Refining and Trading

Refining

We have interests in 15 refineries worldwide, after the completion of the sale of the Martinez refinery in February 2020. In recent years we have sought to unlock value by achieving closer integration with Shell Trading and Chemicals. We have operating hubs in Rotterdam, Singapore and the US Gulf Coast, and there are some structurally advantaged sites in other locations. Across our portfolio, Shell can process around 2.5 million barrels of crude oil a day into a wide range of products, including petrochemicals, gasoline, diesel, heating oil, aviation fuel, marine fuel, lubricants, LPG, sulphur and bitumen. Around 41% of our refining capacity is in the Americas, with 42% in Europe and Africa, and 17% in Asia and Oceania.

Our refineries can operate flexibly, allowing us to adjust what they make so we can sell the most economically advantageous mix of products. We are also investing in targeted projects at some of our refineries to further enhance our competitive edge.

Refining plays a key role in powering Shell’s global, customer-focused Downstream value chain. The flexibility, scale and geographic spread of our refining portfolio support Shell’s Trading and Supply business to competitively supply our Marketing businesses and external customers. Six of our refineries are deeply integrated with Shell’s stand-alone chemicals manufacturing sites. Five refineries also produce petrochemicals. This integration allows us to optimise how we use our resources. Our Norco and Deer Park refineries on the US Gulf Coast, for example, produce high-value oil products and provide secure, advantaged feedstocks for the nearby Shell-operated Geismar chemicals manufacturing plant.

Improvements in efficiency and operational reliability are helping to increase profitability and reduce CO₂ emissions. In Germany, we are building a power plant in our Rhineland refinery and chemicals complex that is expected to lead to a reduction of 100 thousand tonnes of CO₂ emissions per year. Residual heat from our Pernis integrated refining and chemicals complex in the Netherlands provides heat and hot water to 16 thousand homes in Rotterdam, allowing the city to reduce its GHG emissions by around 35 thousand tonnes a year.

We are also deploying advanced digital technologies across our refineries to help keep our equipment running safely and efficiently for longer. For example, we created a digital early warning system at our Pernis refinery that uses predictive analytics and machine-learning algorithms to monitor the status of valves in real time. Since coming online in late 2018, this digital early warning system has identified problems with two separate valves that our employees were able to fix, preventing unplanned downtime. If the valves had failed, Pernis would have experienced a material cost. We are replicating this technology across the portfolio, including at our Jurong Island manufacturing site in Singapore and at select upstream operations.

Trading and supply

Shell Trading and Supply is one of the largest energy trading operations in the world. This global organisation combines our network of trading companies, industry-leading shipping and maritime capabilities, and a network of supply and distribution activities, as integrator and optimiser.

Through our main trading offices in London, Houston, Singapore, Dubai and Rotterdam, we trade crude oil, natural gas, LNG, electricity, refined products, chemical feedstocks and environmental products. We have the experience and international scope to deliver sustained, growing cash returns by capitalising on trading opportunities inherent in Shell’s asset and market positions around the world.

Operating in around 30 countries, with more than 125 Shell and joint venture terminals, we believe our supply and distribution infrastructure is well positioned to make deliveries around the world. This includes supplying feedstocks for our refineries and chemical plants, and finished products such as gasoline, diesel and aviation fuel to our Marketing businesses and customers.

Our Shipping & Maritime business has a high level of expertise and decades of experience. It is responsible for ensuring that all our global maritime activities are safely managed, including a fleet of around 40 LNG carriers and 10 oil tankers. In addition, we typically have more than 230 oil and LNG vessels on time charter. There are around 2,000 vessels associated with Shell on the water on any given day, including the ships, barges, drilling rigs, supply boats, FPSOs, and floating storage and regasification units.

Our trading capability, deep market knowledge, global portfolio and end-to-end integration within Shell effectively create opportunities to deliver value for our customers and for Shell across our Upstream, Downstream and Integrated Gas businesses.