Overall highlights in 2019

CCS earnings

$16.5 billion

excl. identified items

Cash flow from operating activities

$42.2 billion

at an average $64/bbl Brent price

Cash capital expenditure

$23.9 billion

Free cash flow

$26.4 billion

Total dividends distributed

$15.2 billion

Share buybacks

$14.1 billion

completed in 2018-2019

Underlying operating expenses

$37.0 billion



2019 was a year of progress towards all three of our strategic ambitions and we continue to transform Shell into a simpler company that can deliver higher returns. We have delivered good cash flow performance despite the tough macro headwinds we faced. We have built a resilient business and with continued discipline we expect to succeed.

The recent levels of profitability have been lower than before. Firstly, this is driven by lower oil and gas prices. In 2018, the average oil price was $71 per barrel. In 2019, oil prices averaged around $64 per barrel. This has impacted our earnings and cash flow. The geopolitical landscape and risk dynamics remain challenging. Secondly, we have seen weaker economic activity impacting margins, particularly in refining, and most clearly in chemicals. Despite these impacts, our 2019 cash flow from operations, excluding working capital movements, was almost $47 billion. This translates to more than $26 billion in free cash flow.

We have maintained strong capital discipline with cash capital expenditure in 2019 of $24 billion. This was at the lower end of our guidance for the year and reflects our disciplined approach to investments. This helps us to deliver more with significantly less.

We have also continued to high-grade our broader asset portfolio. In 2019, this high-grading resulted in divestments totalling around $5 billion across all businesses. This work will continue. Our ambition is to deliver more than $10 billion of asset divestments across 2019 and 2020 but the timing depends on market conditions. 

Our share buyback programme has reached some $14 billion in shares purchased by the end of 2019 since we started it in July 2018, fully offsetting all scrip dividends issued following the BG Group combination.

We expect 2020 to be a year where we reinforce business resilience and financial strength. In order to deliver sustainable cash flow generation, we are actively managing all our operational and financial levers – from focusing on maintaining safe and reliable operations to reducing capital spend and operational expenses. Given the current macroeconomic conditions, we have announced a reduction in cash capital expenditure for 2020 to $20 billion or below from a planned level of around $25 billion.  

Resilient cash flow generation [A]

$ billion

Resilient cash flow generation (in $ billion) – development from 2015 to 2019: Average Brent oil price ($/bbl): 2015: 52, 2016: 44, 2017: 54, 2018: 71, 2019: 64; Cash flow from operations excluding working capital movements: 2015: 25,075, 2016: 29,041, 2017: 37.5, 2018: 49,643, 2019:46,958 (bar chart)

[A] Working capital movements in 2015, 2016, 2017, 2018, 2019 (respectively): $4,735, $(8,426), $(2,250), $3,442 and $(4,779) (in million).

Portfolio developments

Key portfolio events in 2019 included the following:

  • The first shipment of sailed from our Prelude floating liquefied natural gas (FLNG) facility (Shell interest 67.5%).
  • In the US Gulf of Mexico, we announced first production from Appomattox (Shell interest 79%). It is the first commercial discovery brought into production in the deep-water Norphlet formation in the US Gulf of Mexico.
  • Also in the US Gulf of Mexico, we announced the final investment decision (FID) to develop the PowerNap field (Shell interest 100%).
  • In deep water off Brazil, we announced first production from two of our floating production, storage and offloading (FPSO) vessels: P-67, in Lula North (Shell interest 23%, post-unitisation); and P-68, in Berbigão (Shell interest 25%, subject to unitisation).
  • We took to contract the Mero 2 vessel to be deployed at the Mero field offshore Santos Basin in Brazil.
  • In Malaysia, we took FID on the second phase of the Malikai deep-water development (Shell interest 35%).
  • In New Energies, we acquired sonnen, a provider of smart energy storage systems, and ERM Power, one of Australia's leading commercial and industrial electricity retailers.
liquefied natural gas
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final investment decision
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floating production, storage and offloading
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