LNG Technology Platform

An Overview

LNG

LMR

HMR

LMR bleed

NG Q

KT

C3 C2 C1 N2

HMR bleed
C3

Copyright of Shell International CONFIDENTIAL

 A compact LNG technology team integrated in PTD/I
One Center of Excellence for LNG (projects, asset support and technology).

Regas projects LNG/IG projects Assets

Production
excellence
Project devt
teams IG program
office Asset
Regas core support
team teams LNG Asset
support BRNC

T&I
Upstream T&I Assets Projects T&I
TRT Market Basic GHG
access Data mgt Share point
LNG Technology Platform LNG CoE Knowledge mtg
Market access
Projects
Upstream Assets CVP Modelling and SIGN
tools
platforms portal
SPOA
GLUG
Copyright of Shell International
IP Technical CI
Licensing CONFIDENTIAL
2
Fully Aligned with IG Business Priorities
1 CASH & RETURNS
Current Outlook: ~40 mpta, ~15 bln$ CFFO
Goal: Close Gap-to-potential > 1 bln$/yr (SS)
Areas of Opportunity:
 Eliminate threats to reliability & availability
 Maximize Utilization, Secure upstream gas
 Minimize turnaround duration and intervals
 Reduce exposure: Process control, automation
 Enable Top Quartile UOC & CO2 performance
Technology levers:
 High capacity dehydration increasing TA
intervals to 6 years ($40 Mln NPV)
 Real Time Production Optimization1-2% more
average production ($ 265 Mln)
 Air Cooled Heat Exchanger performance,
1% increase ($265 Mln)
Copyright of Shell International
Overview
2 DEMAND
Current Outlook: ~50 mtpa by 2030
Goal: Lower REGAS cost & enable LNG4T
Areas of Opportunity:
 Improve acceptability of LNG as fuel.
 Proactively address methane emissions
 Fast/affordable small-scale Regas & Shipping
 Identify and close Process Safety gaps
 Reduce costs across LNG for Transport chain
Technology levers:
 Truck and shipping low cost LNG storage
 Jettyless LNG cutting civil works (~100 $Mln)
 LNG engine performance, and oxidation
catalyst development to eliminate methane slip
 SuperCool LNG minimize BOG, stabilize LNG
 LNG Odorizer, HP Emergency Release System
Highlights Focus Areas
3 MODERATE GROWTH
Current Outlook: 1-2 projects 2020-25
Goal: Cost reduction to UTC5 (30-50%)
Areas of Opportunity:
 Lowering construction costs, time & footprint
 Radically simplify refrigeration schemes
 Reduce equipment count and complexity
 Reduce GHG emissions by 18%
Technology levers:
 LNG 2020: 30% cost reduction through
compact build and run or maintain philosophy
 0.15 tCO2/tLNG designs
 Compact design using PFHE
 Expansion Based Liquefaction (no refrigerant)
 3-D Printed Heat Exchanger
March 2017
CONFIDENTIAL
Technology Break-Out
Clear Guiding Principles

WHAT IS DEVELOPED? HOW DO WE WORK?

DRIVEN BY DEMAND EXISTING SOLUTIONS EYE ON THE FUTURE PROGRESS FAST END TO END DELIVERY BUSINESS IMPACT
FIRST

Only develop items that Always consider in this Selectively kickstart/ Clear ways of working See it through to the end Success measured by
address order: develop

 Gap to Potential 1. Fast de-risk existing  Potential game  Search wide  Deployment path in  Lower costs
(assets) options changers  High grade fast place early  Increased cash from
 UTC-to-5 (projects) 2. Catalyze the  differentiators for  Deployment based  Clear handover points assets
 Gaps not covered industry, by showing Shell decisions  Own until 1st  Replication results
already the pathways  Future needs of  Truth seeking mindset deployment  Selected as partner
 LNG specific 3. Co-develop with projects and assets  Continue to drive of choice
innovations industry (selectively) replication.

Copyright of Shell International CONFIDENTIAL May 2017 4

Overview Highlights Focus Areas Technology Break-Out
Significant Value Delivery in 2017 All numbers are NPV equivalent and
Shell Share unless otherwise stated
Selected Examples

17% potential capex

reduction
$50 mln
2

JAWS (Just Add Water)
Shipping optimization tool saves
fuel costs by optimizing speed
and draft using data analytics.
$42 mln
OLNG & NLNG
HEPA filters enable capacity
increase due to higher gas
turbine availability.
$400 mln
$2 mln Abadi Technology potential
T&T U/S capex reduction highlighted to
Lake Charles Rerating
Productivity increase on platform Shell project team and
Technology review of power
legs and cost reduction thanks to Operator INPEX. Joint Cost
margins resulted in a yearly net
HUMIDUR single layer coating.
production increase of 9%. Reduction Study on going.
$26 mln -$2.0 bln capex
(being assessed – unrisked
NLNG
– 100% share)
Online Dynamic Flow Modelling
enables extra production during
Baltic LNG (development)
condensate spiking.

1 - 2% extra
Deploy LNG2020 Tactics
5
$275
deployments in IG
mln production (unconstrained)
Podium steps
Canada LNG T3/4 Use of a small ladder instead of Nigeria LNG
Production increase through use a scaffold for maintenance jobs
where it is possible.
RTPO Deployment Pilot
of LMS-100 gas turbine.

1
Shell Technology & Innovation Excellence Award runner-up 2017 Digitalisation Replication technology

Copyright of Shell International CONFIDENTIAL

Overview Highlights Focus Areas Technology Break-Out
Development Program
Legend: Selected program items are described
in more detail in the next pages

Targets & programs 2018 2019 2020+

Understand detonation Automatic Integrity Recognition
Goal zero& Integrity Tier 1 & 2 incidents  50%
LOPC yr-on-yr 20% 
Existing assets;
RTPO C3MR RTPO CoP

RETURNS
Produce the limit

CASH &
Increase LNG NLNG Deploy +1% production +1% production

production by Utilization & Availability

ACHE improvements (DTS) Molsieve Lifetime extension
+1% availability increase 1 year lifetime extension
2%
Scaffoldless CUI OPEX reduction Prelude
Reduce asset costs Industry robots testing 20% Direct Asset Costs 25-30mln$ OPEX reduction

LNG2020 Autonomous LNG

Future LNG Low cost designs Lowering costs &

MODERATE
PFHE C3MR PFHE DMR

GROWTH
3D Printed HEX
improving reliability
projects; Autocooled LNG Cryocompressed LNG
Novel concepts LNG at -100C
Eliminating refrigerants
reduce capex Evaluation Z-LNG

Renewable LNG
to 4$/mmbtu GHG 0% tLCO2/tLNG
Organic rankin cycle

A-frame vapouriser Jettyless

Low cost regas
Compact, 5% less fuel - 1 $/ mmbtu
Regas; lower Tower SPM SPC pipeline Floating buoy

Air lubrication
costs by 1$ / Reduce shipping costs
5-10% less fuel
mmbtu

DEMAND
Integrated Regas/Powergen
GHG
More power, less CO2

LNG Calibration Facility

Enabling LNG4T Custody transfer
New markets;
Supercool LNG Absorbed NG
enable 50 Future markets Eliminating liquefaction
ANG vs CNG Start collaboration NASA +15% density
mpta LNG4T Methane Abatement Catalyst
GHG / Advocacy Zero methane slip
Sulphur tolerant MAC

Copyright of Shell International CONFIDENTIAL

Overview Highlights Focus Areas Technology Break-Out
 Fast & consistent Technology Replication
Production excellence driven
TECHNOLOGY SCREENING FOR ASSET MOVING FROM LISTS TO SPOTFIRE & THEMES TRACKING DEPLOYMENT & OPPORTUNITIES/ SPOTFIRE

Integrated Technology Tracker

Customer Value Propositions

CVPs

Technology Replication Thrust

Technologie Assets Status

Single technology repository, building on s
TRT’s source file

Confidential

Copyright of Shell International CONFIDENTIAL May 2017 7

Content

1. LNG Technology Platform overview

2. Highlights from Previous Year

3. Development program

4. Technology examples

Copyright of Shell International CONFIDENTIAL

Overview Highlights Focus Areas Technology Break-Out
 IG Technology goals 2018 World class
Above target
Scorecard On target
Below target

UNIT OF BELOW PLAN WORLD CO-

KEY PERFORMANCE INDICATOR TARGET PROGRESS TO DATE
MEASURE TARGET (OP17) CLASS OWNER

Technology Platform budget $ mln 1xx PTI

Development

Stage gates vs. plan % < 75 75-80 > 80 PTI

Governance: BTCs/ DRBs/Champion support meetings # 1/<18/<6 2/20/8 2/24/10 >2/24/>12 PTI

Collective Platforms risked NPV $ bln PTI Baseline is needed

Technology screening & assist plan (Priority Assets*) % < 80 80 90 100 PE
Assets
Top technologies reviewed (Priority Assets*) % < 80 > 80 > 90 100 PE “No Whitespace on quilt”
Identification
Technology assists # 3 5 7 >7 IGPO
Deployment

Projects
Technology explicit in opportunity register % < 70 70 80 90 IGPO
Number of deployments # 20 30 40 50 PE
Assets
Deployment Value realized from deployment $ mln 200 300 400 500 PE NPV; for $/yr, divide by 5
Projects Value realized from deployment $ mln 200 300 400 600 IGPO
Digitalization Digitalization roadmap in place % < 60 < 70 > 80 > 90 PE / TaCIT
Major items (SWW frontpage, Townhall presentation) # <3 3 4 >4 ER
Communication Minor items (LoB SWW, Yammer, Webcast) # 10 15 20 25 ER
Deployment Highlight Communication packs # 2 3 4 >4

 “Technology Priority Assets” to be covered under the Technology Deployment FFF (as of Oct 2017):
 ALNG, BLNG, ELNG, Gasnor, NLNG, NWS, OLNG, Pearl GTL, PLNG, Prelude, SEIC, SMDS, T&T Upstream, QGC
 Not included: Regas (Dragon, Hazira), Gas Rings (Hangzhou, Comgas, Attiki) MLNG, QG4, Gorgon, SPD, WAPCo, Various Upstream (STOS, Bolivia, Arrow, SCEPCo, India, Karoo, Bangkot, Uruguay, Venezuela)

CONFIDENTIAL

Copyright of Shell International CONFIDENTIAL 10

 Following the demonstration on
NLNG train 5, rapid replication
Technology 1: Real Time Production Optimization (RTPO) is already planned across
NLNG, OLNG and other assets

Technology and Benefits

Target
 RTPO controls and adjusts the setpoint for Advanced Process Control
(APC) schemes for refrigerant (MR / PMR) inventory and composition,
to improve efficiency and throughput of the LNG Plants.
 Technology allows plant to run longer times at max capacity potential
(within the operating window) of the facility.
 Grounded in fundamental process engineering and process control,
and enabled by data analytics.
 Enable liquefaction at optimal operating conditions, increases
reliability, by robust process control, and APC (SMOC) for the MCHE,
MR/PMR compositions.…
 Data Analysis estimates “Size of the Prize” i.e. potential production
increase:

~170 t/day = $11 mln/yr/LNG train ( Shell Share: 26 %)

(based on 10 months NLNG train-5 historical plant data)

NLNG endorsement:
117 tons/day => ~ 7.5 million $/year for train-5.

Copyright of Shell International CONFIDENTIAL

Overview Highlights Focus Areas Technology Break-Out
 Potential deployments include
Technology 2: LNG2020 Baltic, Abadi, Tanzania

Technology Description Technology and Business Benefits

 LNG2020 is a novel plant design that minimizes cost by  Up to 30% CAPEX reduction
reducing construction scope  OPEX 12% lower than PTAI LNG Average benchmark
Cost reduction achieved by aggressive competitive scoping ($0.29/mmBTU)
enabled by step-out operational and maintenance  30% more compact, at least 40% valves reduction
philosophies
Maintains high reliability and efficiency with a lower OPEX
Baltic Sakhalin
keeping LNG Fit for the Future LNG2020 DMR

Copyright of Shell International Footer CONFIDENTIAL Date Month 2016 12

Overview Highlights Focus Areas Technology Break-Out

Technology 3: Jettyless LNG Regas Terminal
Technology Description
 Transfer LNG from small LNGC to shore
 Simple mooring & offloading tower
 Connect to bow system on small carrier
 Subsea cryogenic pipeline to terminal
 Single Polymer Composite (SPC)
material for pipeline
Copyright of Shell International
Overview Highlights
Potential deployments include
regas developments in Senegal,
Benin, Bahamas and Indonesia
Technology and Business Benefits
 Regas tariff reduction 0.5-0.8 $/MMBtu
 No need for breakwater or long jetty
 High operability also in stronger waves
 Flexible site selection, close to customer
 Less invasive in the natural surroundings
Footer CONFIDENTIAL Date Month 2016 13
Focus Areas Technology Break-Out
 LNG TP flow
Shell / NOV
Project teams,
experience
FEDM’s, Program
Office
Yes
Disciplines
Fit with IG Yes Ranks on Yes Available as No LNG TP is Yes Ranking Yes Inclusion in LNG
Internal Studies Technology
Strategic value, time & industry natural (value & Platform Budget
(Deepdives) ideas Priorities? POS solution? home? timing) Proposal

External Studies No No
No No
(Innovia, Future IG)

Third Party
input

CONFIDENTIAL

Drop or
Develop
Drop Drop
elsewhere in
LNG COE

Copyright of Shell International CONFIDENTIAL October 2017 14

Technology maturation and opportunity realization

Technology maturation

3rd party technologies

D1 D2 D3
Discover
1 Develop
2 Demonstrate
3 D4 Deploy

Development
Release process
Initialization Technical assurance Deployment

Decision that DR DR approved for Deployment

will be required application learnings

Opportunity Realization
(for operating assets & project prospects)

Identify Assess Select Define Execute Operate

FEDM Project Operating

team asset

Copyright of Shell International CONFIDENTIAL

 Lowering project costs (roles of program office and R&D)
LNG Project Teams
1. Select concepts (incl. from technology catalogue)
2. Drive UTC to 5
3. Technology maturation plan
In project maturation
Deliver through DR
Support Support

Programme Office Project Development R&D Projects

UTC to 5, PT2020 (EE tools, CP tools)
Teams 1. Developments of new process
Linked to DR (performance)
1. CI / Benchmarking of system solutions 2. De-risking of 3rd party technology
Guarantee Shell Licence
Develop

Develop
(e.g. small floater)

Programme

Programme
3. Development of new technology equipment
2. Project development improvement tools De-risking enabling of technologies

Office
4.

R&D
(incl. PDM): Not linked to Shell performance /
5. Developing of enabling technologies
Early contractor engagements guarantee / license
6. CTI: scanning and evaluation of technology
(systems / concepts) Project timeline often too short
solutions in the market
PRS to take concept on board
CONFIDENTIAL
‘Clubbing’ under R&D for
multiple applications & fiscal
efficiency
BRNC (mainly asset focused)
1. Knowledge management (including design manuals)
2. Tools that cannot be classified as R&D ((e.g. new process simulator)
3. Natworks
Copyright of Shell International 4. Asset improvement programmes CONFIDENTIAL
LNG TP: Maximize Cash from Assets, Affordable Growth & Market Access
RECENT HIGHLIGHTS
~$10 mln/yr (per train)  Stronger focus on existing assets through deepdives, including

Real Time Production Optimization explicit digitalisation focus, and strengthened the LNG TP DRB.
(RTPO)  Finished 2017 with 24 deployments into LNG assets (150 mln/yr).
 Strong pull from Baltic and Abadi projects for LNG2020.
LNG Production
automation, targeting  Completed demonstration of value from RTPO and JAWS.

-20% UCC reduction

1-2 % increase in
LNG production,
DEPLOYMENT CHALLENGES
using Enhanced APC
LNG 2020 with Data Analytics.  Asset focus improving, however can benefit from a more explicit
Compact build and run or maintain
philosophy; For Baltic LNG, Abadi. connect to the Gap to Potential.

$10
 Need to watch the changes to P&T organization.

GHG Improvements mln/yr

JAWS; +3-10% fuel efficiency in LNG
 Project constraints & specific local requirements around JV’s

New 0.15 tCO2/tLNG design.
Methane Abatement Catalyst.
TP budget ($MM)
fleet. Optimizing LNG Carriers draft and
speed with data analytics.
9%
KEY DEPLOYMENTS COMING UP
 Real Time Production Optimization deployment in NLNG, starting
replication for NLNG and setup similar effort for Oman LNG.

 Replication deployment of JAWS

Assets
21%
39
2018 43%
Projects – Post DG3  Firm view on LNG2020 impact on Baltic and Abadi
29 ~$24M
25 24 NBD – Pre DG3  Linking the ‘Jettyless’ development to real regas projects.
27% Longer Term
2015 2016 2017 2018

Copyright of Shell International

Overview Highlights Focus Areas Technology Break-Out
Upcoming Deployments in 2018
Selected high impact deployments… …visualised in interactive online tracker
Selection of Technology deployments in execution phase in 2018. Examples left highlighted in orange.

Air Lubrication
Shipping LDN
Air Lubrication of LNG Carriers Motion Amplification
+6-8% fuel efficiency, on Gemmata in Software amplifies video of motion caused
July, 100+ ships potential in Shell, JV fleet. by vibrations, OLNG first deployment.

Smart Torque Wrench

Brunei LNG $1.00 mln

Smart Torque Wrench

Oman LNG $1.00 mln

Molsieve Prediction Model Realtime Production Optimization

Predicts breakthrough, longer operation APC automation allows for higher
before regeneration. QGC, NWS trial. efficiency, +1-2% production. NLNG T5

RTPO
Nigeria LNG
Smart Torque Wrench Motion Amplification Image
Nigeria LNG $1.00 mln Oman LNG

Integrated Technology tracker and visualization

Jettyless Drag Reduction Agent
All existing technology spreadsheet trackers have been merged into a single database (“Tracker”) also in use by
0.6-0.8 $/mmbtu cost reduction Application on trunkline walls to reduce
other LoB’s. The result is a simplification, but also an interactive database soon accessible for all via SharePoint.
friction & increase capacity, QGC trial.

March 2018

Replication technology Digitalisation

Copyright of Shell International CONFIDENTIAL

Overview Highlights Focus Areas Technology Break-Out