1 CONFIDENTIAL

Real Estate & GFPT CP

September 2013

Global Facilities Management Platform An Introduction

Real Estate – Providing a Great Place to work, rest & play

Who are Shell? Global group of energy and petrochemicals companies with 90k employees in more than 70 countries and territories. We use advanced technologies and take an innovative approach to help build a sustainable energy future.

Real Estate : Real Estate’s role is to manage the Group’s property portfolio and non-hydrocarbon infrastructure (beyond offices).

Facilities Management : Deliver a fit-for-purpose working environment and related services, driving functional excellence in strategy, standards and tools for non-hydrocarbon infrastructure.

Procurement Strategy : Develop a global strategy/platform, local application and sensitivity

Scope of Global Re-Tender

Contract Value : $500m spend per year, $3.5bn Contract Value (5+2 Years)

Services in Scope : Hard Services, Soft Services, Minor Projects and Asset Protection (Security)

Geographies Covered in RFP : 30+ Countries in Scope, 20x Bid Lots

Sourcing Approach : Let the market drive optimal outcome and level of supplier consolidation

Process : Intensive RFI, yellow-pad and dialogue sessions to really understand competency, coverage and capability and build relationships. Competitive RFP process with Technical and Commercial evaluation. Technical team composition drives buy-in of staff

Governance : Secured commitment from Upstream, Downstream and Projects/Technology via robust governance and Stage Gate process with Decision Review Board (DRB) and commercial review at Shell Group Contracts Board (GCB) to drive group wide visibility of strategy

Vision & Objectives for 2nd Gen RFP

Engage the Market

Appropriate Segmentation linking to business drivers Move from Proving,

Proving to Partnering

Interdependencies

Global Vision

Benefits Delivered

Savings Delivery : Double digit % value improvement over prior year costs with savings glide path over years 2-5.

Service Providers : New framework suppliers complement existing 1st Gen providers. 50%+ re-distribution of wallet

Standards : Global set of output specifications (OLAs)

Common Tools and Process : Tools, processes and organisation in Real Estate support implementation and stabilization of the new contracts.

Local Content : Global strategy but with local sensitivity and content (US, Canada, Middle East, Africa).

Worker Welfare : Social Performance, Employee Value Proposition fully considered in complex/remote/camp locations.

Aspiration to achieve transformational Change - Program

Change Team : Appointed with PMO. Mobilization SharePoint and Tracker created

Focus : Go-Live Ready and Stabilize Contracts

Training Programme : Training program devised to support the change process. Key components are : Module 1: Collaboration Workshop. Full day face to face

session including the team leaders from both Shell RE and their Suppliers. Aim to instil the right collaboration behaviours, stress test behaviour in safe environment

Module 2: Ethics & Compliance & OLAs. Dial in session, repeated on a monthly basis throughout the mobilisation period. Open to both Shell RE and suppliers

Module 3: Technical and Commercial elements of GFMP. Dial-in session which open to both Shell RE and suppliers

Communications : Internal & External

Next Generation Challenges

Extract Value Beyond Price : How to get more from strategic relationships with service providers?

Shared Savings Incentive Scheme following early delivery of the whole-life cost down commitments

Invest in better governance and line of sight within global relationships

Develop Eco-System thinking within pool of global framework agreement suppliers

Drive CI (Continuous Improvement) agenda much harder bottom up and top-down

Growth & Complex Ventures

Help service providers grow their business with Shell

Offer a workable solution to Joint Ventures to allow adoption of strategy (global strategy, local execution)

Real Estate Operating Principles

Performance : Service delivery aligned to operational business needs. Clear measurement, structured review, aligned reward

Real Estate Focus : RE interpret business needs and manage group’s Real Estate portfolio. Suppliers manage operational detail

Real Estate – Organisational Methodology (FMOM) Shell Business : Needs Real Estate to manage the business & supplier interface. Single line of sight / entry for business. RE positioned as a professional function, not service provider

Organisational Design : Real Estate site management roles involved in the strategic/tactical management of buildings only. Not operational issues.

Empowered Suppliers : Clear roles and accountabilities supported by strong foundation (behaviours, relationships, tools and processes)

Shell Site Roles : Understand business needs, activity planning, liaison with supplier managers, measure performance and provide targeted assurance.

RE Site team

AP Manager (key sites) Site FM Roles

HSE Specialist

(large sites)

Regional AP Manager

Territory Manager Regional HSE

Advisor

Site Manager

Real Estate – How Work Gets Done (REPM)

Way Work Gets Done : Common design principles on the way work gets done in Shell covered by a standard Real Estate Process Model which covers FM delivery

Process Guidance : Defined processes in place to confirm how work gets executed by Service Providers and Shell staff

Process Owners : Critical control points built into process design.

Optimise Group Real Estate

Manage Real Estate Deals

Manage Construction and

Refurbishment

Define Site Services

Agreement

Manage Site

Services

Manage Building Integrity

Manage Site

Security

Define Site Services

Agreement

Manage Building Integrity

Manage Site Services

Review performance

On boarding- Services- Organisation- Contracts

Manage Site Security

Review performance

Real Estate – How Work Gets Done (Planon)

Planon : Integrated Workplace Management System (IWMS) selected by Real Estate as the single global standard platform.

Usage : 100,000 Shell staff and contractors have access. 20x standard requests, 40k service requests are managed each month.

Functionality : Modules configured in the Shell implementation to directly support Real Estate Process Model.

Purpose : Visibility of activities carried out by service providers at operational level, enabling Shell to remain in control of building integrity and service performance and to carry out assurance and contract management activities.