Marketing (Oil Products)
Our global retail business deploys a range of operating platforms; invested (company owned) and non-invested (dealer, branded wholesaler, branded licence agreement). On the invested operating platform, Shell owns assets and manages revenues. At non-invested platforms, assets and revenues are owned and managed by the dealer, wholesaler or licensee. These models enable the business to optimise performance depending on the country we are operating in.
Our branded fuel retail network is the world’s largest, with close to 43,000 branded service stations in over 70 countries. Our experience in fuel development, gained over more than 100 years, underpins our position today as a leading provider of innovative fuels. Differentiated fuels with unique formulations designed to improve performance are available in more than 50 countries under the Shell V-Power brand. Recently, we launched our latest generation of Shell V-Power across a range of key markets, including Japan and Brazil. We are the leading supplier of premium fuels among the international oil companies. In 2009, we launched the Shell FuelSave range. These products are now available in 29 countries. We also sell Shell Fuel Economy, our petrol and diesel formula, in 18 countries where Shell FuelSave has not yet been launched.
We have a close technical partnership with Scuderia Ferrari. Our fuel has helped the Ferrari motor racing team to achieve 10 Formula One World Constructors’ and 12 World Championship Drivers’ titles. This partnership enables our scientists and engineers to develop cutting-edge fuel technologies for the racetrack that can be used to make better road fuels for our customers.
In 2015, we completed the sale of our retail business in Norway to ST1 Nordic Oy (ST1). The Shell brand will continue to be highly visible in Norway through a retail brand licence agreement. We also completed the sale of 185 service stations across the UK to independent dealers. All service stations will retain the Shell brand and sell Shell’s fuels.
In April 2016, we completed the sale of our Marketing business in Denmark to Couche-Tard. The sale included our Retail, Commercial Fuels, Commercial Fleet and Aviation businesses, and products distribution activities associated with those businesses. The Shell brand will continue to be visible in the country through a Trademark Licence Agreement and lubricants will continue to be delivered through a separate distributor agreement.
Business to business
We sell fuels and speciality products and services to a broad range of commercial customers.
Shell Aviation fuels more than two million aircraft a year with a presence at more than 800 airports in around 40 countries. Customers range from private pilots to the largest global airlines and airports. In 2015, Shell was voted the ‘Best Aviation Fuels and Lubricant Brand’ by the readers of German aviation magazine, Aerokurier.
Shell Bitumen is the world’s largest marketer of bitumen with over 1,600 customers across 28 countries and supplies enough bitumen to resurface 450 kilometres of road lanes every day. We have also developed innovative bitumen products that can be mixed and laid at lower temperatures than conventional asphalt to reduce energy use and carbon dioxide (CO2) emissions. In 2015, Shell Bitumen was recognised by the International Road Federation for its odour-neutralising product Shell Bitufresh.
Shell Sulphur Solutions is a dedicated business which manages the complete value chain of sulphur, from refining to marketing. The business provides sulphur for industries such as mining and textiles and also develops products which incorporate sulphur, such as fertilisers. In 2015, we launched Shell Thiogro Urea-ES technology, which incorporates micronised elemental sulphur into urea fertiliser, an industry first.
In 2015, we completed the sale of Butagaz, our LPG business in France. Butagaz constituted the majority of our LPG business. Following the sale, we only have LPG businesses in Argentina, Canada and Hong Kong.
We completed the sale of most of our commercial fuels business in Norway to ST1 Nordic Oy (ST1). Shell has entered into a joint venture (50% Shell interest) with ST1 to sell aviation fuel in Norway.
We make and sell a wide variety of lubricants to meet customer needs across a range of applications. These include consumer motoring, heavy-duty transport, mining, power generation and general manufacturing. Our lubricants are sold in more than 100 countries. Shell also owns Jiffy Lube® franchised service centres in North America.
We have leading positions in both mature and emerging markets and continuously invest in our supply chain. We are building a new lubricant-blending and grease-manufacturing plant in Singapore, and have recently opened blending plants in Indonesia and China. We have four dedicated lubricants research centres in China, Germany, Japan (through a joint venture with Showa Shell) and the USA.
In 2014, we launched premium motor oils made from natural gas – Pennzoil Platinum in North America and Shell Helix Ultra outside of North America. These products are now available in more than 100 markets. They contain Shell PurePlus Technology: a patented process which converts natural gas into a clear base oil, the main component of motor oils. This base oil offers better lubrication compared to base oils made from crude oil. It helps to extend engine life, reduce maintenance costs and oil consumption, maintain fuel economy and improve engine cleanliness. The Ferrari Formula One team used Shell Helix Ultra with PurePlus Technology for the first time at the Singapore Grand Prix in 2014.
In 2015, we started a five-year global agreement with BMW for Shell Lubricants to be their sole aftermarket lubricant supplier across 53 countries.
Our marine business supplies around 90 grades of lubricants and fuels, as well as dedicated technical services for marine vessels powered by diesel, steam turbine and gas turbine engines.
The 13th annual Kline & Company report on the global lubricants sector confirmed our volume and brand leadership position, with a global market share of 12%.
In 2015, we completed the sale of our 75% interest in Tongyi Lubricants in China.
Shell Pipeline Company LP owns and operates seven tank farms across the USA and transports more than 1.5 billion barrels of crude oil and refined products annually through about 6,000 kilometres of pipelines in the Gulf of Mexico and five US states. Our various non-operated ownership interests add about an additional 13,000 pipeline kilometres to our portfolio, unlocking multiple interfaces to share best practices with other pipeline operators.
We carry more than 40 kinds of crude oil and more than 20 grades of gasoline, as well as diesel fuel, aviation fuel, chemicals, and ethylene.
Shell Midstream Partners is a fee-based, growth oriented master limited partnership formed by Royal Dutch Shell to own, operate, develop and acquire pipelines and other midstream assets. Shell Midstream Partners L.P. was listed on the New York Stock Exchange under the ticker symbol “SHLX” on October 29, 2014. Shell Midstream Partner’s assets consist of pipelines, oil storage and terminal systems that serve as key infrastructure to transport and store onshore and offshore crude oil production to Gulf Coast and Midwest refining markets and to deliver refined products from Gulf Coast markets to major demand centres. We control the general partner and hold a majority share in the limited partnership.
The international market for biofuels is growing, driven largely by the need to reduce greenhouse gas emissions from transport, but also to improve energy security and support the agricultural sector. Sustainable biofuels are expected to play an increasingly important role in helping to meet fuel needs and reduce CO2 emissions.
We are today one of the world’s largest blenders and distributors of biofuels and we continue to build capacity in conventional biofuels that meet our corporate and social responsibility criteria. The production, purchase, trading, storage, blending and distribution of biofuels are part of our everyday business.
In 2011, Shell and Cosan launched the Raízen biofuels joint venture (Shell interest 50%) in Brazil to produce ethanol, sugar and electricity, as well as supply, distribute and sell transport fuels. With a production capacity of more than 2.1 billion litres per year (35 thousand b/d) of ethanol from sugar-cane, Raízen is one of the world’s largest sugar-cane ethanol producers. The deal marked our first move into the mass production of biofuels. In 2015, Raízen opened a second-generation biofuels plant, which uses technology from our earlier programmes with Iogen Energy. Once fully operational, it is expected to produce about 40 million litres of cellulosic ethanol a year from sugar-cane bagasse and sugar-cane waste.
New advanced biofuels technology can turn feedstock such as woody biomass or inedible plants into high-quality fuels, while further reducing CO2 emissions compared to gasoline and diesel. In 2012, Shell built an advanced biofuels pilot plant at our Westhollow Technology Centre in Houston, USA, to produce drop-in biofuels. In 2015, also in Houston, we completed the construction of a plant to demonstrate a proprietary pre-treatment system for the production of cellulosic ethanol.
A third pilot plant, approved in 2015, will be built in Bangalore, India. The demonstration plant will use IH2 technology (licensed from GTi) to convert a range of forestry and agricultural residues and municipal wastes directly into drop-in fuels or blend stocks.