Shell invests in new Nigeria LNG processing unit

Shell Gas B.V., a subsidiary of Royal Dutch Shell plc, today announced that all conditions for its Final Investment Decision (FID) on a new LNG processing unit at Nigeria LNG (NLNG) have now been met. These conditions included formal commitment from the organisations providing financing for the project. Subsequent to the FID, NLNG has announced awards of engineering, procurement and construction (EPC) contracts.

Once operational, the new unit, known as Train 7, will add around 8 million tonnes per annum (mtpa) of capacity to the Bonny Island facility, taking the total to around 30 mtpa.

Currently operating six processing units, or trains, the decision to build a seventh will bolster NLNG’s contribution to the development of the country through generating revenues for the Nigerian government and delivering key natural gas products for domestic use.

NLNG is a joint venture owned by the Nigerian National Petroleum Corporation (NNPC – 49%), Shell (25.6%), Total (15%) and ENI (10.4%). All shareholders have supported the EPC awards and construction schedules will be finalised once the situation with COVID-19 has stabilised.

“While remaining mindful of prevailing macro-economic challenges, Shell continues to see NLNG as a great resource that can deliver value to the people of Nigeria and investors alike. This decision is consistent with our long-term strategy and our disciplined approach to capital investment,” said Maarten Wetselaar, Shell’s Integrated Gas and New Energies Director. “Natural gas is a core component of our strategy to provide more and cleaner energy solutions. With global LNG demand expected to double by 2040, the expansion of the NLNG Bonny Island facility is crucial in helping Shell meet the world’s growing energy needs.”

‘‘We are happy with the progress NLNG has made over the years and its enormous contributions to the Nigerian economy. The EPC awards for Train 7 is good news for Nigeria with the potential to bring more export revenues, unlock new projects, and attract foreign direct investments, in addition to transforming the economy of the Niger Delta and Nigeria as whole,” said Osagie Okunbor, Country Chair, Shell Companies in Nigeria and Managing Director, The Shell Petroleum Development Company of Nigeria Ltd. “Shell is positioned to support NLNG’s expansion by working with our government and other partners to develop new gas resources to sustain this growth and enhance both domestic and export gas supplies"

• The new LNG processing unit will be funded by NLNG without shareholder loans or shareholder equity requirements. The project cost is therefore not reported as part of Shell’s overall capital expenditure.

Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges. Shell companies have operations in more than 70 countries and territories with businesses including oil and gas exploration and production; production and marketing of liquefied natural gas and gas to liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects. For further information, visit www.shell.com.

The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this press release “Shell”, “Shell Group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Royal Dutch Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this press release refer to entities over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated arrangements over which Shell has joint control are generally referred to as “joint ventures” and “joint operations”, respectively. Entities over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.

This press release contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) 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 “aim”, “ambition”, ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, “schedule”, ‘‘seek’’, ‘‘should’’, ‘‘target’’, ‘‘will’’ and similar terms and phrases. 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 press release, 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 regulatory measures addressing climate change; (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; (m) risks associated with the impact of pandemics, such as the COVID-19 (coronavirus) outbreak; and (n) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this press release 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 risk factors that may affect future results are contained in Royal Dutch Shell’s Form 20-F for the year ended December 31, 2019 (available at www.shell.com/investor and www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this press release and should be considered by the reader. Each forward-looking statement speaks only as of the date of this press release, 13 May 2020. Neither Royal Dutch Shell plc 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 press release.

We may have used certain terms, such as resources, in this press release that the United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. 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.