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SUSTAINABILITY REPORT ROYAL DUTCH SHELL PLC SUSTAINABILITY REPORT 2011 I Shell Sustainability Report 2011 Introduction

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SUSTAINABILITY REPORT ROYAL DUTCH SHELL PLC SUSTAINABILITY REPORT 2011 I Shell Sustainability Report 2011 Introduction SUSTAINABILITY REPORT ROYAL DUTCH SHELL PLC SUSTAINABILITY REPORT 2011 i Shell Sustainability Report 2011 Introduction CONTENTS ABOUT SHELL INTRODUCTION Shell is a global group of energy and petrochemical companies employing 90,000 people in more than 80 i ABOUT SHELL countries. Our aim is to help meet the energy needs of 1 INTRODUCTION FROM THE CEO society in ways that are economically, environmentally and socially responsible. OUR APPROACH Upstream 2 BUILDING A SUSTAINABLE ENERGY FUTURE Upstream consists of two organisations, Upstream International and Upstream Americas. Upstream searches for and recovers oil 3 SD AND OUR BUSINESS STRATEGY and natural gas, extracts heavy oil from oil sands for conversion 4 SAFETY into synthetic crudes, liqueƂ es natural gas and produces synthetic oil products using gas-to-liquids technology. It often works in joint 5 COMMUNITIES ventures, including those with national oil companies. Upstream 6 CLIMATE CHANGE markets and trades natural gas and electricity in support of its business. Our wind power activities are part of Upstream. Upstream 8 ENVIRONMENT International co-ordinates sustainable development policies and 9 LIVING BY OUR PRINCIPLES social performance across Shell. Downstream OUR ACTIVITIES Downstream manufactures, supplies and markets oil products and 10 SUSTAINABLE DEVELOPMENT IN ACTION chemicals worldwide. Our Manufacturing and Supply businesses include reƂ neries, chemical plants and the supply and distribution 11 KEY PROJECTS of feedstocks and products. Marketing sells a range of products 12 DELIVERING ENERGY RESPONSIBLY including fuels, lubricants, bitumen and liqueƂ ed petroleum 12 Natural gas gas for home, transport and industrial use. Chemicals markets 15 The Arctic petrochemicals for industrial customers. Downstream trades and 16 Deep water ships crude oil, oil products and petrochemicals primarily to 18 Nigeria optimise feedstock for our manufacturing activities. Downstream also includes our activities in biofuels, and it co-ordinates CO 20 Revenue transparency 2 21 Working with our suppliers management activities across Shell. 22 Iraq 23 Oil sands Projects & Technology Projects & Technology manages the delivery of Shell’s major 24 DELIVERING MORE SUSTAINABLE PRODUCTS projects and drives its research and technology development 24 Biofuels programme. Projects & Technology provides technical services 26 Fuels and products and technology capability to the Upstream and Downstream organisations. It oversees safety and environmental performance and manages contracting and procurement across Shell. OUR PERFORMANCE 28 2011 IN REVIEW www.shell.com/about 28 Economic 28 Environmental 30 Social 32 ENVIRONMENTAL AND SOCIAL DATA VIDEO INTRODUCTION FROM THE CEO 34 EXTERNAL REVIEW COMMITTEE Watch Peter Voser’s introduction to this report online by typing the link below into 36 ABOUT OUR REPORTING a web browser. Or use a smartphone with 37 ABOUT OUR DATA a QR reader app to scan the symbol. www.shell.com/sustainabilityreport KEY TO SYMBOLS web or email address telephone number Shell Sustainability Report 2011 1 Introduction INTRODUCTION FROM THE CEO “WITH TOUGH ECONOMIC CONDITIONS PREVAILING, AND MOMENTOUS SOCIAL CHANGE TAKING PLACE IN SOME COUNTRIES, THE WORLD MUST NOT LOSE SIGHT OF LONGER-TERM CHALLENGES.” Welcome to the Shell Sustainability Report biofuels for transport, will also increase We have worked closely with communities, for 2011. steadily. But Shell believes we cannot view coastguards and regulatory authorities to energy supply and demand in isolation. put the necessary safeguards in place. This It was a year of continued economic As the world becomes more crowded, the collaborative effort has been invaluable. turbulence that once again showed how stresses between the essentials of life – placing sustainable development at the water, food and energy – will become more We believe transparency in our operations core of our business decisions is the right critical. Energy production needs water, helps build trust. In Nigeria, for example, approach. This means putting consideration and providing enough water and food the Shell Petroleum Development Company for safety, the environment and communities to sustain people needs energy. Climate (SPDC) launched a website in 2011 that at the centre of the steps we take to design, change is likely to intensify the stresses. enables people to track details of oil spills build and operate major energy projects. at its facilities, whether from operations The energy we provide must be produced These are huge, integrated challenges and or due to sabotage or theft, and how it and delivered in the right way. there is no time to waste if the world is to deals with them. Nigeria faces many tackle them effectively. Yet the relationship challenges. The best way to address them Sustainability depends on our ability between government, business and civil is a multi-party approach by government, to build resilience into our plans and society is struggling to work. To build a communities, industry and others. SPDC operations. We have to make sure Shell sustainable energy system, we need a new is ready to play a key role in such an remains able to tackle future challenges so level of collaboration and leadership to approach. that we, in turn, can continue to make a develop workable policies and solutions. positive contribution to society. We know We need vision and action. Major Shell was a founding member of the that doing business responsibly helps us companies like ours can help encourage the UN Global Compact and we support achieve this through greater productivity global co-operation needed across public its principles in human rights, labour, and by creating beneƂ ts for all. We can and private sectors, and across industries. environment and anti-corruption. We are deliver our projects more effectively, also a signatory to the Global Compact increase production faster, supply our At Shell we believe that responsibly LEAD, which reinforces the commitment of customers with products more efƂ ciently, delivering cleaner, more reliable and business to these principles. In this report and create supply chains and jobs for local affordable energy is the best contribution you can read about our progress in these businesses. It is a situation where everyone we can make today to a more stable world areas. wins. where economies can thrive. To do this we work with others including communities, Once again I would like to thank the Global challenges other companies, governments, consumers members of the External Review Committee With tough economic conditions prevailing, and non-governmental organisations. But for their valued contributions in producing and momentous social change taking place we know there is much work to do to meet the Sustainability Report 2011. in some countries, the world must not lose the challenges of building a sustainable sight of longer-term challenges. energy future. I also invite you to send your comments on the report to: There are now 7 billion people in the Safety and principles world, and we are on our way to 9 billion After the BP Deepwater Horizon tragedy [email protected] by 2050. In the decades to come, major in 2010, the energy industry rightly came economies will continue to consume energy under intense scrutiny. For Shell, safety to grow. In developing countries many remains our top priority. Our standards are people will become wealthier, buying their rigorous. If things do not go as planned Ƃ rst television, refrigerator or car. In short, we respond swiftly and decisively, and the world will need more energy. we investigate all incidents to learn and improve our performance. Peter Voser Fossil fuels will still provide the bulk of this Chief Executive OfƂ cer energy with, we believe, a greater role We prepare thoroughly to prevent to play for cleaner-burning natural gas. incidents. In 2012, we intend to start Renewable energy, including low-carbon exploration drilling in waters off Alaska. 2 Shell Sustainability Report 2011 Our approach OUR APPROACH BUILDING A SUSTAINABLE ENERGY FUTURE The global energy system is in the early stages of a transformation. Population growth, rising prosperity and rapid urbanisation will put increasing pressure on energy supplies over the next 40 years. More and cleaner energy will be needed from even more sources, against a backdrop of greater economic volatility and growing environmental pressures. During these uncertain times, Shell continues to invest in delivering more energy and helping to build a more sustainable energy future in which cleaner-burning natural gas increasingly replaces coal to generate power. The world’s 7 billionth person was born in analysis shows that fossil fuels and nuclear 2011. With Ƃ ve more people born every could meet at least 70% of global energy second, the planet is expected to be home demand in 2050. to more than 9 billion by 2050. Asia’s rapidly expanding cities will absorb much Energy, water and food of this growth, with three in four people The International Energy Agency (IEA) living in urban centres, up from two in four estimates that the world will need to invest today. Many millions of people will rise some $38 trillion in infrastructure to meet out of energy poverty. With higher living projected energy demand to 2035 alone. standards comes rising energy use. Energy At the same time, climate change remains demand could double by the middle of the a global threat, while countries are facing century from its level in 2000. mounting tensions over fresh-water supplies and food prices. Supplying this vital extra energy will Ç In the future many more people will live in cities. become increasingly difƂ cult. Conventional A path to a more sustainable energy future energy sources will struggle to keep pace, will need an integrated approach. In even with technological advances. With 2011, Shell brought together specialists potentially catastrophic climate change”, strong government support, renewables from the energy, water and food industries said the IEA. could meet up to 30% of the world’s along with experts from governments and energy demand by 2050, compared non-governmental organisations.
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