BRENT DELTA: Decommissioning Project Stakeholder Dialogue … · BRENT DELTA: Decommissioning...

BRENT DELTA:Decommissioning ProjectStakeholder Dialogue Sessions

29th June and 1st July 2010

(Shell is operator of the Brent Field for and on behalf of Shell U.K. Limitedand Esso Exploration and Production UK Limited)

Cautionary Statement

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 implied in 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’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’, ‘‘risks’’, ‘‘goals’’, ‘‘should’’ and similar terms and phrases. Also included as a forward looking statement is our disclosure of reserves, proved oil and gas reserves, proven mining reserves, organic reserves, net reserves and resources. 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 the Group’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market 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 effects arising from recategorisation of reserves; (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

2Copyright of Royal Dutch Shell plc

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 December 31, 2007 (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 June 29, 2010. Neither Royal Dutch Shell 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.

The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation that SEC's guidelines strictly prohibit us from including 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.

Also in this presentation we have aggregated our equity position in projects for both direct and indirect interest. For example, we have aggregated our indirect interest in the Pluto project via our 34% shareholding in Woodside Energy Ltd.

Date 29/06/2010 BRENT DELTA: Decommissioning Options

Project Status

Project status

Brent Delta well abandonmentwork continues

Brent Delta Topsides conceptselection studies completed

Brent Decommissioning ServicesContract process nearing completion

Topsides removal studies ongoing witha range of contractors


a range of contractors

Brent Delta GBS refloat technical studies completed

Brent Delta handover plan from operations to decommissioning constructed


Project Status (cont’d)

Project status

Brent Alpha, Bravo and Charlie decommissioning studies underway

Environmental and social impact assessment underway

Preparations for drafting the Decommissioning Programme (DP) underway- single DP to besubmitted to DECC


submitted to DECC

Projects in progress to study(1) Penguins evacuation and(2) Brent pipelines bypass

All four platforms remain currentlyin production. CoP dates remain uncertain.


Independent Review

Group (IRG) presentationGroup (IRG) presentation(Please refer to IRG page on the

Brent website for this presentation)

Brent Delta Topsides

Recommended proposal

Will be removed to shore for recycling(target 95% minimum recycling)

To be removed to shore either by:

Single lift

Series of heavy lifts

Final method subject to Front End Engineering and Design process (currently ongoing)


and Design process (currently ongoing)

Location for recycling - to be determined

Earliest Topsides removal: 2014/2015


Brent Delta – drill cuttings and debris

Recommended Proposal

Drill cuttings will be left undisturbed

� Complies with OSPAR Recommendation 2006/5

Unburied debris within 500m of each installation and 100m either side of pipelines will be removed where possible without cuttings disturbance.

Options rejected:

• Cell top cuttings

• Volume : 798m3

• Max Ht1 : 6.8m

• Seabed cutting

• Volume2 : 1,575m3

• Max Ht : 10.3m

Note:

1. Above reference elevation,

2.3m above cell tops

2. DTM surface relative to

reference datum level of –

143.4m.


Options rejected:

� Removal (e.g. by suction dredging)

Treatment on/offshore

� Capping of drill cuttings

� In situ treatment of cuttings

Why the recommended option?

� Least safety risk

� Least environment impact

� No disturbance of drill cuttingsFigure 7: Overall THC Persistence

(- Average scenario, --Minimum & Maximum for all scenarios predicted)

28/30 April 2009


Brent Delta Gravity Base Structures

Recommended Proposal: Leave in situ(derogation case)

Options not preferred:

� Refloat and inshore dismantling

� In situ dismantling

� Remove legs (partial removal)

Why leave structure in situ:

� Lowest safety risk



� Least environment footprint

� Refloat option carries a significantly higher risk of technical failure

Removal via refloat: significant riskand uncertainty around:

� Buoyancy

� Weight and its distribution

� Structural and watertight integrity

� Extraction from the seabed

� Installation of new systems


Souk session

Recommended Proposal: Leave in situ(derogation case)

Options not preferred:

� Refloat and inshore dismantling

� In situ dismantling

� Remove legs (partial removal)

Why leave structure in situ:


Gravity Base Structures (mini session)



� Least environment footprint

� Refloat option carries a significantly higher risk of technical failure

Removal via refloat: significant riskand uncertainty around:

� Buoyancy

� Weight and its distribution

� Structural and watertight integrity

� Extraction from the seabed

� Installation of new systems


Brent Delta Cell Contents

Status: Two concepts being studied

Concept 1

Remove attic oil

Remove water and interphase material- treat and dispose to sea

� Remove sediments, treat and disposedown an offshore waste disposal well

Concept 2

Attic Oil

InterphaseMaterial

Oil In andOutlet

Water

Water Inand Outlet

56m56m


Concept 2

Remove attic oil

Containment of water andinterphase material

� Containment or in situtreatment of sediments

- Target schedule for initial sampling Q3 2011 (highly dependent on equipment development lead time and suitable offshore weather)

UTILITYUTILITYSHAFTSHAFT

DRILLINGDRILLINGLEGLEG

and Outlet

Sediment

ConcreteSlab

Ballast

18m18m


Cell Concepts – where we are

Some concepts being / not being pursued furtherSediment

treatment

Recovery Desorption MNA Capping Incinerate Oxidise Bioreactor

Cell access

route

Small hole Large hole Medium

hole

Utility leg/

shaft

Sediment

disposal

Re-inject Leave in

place

Overboard

to sea

Recycle Onshore

Attic oil Free flow/ Emulsify Displace MNA* Capping


Attic oil

treatment

Free flow/

pump

Emulsify Displace MNA* Capping

Attic oil

disposal

Recycle Re-inject Onshore

Water

treatment

Cyclone GFU** MNA* Absorption Oxidise Clarify MBR*** MPPE****

Water phase

disposal

Re-inject Overboard

to sea

Leave in

place

Onshore

Facilities

location

Brent Delta

platform

Vessel

Sediment

Transport

Ship PipelineDo not

transport

* MNA: Monitored Natural Attenuation** GFU: Gas Flotation Unit*** MBR: Membrane Bio-Reactor**** MPPE: Micro Porous Polymer Extraction


Cell Remediation – some of the initial concepts

13 initial concepts were generated for evaluation

Utility Shaft Accessed Options

Bio-remediation (sediments + liquid contents)

Physical treatment (sediments + liquid contents)

In situ “Monitored Natural Attenuation” (MNA) (sediments + liquid contents)

In situ capping (sediments + liquid contents)

Remove to onshore (sediments + liquid contents)

Re-inject (sediments + liquid contents)


Re-inject (sediments + liquid contents)

Subsea Accessed Options

Re-inject after subsea removal (sediments + liquid contents)

Removal to onshore (sediments + liquid contents)

Fluid removal + in situ bio-remediation of sediments

Fluid removal + in-situ physical/chemical treatment of sediments

Fluid removal + in situ “Monitored Natural Attenuation” (MNA) of sediments

Fluid removal + in situ capping of sediments

Treat all on shore (sediments + liquid contents)


Cell Remediation – concepts retained

The concepts retained for closer evaluation included both removal and in situ options

• Removal options for both fluid + sediment:

� Re-inject after subsea removal (sediments + fluid contents):reinjection either on local platform or at hub platform in field

� Topsides treatment (sediments + fluid contents) with subsea removal

• In situ options for sediment post subsea fluid removal:


• In situ options for sediment post subsea fluid removal:

� “Monitored Natural Attenuation” (MNA) of sediments

� In situ capping of sediments


Monitored Natural Attenuation

Key uncertainties:� Volume of material

� Composition of material

Possible Strategy:� Access cells and remove attic oil

� Sample each cell to characterise sediments and establish volumes

NB: This slide featured only in the London presentation pack


Sample each cell to characterise sediments and establish volumes

� Complete bench top analyses of attenuation potential for sediment

� Verify conclusions of EIA (originally based on conservative assumptions, backed up by existing data)

� Establish expected attenuation curve as reference for future monitoring

� Develop “cocktail” of biological additives to aid attenuation process and inject into cells

� Remove topsides

� Monitor sediment over time

� Verify attenuation behaviour against expected attenuation curve


Remove and Reinject

Key Uncertainties� Volume of material

� Mobility of material

Possible Strategy:� Modify existing wells to be used as injectors

� Access cells and remove attic oil

NB: This slide featured only in the London presentation pack


� Use sonar to establish volumes

� Mobilise sediments using technology identified and tested onshore

� Recover mobilised sediments to topsides for possible treatment (volume reduction, milling of solids)

� Inject treated slurry in reinjection well(s)

� Establish volume of sediment unrecovered (sonar) and confirm agreed level of removal has been achieved

� Flush and clean remaining cell water to agreed standard

� Seal cells

� Remove topsides


Group exercise-

Cell remediation optionsCell remediation options

Cell Remediation – concept selection criteria

Primary assessment criteria and sub-criteria proposed for evaluating concepts for cell remediation

Primary criteria (as per DECC guidelines)

Health & safety

Environment

Sub-criteria

Comparative risk assessmentLong term health risk

Net CO2 emissions Operational riskResidual riskWaste balance


Technical

Societal

Economic

Application of technologyManagement of uncertaintyAdaptability

Other sea usersRegional developmentOnshore communities

Financial exposureImplementation costDevelopment cost


Way Forward

Statutory and public consultations

Secretary of State Approves DP

Decommissioning Execution

Decommissioning Programme (DP) Draft 2

DECC review and consultation with OSPAR –Shell submits separate Derogation Document

DECC formally requests submission of DP

Decommissioning Programme (DP) Draft 3

Note: The HSE will be a formal consultee as

part Decommissioning Programme process.

In addition the HSE will be consulted as part

of the Safety Case modification process.


Stakeholder dialogue session April 2009

Comparative assessments

Decommissioning Programme (DP) Prepared

Management review (Shell/XoM)

Decommissioning Programme (DP) Informal submission to DECC

Informal Review by DECC

DP Submission of Consultation Draft 1 to DECC

Statutory and public consultations

Stakeholder dialogue session - topic: final BD proposals (June/July ’10)

Earliest CoP dates, DECC agreement May 2009(BD Jan ’09, BA/BB May ’10, BC Jan’12)

We are here

June ‘10


Brent – Alpha, Bravo, Charlie, Delta

Brent Bravo Brent Charlie Brent Delta

Copyright of Royal Dutch Shell plc 22

Brent Alpha

Type:Platform, Steel

Topsides weight :16,500 gross /15,500 (dry ) tonnes

Jacket weight:14,300 tonnes (excl. piles)

Number of storage cells: n/a

Well slots: 28

Differences

Steel structureNo oil storage

Brent Bravo

Type: Platform, Concrete,Gravity based

Topsides weight: 24,100 gross /23,100 (net) tonnes

GBS weight: 331,300 tonnes

Number of storage cells:16

Well slots:38

Differences

Concrete structureGravity based structure with oil and water storage cells

Brent Charlie

Type:Platform, Concrete,Gravity based

Topsides weight:31,000 gross /30,000 (net) tonnes

GBS weight:290,000 tonnes


Well slots:40

Differences


Brent Delta

Type:Platform, Concrete,Gravity based

Topsides weight: 23,500 gross /22,500 (net) tonnes

GBS weight: 300,900 tonnes


Well slots:48

Differences



Jan

Stakeholder dialogue events

Nov

General project update

GBS storage cellsampling + remediation (BD)

Q4 2

00

7

Q1 2

00

8

Q2 2

00

8

Q3 2

00

8

Q4 2

00

8

Q1 2

00

9

Q2 2

00

9

Q3 2

00

9

Q4 2

00

9

Q1 2

01

0

Q2 2

01

0

Q3 2

01

0

Q4 2

01

0

Q1 2

01

1

Q2

20

11

Q2 2

00

7

Q3 2

007

Q1 2

00

7

General introduction-dialogue session kick-off

Copyright of Royal Dutch Shell plc 23

Apr

Sept

General project update+ drill cuttings+ waste (BD)

General project update+ focus on GBS decommissioning (BD)

Routine dialogue meetings with some stakeholders

Output/conclusions of studies + comparative assessments (BD)

Output/conclusions of studies + comparative assessments (BA/BB/BC)

Jun/July

Date tbc


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