Financial framework

Shell’s strategy and financial framework are designed to manage through multi-year macroeconomic cycles and multi-decade investment and returns programmes. We balance near-term affordability and cost trends with the fundamentally long-term nature of our industry.

Cash flow priorities

Priorities for cash

Buybacks & capital investment
Continue to reduce gearing to 20%
Cancel scrip dividend
Buy back shares

Progress towards a world-class investment case
Increase shareholder distributions

Our priorities for cash flow are reducing debt and paying dividends, followed by a balance of share buybacks and capital investment.

Shell’s dividend distributed in 2017 was $15.6 billion. Our dividend policy is to grow the US dollar dividend through time, in line with our view of Shell’s underlying earnings and cash flow. When setting the dividend, the Board looks at a range of factors, including the macroeconomic environment, the current balance sheet and future investment plans.

The company's progress and the confidence in our financial framework enabled the Board to cancel the Scrip Dividend Programme, starting with the payment of the fourth quarter 2017 dividend. With the cancellation now behind us and with strong performance and delivery against our commitments, we are entering the next phase in delivering a world-class investment case.

We will maintain our commitment to the financial framework, continue to grow the company and look to increase shareholder distributions over time. The company is confirming the plans for share buybacks of at least $25 billion in the period 2017-2020, subject to progress with debt reduction and recovery in oil prices. 

We continue to manage four cash flow levers: divestments, reduced capital investment and operating expenses, and delivering new projects that will add significant cash flow.


$ billion

Divestments (in $ billion) – development from 2013 to 2017 (bar chart)

Capital investment [A]

$ billion

Capital investment (in $ billion; excludes BG acquisition in 2016) – development from 2014 to 2017; 2018-20 average (bar chart)

[A] Excludes BG acquisition in 2016; historical BG capital investment is based on BG’s published Annual Report.

Underlying operating expenses [A]

$ billion

Underlying operating expenses (in $ billion) – development from 2015 to 2017 and with an expectation for 2018 (bar chart)

[A] Operating expenses excluding identified items
[B] Historical BG operating expenses based on BG's published Annual Report.

Shell project start-ups 2014 through 2020

$ billion

$ billion p.a.

Shell project start-ups 2014 through 2020 (in $ billion and $ billion p.a.) for Production and Cash flow from operating activities (RHS) (line chart)