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Shell oil sands expansion now on-stream

Shell, as operator of the Athabasca Oil Sands Project (AOSP), today announced the successful start of production of a 100,000 barrels per day expansion of its oil sands operations in Canada. The new Jackpine Mine will combine with existing production from the Muskeg River Mine to feed the Scotford Upgrader, which processes the oil sands bitumen - heavy oil - for refined oil products. Construction for an expansion of the Scotford Upgrader is underway, and will come on-stream in 2011.

"The Jackpine Mine is a tremendous addition to our oil sands portfolio," said Marvin Odum, Shell Upstream Americas Director and President of Shell Oil Company.

The Jackpine Mine adds capacity of 100,000 barrels of oil equivalent (boe) per day to the existing Muskeg River Mine capacity of 155,000 boe per day. Once the Upgrader expansion is online early next year production will rise towards capacity over 2011.

This AOSP expansion is one of a sequence of major projects that should raise Shell's global oil & gas production by 11% over the 2009 - 2012 period.

The construction of the Jackpine Mine in northern Alberta took around five years, with more than 6,500 employees and contractors involved on site at its peak. With some 255,000 barrels per day of capacity now in hand, next steps will include the efficiency improvements that can come from integrating and operating these assets together, with incremental growth potential from debottlenecking investment.

Odum continued: "Canada's oil sands are an important source of energy in a world with increasing energy needs. Shell is committed to developing this resource responsibly and to pursuing opportunities to reduce the impacts of our oil sands operations.  To reduce the CO2 footprint of our oil sands operations, we are continuing to advance our proposed carbon capture and storage project, Quest, which could capture and store underground some 1 million tonnes of CO2 per year from the Scotford Upgrader."

Shell Canada Energy is 60% owner and operator of the Athabasca Oil Sands Project (AOSP) along with Chevron Canada Limited (20%) and Marathon Oil Corporation (20%). AOSP includes the Muskeg River Mine, Jackpine Mine and Scotford Upgrader.


Jackpine Mine fast facts


  • Adds 100,000 boe/d total capacity and brings AOSP total capacity to 255,000 boe/d.
  • More than 650 Engineers based in Calgary designed the facilities.
  • More than 34,000 different people worked at the construction site over the nearly five years of construction, amounting to some 30 million man-hours.
  • Over the course of construction the skilled professionals who worked on the project included:
    o 3,500 electricians
    o 1,700 ironworkers
    o 2,000 pipefitters
    o 1,200 welders
  • Apprentices made up over 40% of the workforce, which helps to build local skills.
  • Some 30% of the workforce was female.
  • Around 300 contracts were awarded.
  • To support the expansion, an onsite 2,500-person hotel-style accommodation was constructed to reduce traffic and other demands on local services, in addition to attracting and retaining skilled workers to the project.
  • An adjacent airstrip to transport workers, equipment and supplies opened in November 2007.
  • Commodities used included:
    o ~ 70,000 cubic metres concrete,
    o ~ 30,000 tonnes steel,
    o ~ 190,000 metres pipe,
    o ~ 2.5 million metres cable.
More information on Quest is available at www.shell.ca/quest


Enquiries


Media Relations
Shell International Media Relations: +31 70 377 3600
Shell US Media Relations: +1 713 241 4544
Shell Canada Media Relations: +1 877 850 5023

Investor Relations
The Hague - Tjerk Huysinga: +31 70 377 3996 / +44 207 934 3856
USA - Harold Hatchett: +1 713 241 1042

spacer.gif spacer.gif Cautionary note
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate 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 subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies. ''Subsidiaries'', "Shell subsidiaries" and "Shell companies" as used in this press release refer to companies in which Royal Dutch Shell either directly or indirectly has control, by having either a majority of the voting rights or the right to exercise a controlling influence. The companies in which Shell has significant influence but not control are referred to as "associated companies" or "associates" and companies in which Shell has joint control are referred to as "jointly controlled entities". In this press release, associates and jointly controlled entities are also referred to as "equity-accounted investments". The term "Shell interest" is used for convenience to indicate the direct and/or indirect (for example, through our 34% shareholding in Woodside Petroleum Ltd.) ownership interest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.

This press release 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. 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 the Shell's products; (c) currency fluctuations; (d) drilling and production results; (e) reserve 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; and (m) changes in trading conditions. 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 factors that may affect future results are contained in Royal Dutch Shell's 20-F for the year ended December 31, 2009 (available at www.shell.com/investor and www.sec.gov - opens in new window). These factors also should be considered by the reader.  Each forward-looking statement speaks only as of the date of this press release, 15 September 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 press release.

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 may have used certain terms in this press release 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 - opens in new window. You can also obtain these forms from the SEC by calling 1-800-SEC-0330.

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