2015.
  • Return on average capital employed topped 20% for 2015; the highest since the end 2005 driven in part by strong earnings.
  • We took three final investment decisions in Downstream to:
    • add 425 thousand tonnes per year of alpha olefins production capacity at Geismar, Louisiana, USA.
    • proceed with the debottlenecking project at Scotford refinery, Canada.
    • build a solvent deasphalter unit at the Pernis refinery, the Netherlands.
  • Announced the divestment of our 33.24% holding in Showa Shell in Japan to Idemitsu for approximately $1.4 billion. We will retain a 1.80% interest, with completion expected in 2016.
  • Sold additional interests in Shell Midstream Partners, L.P., in the USA, to public investors via the issuance of limited partnership units, reducing our interest in the partnership to 60% and generating proceeds of $595 million.

So far in 2016

  • In the Chemicals business we took the FID on expansion of our existing joint venture with China National Offshore Oil Corporation (CNOOC) in Guangdong province, China. The heads of agreement was signed in 2015.
  • In 2016, we took the FID to build a major petrochemicals complex, near Pittsburgh, Pennsylvania, USA.
  • Signed a non-binding letter of intent with Saudi Aramco (SA) to discontinue the Motiva joint venture in the USA. Motiva’s assets will be divided between Shell and SA.
  • Also in the USA, we sold additional interests in Shell Midstream Partners, L.P., reducing our interest to 54% and generating proceeds of $421 million.

Downstream – key statistics

 

2015

2014

2013

2012

2011

[A]

With effect from 2015, refinery availability includes Shell-operated process units only. Comparative data has been restated.

($ million), of which:

10,243

3,411

3,869

5,382

4,170

Oil products

8,654

1,994

2,026

4,008

2,136

Chemicals

1,589

1,417

1,843

1,374

2,034

CCS earnings excluding identified items ($ million)

9,748

6,265

4,466

5,343

4,155

Cash flow from operations ($ million)

14,076

11,292

7,903

11,111

4,921

Oil products sales volumes (thousand )

6,432

6,365

6,164

6,235

6,196

Chemicals sales volumes (thousand tonnes)

17,148

17,008

17,386

18,669

18,831

Refinery processing intake (thousand b/d)

2,805

2,903

2,915

2,819

2,845

Refinery availability (%) [A]

90

93

94

92

90

Chemical plant availability (%)

85

85

92

91

89

Capital investment ($ million)

5,119

5,910

5,528

5,454

7,548

Capital employed ($ million)

46,280

48,925

64,507

62,426

64,237

Employees (thousands)

43

47

48

48

51

Downstream CCS earnings and cash flow from operations [A]

$ billion

Downstream CCS earnings and Cash flow from operations for Oil products, Chemicals and Cash from operations (in $ billion) – development from 2011 to 2015 (bar and line chart)Downstream CCS earnings and Cash flow from operations for Oil products, Chemicals and Cash from operations (in $ billion) – development from 2011 to 2015 (bar and line chart)

[A] excluding identified items.

Downstream capital investment

$ billion

Downstream capital investment for Asset integrity and Growth (in $ billion) – development from 2013 to 2015 (bar chart)Downstream capital investment for Asset integrity and Growth (in $ billion) – development from 2013 to 2015 (bar chart)
CCS earnings
earnings on a current cost of supplies basis
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b(/d)
barrels (per day)
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CCS earnings
earnings on a current cost of supplies basis
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