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Royal Dutch Shell Management Discusses Q2 2012 Results - Earnings Call Transcript

The underlying Upstream volumes were good. They were up 4%. We have new projects under construction for medium-term growth, making deliberate top down choices with our investments, where we can add value with technology, with integration and the scale of Shell.

Now we're also working hard to get choice into our portfolio with new exploration acreage and new integrated gas opportunities crystallizing in 2012, and I'll come back to that with a slide later on. So it has been a busy time and still is a busy time in 2012, and I will give you now some more details on the issues which we're working on.

First let me start with continuous improvement. We are working on these programs across the company and the opportunities, they run actually into the billions of the dollars from a potential point of view. In Downstream, for example, where industry returns are likely to remain under pressure for some time, we have put a lot of work into reducing our unplanned downtime in our refineries and chemical plants. There's clearly more to come here, but I'm -- what we have seen so far are very positive trends. This is actually the first half unplanned downtime at historically low levels and the top quartile industry performance.

The Port Arthur refinery expansion project on the Gulf Coast, which had crude distillation unit damage shortly after startup, is not yet in the figures on this chart. The Motiva joint venture, which runs this plant, expects the crude units restarts to be delayed into 2013. Now let me just be clear, we are not happy with this. And we are investigating and we're working hard to turn this around and actually learn out of the incident.

On the Upstream side, we are coming to the end of the ramp-up of the 3 large projects we have been working for the last 6 years or so. Qatar LNG and GTL and Canada Oil Sands, and I think many of you have been visit -- have had the chance to visit these assets. Large scale, taking low Upstream volumes into end-user products markets major investments as infrastructure and technology.

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