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ROYAL DUTCH SHELL PLC - Shell updates on its intentions for Shell-BG combination

PR Newswire

London, December 14

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

For immediate release

14 December 2015

Shell updates on its intentions for the combined Shell-BG group

The Hague, 14 December 2015 – In advance of completion of its recommended combination with BG Group, Shell today announced further details of the proposed operational and administrative restructuring under consideration. Shell expects the restructuring will be required to achieve the expected benefits of the recommended combination, including previously disclosed and reported-on pre-tax synergies of $3.5 billion (subject to the bases of belief, principal assumptions and sources of information set out in the Appendix to the announcement made by Shell on 3 November 2015 providing investors with a strategic update).

Shell’s expectation is that BG’s business would be integrated into Shell's businesses. As part of that, Shell proposes that office consolidation will be undertaken where practical in certain locations around the world. With regards to office footprint rationalisation in the UK, Shell will, following deal completion, undertake a comprehensive review during the course of 2016.

Shell currently expects an overall potential reduction of approximately 2,800 roles globally across the combined group, or approximately 3% of the total combined group workforce. These reductions are in addition to the previously announced plans to reduce Shell’s headcount and contractor positions by 7,500 globally.

The proposed changes are subject to deal completion, engagement with affected employees and relevant employee representatives. Further detailed work will be undertaken on the details of the proposed operational and administrative restructuring as part of ongoing integration planning. The deal remains on track for completion in early 2016.

Ends

Enquiries:

Shell Media Relations

International: +44 207 934 5550

Americas: +1 713 241 4544

Shell Investor RelationsEurope: + 31 70 377 4540

North America: +1 832 337 2034

Additional Information

This announcement is not intended to and does not constitute or form part of any offer to sell or subscribe for or any invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Shell-BG combination or otherwise, nor shall there be any sale, issuance or transfer of securities of Shell or BG pursuant to the Shell-BG combination in any jurisdiction in contravention of applicable laws.

This announcement does not constitute a prospectus or prospectus equivalent document.

Overseas jurisdictions

The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe, any applicable requirements. The information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

No profit forecast

Statements of estimated cost savings and synergies relate to future actions and circumstances which, by their nature, involve risks, uncertainties and contingencies. As a result, the cost savings and synergies referred to may not be achieved, may be achieved later or sooner than estimated, or those achieved could be materially different from those estimated. For the purposes of Rule 28 of the City Code on Takeovers and Mergers (“Code”), the quantified financial benefits statement contained in this announcement is the responsibility of Shell and the Shell directors. Neither this statement nor any other statement in this announcement should be construed as a profit forecast or interpreted to mean that the combined group's earnings in the first full year following implementation of the Combination, or in any subsequent period, would necessarily match or be greater than or be less than those of Shell or BG for the relevant preceding financial period or any other period. The bases of belief, principal assumptions and sources of information in respect of the quantified financial benefits statement, as well as the reports provided for the purposes of Rule 28 of the Takeover Code by Deloitte LLP as reporting accountant and Bank of America Merrill Lynch as financial adviser, are set out in Shell’s management day announcement on 3 November 2015.

Forward looking statements

This announcement contains certain forward looking statements with respect to the financial condition, results of operations and businesses of Shell and BG and their respective groups, and certain plans and objectives of Shell with respect to the combined group. All statements other than statements of historical fact are, or may be deemed to be, forward looking statements. Forward looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward looking statements include, among other things, statements concerning the potential exposure of Shell, BG and the combined

group to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions, including as to future potential cost savings, synergies, earnings, cash flow, return on average capital employed, production and prospects. These forward looking statements are identified by their use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "goals", "intend", "may", "objectives", "outlook", "plan", "probably", "project", "risks", "seek", "should", "target", "will" and similar terms and phrases.

There are a number of factors that could affect the future operations of Shell, BG and the combined group and that could cause results to differ materially from those expressed in the forward looking statements included in this announcement, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell, BG and the combined group’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions.

All forward looking statements contained in this announcement are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward looking statements. Additional risk factors that may affect future results are contained in Shell's Form 20-F for the year ended 31 December 2014 (available at www.shell.com/investor and www.sec.gov). These risk factors expressly qualify all forward looking statements contained in this Announcement and should also be considered by the reader.

For a discussion of important factors which could cause actual results to differ from forward looking statements relating to BG and the BG group, refer to BG’s Annual Report and Accounts for the year ended 31 December 2014.

Each forward looking statement speaks only as of the date of this Announcement. None of Shell, the Shell group, BG or the BG group undertakes any obligation to publicly update or revise any forward looking statement as a result of new information, future events or otherwise, except to the extent legally required. In light of these risks, results could differ materially from those stated, implied or inferred from the forward looking statements contained in this announcement.

In accordance with Rule 26.1 of the Code, a copy of this announcement is also available on the website of Shell at: www.shell.com.

For the avoidance of doubt, the contents of the website referred to in this announcement are not incorporated into and do not form part of this announcement.