Module I

Case for GTL

Technology
September 18, 2007

Version 1.7
This document is confidential. Neither the whole nor part of this document may be disclosed to any third party without the prior written consent of Shell International Petroleum Company
Limited, London, UK.

The copyright of this document is vested in Shell International Petroleum Company Limited, London, UK. All rights reserved. Neither the whole or part of this document may be
reproduced, stored or in any retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording or otherwise) without the prior written consent of
the copyright owner.

Any external communications must be cleared by GTL BO Program Coordinator and the relevant VP. This covers particularly, but not exclusively, presentations, briefings, reviews,
discussions, editorials, meetings etc with all external parties including competitors, suppliers, industry groups, conferences, consultants, agencies, etc.
The Energy Challenge
Energy demand could more than double by 2050 as the population rises and
developing countries expand economies. Hydrocarbons will continue to provide the
foundation of world energy supply for at least the rest of this century

Rising global energy demand Changing energy mix

300 400
High
350
300
200
Low 250
200
150
100
100
Million barrels oil equivalent per day

50

100 = Global primary energy demand 2000

0 0
2000 2025* 2050* 2000 2025*
Rest of the world Coal Nuclear
OECD Oil Large-scale hydro
*Shell estimates Gas Alt. Energies

2
Meeting the Energy Needs of the Present
without Compromising the Ability of
Future Generations to Meet Their Energy Needs
Shell’s contribution to sustainable development, as a global energy company, has
three dimensions:
Efficiency/economy
o Helping to meet the global energy challenge. (Cheap)
Ca
cap rbon Oil shale
and ture
sto
rag
e HVO
o Improving our operations’ performance, • Hydro
lowering our emissions & our impact on Coal • Natural gas
biodiversity, using less energy, water • ME oil and gas
Oil sands
and other resources. • Geothermal
Energy security Environment
(Convenient) (Clean)
Wave Solar Bio Wind
o Taking steps to improve our social
performance by safeguarding the health
and safety of our employees and Renewables
neighbors, reducing disruptions to the
community, and creating lasting
economic benefits.
3
A Sustainable Future Requires
Agreement Among Governments,
Industry…
! Cooperation between government, industry, NGOs & academia to focus on:
" Prioritization of energy options, including value-based R&D
management
" Energy efficiency/conservation and the environment

! Raising public and industry awareness around the world on “intelligent use
of energy” – a shift in mindset

! Industrial and Automotive manufacturers as the driving force of quicker and

practical actions towards Energy Efficiency

! Identification of Large Cities as prime target for air emissions controls for
energy users

! Solutions Leadership – requires a step-change in the effectiveness of the

product offerings from manufacturers (Automotive, Lubricant, Fuel)
4
Meanwhile, National Regulations Are
Tightening

The marketplace will see stricter regulations than ever before in history for
engine and drive-train designs, well-to-wheel.

Fuel and lubricant performance must also rise to new, never-before-seen,

levels to help OEMs meet the requirements.

This calls for the next generation of fuels and lubricants.

5
A Sustainable Future Requires a
Change in Approach
Climate change issues are fundamentally changing energy & automotive
industries’ priorities.

Improving performance plus Energy fuel Emissions Equipment

efficiency control durability

6
Shell’s Answer for How to Best Support
Your Future Requirements

Expand & Capitalize on our Expertise in Gas to Liquid Technology

Finished lubricants made with GTL Base Oils deliver state of the art performance
while helping to
• Reduce emissions and improve fuel economy
compared to those formulated with current common base oil slates.

• GTL Base Oils are less volatile and with superior low temperature
properties, and thus they enable lubricants to be routinely blended to
lower viscosity grades which also improve fuel efficiency in vehicles.

And Shell is working to bring these benefits to customers in more countries

consistently as the significant volume of GTL Base Oils come online around the
end of the decade.

7
Shell is Best Placed to Develop & Deliver
Sustainable Solutions
First International Oil Company with a Commercial GTL Plant in
Operation in Bintulu, Malaysia

Producing GTL Base Oil commercially since 1993 using feed stocks
from our Bintulu plant…

…Formulating for use in our highest

performing tier of finished lubricants

This expertise, and previous success, led us to think big.

8
GTL Project in Qatar:
Due on stream around the end of the decade, this will be the largest GTL plant
in the world.

It will produce 140,000 barrels

per day of GTL products South Pars
including fuel, chemical / North
Field
feedstock and lubricant
base oils.

Production of GTL base oils

will be very significant –
increasing to more than
one million tonnes per annum.

Enabling this project to become

the first world-scale producer
of GTL Base Oils.
9
Project Overview
Ethane
Propane
Butane
North Field Condensate
Sulphur

GTL Naphtha
GTL Fuel
n-Paraffins
GTL BaseOils
Water
Ras
Laffan Fully integrated project: “From Reservoir to Market’
2002: Statement of Intent
2003: Heads of Agreement (HOA)
Doha
2004: Development Production Sharing Agreement (DPSA)
2005: Front End Engineering Design (FEED) completed
2006: Submission of Final Development Plan
Final Investment Decision – July 2006
2007: Broke Ground for Construction
First production around the end of the decade
10
Summary

Shell is finding ingenious and unconventional solutions to the ongoing

increase in energy demand and tighter regulations.

Shell is the global expert in GTL Technology and is committed to building

on our successful history to become the first world-scale GTL Base Oil
producer.

We have the technological expertise and the commitment to bring the

largest GTL Base Oil plant online around the end of the decade.

When you are ready to know more, we are ready to share with you the
initial diagnostics that are driving our continued investment in GTL
Technology.

11
 Module II

GTL Technology:
Initial Diagnostics
September 18, 2007

Version 1.7
This document is confidential. Neither the whole nor part of this document may be disclosed to any third party without the prior written consent of Shell International Petroleum Company
Limited, London, UK.

The copyright of this document is vested in Shell International Petroleum Company Limited, London, UK. All rights reserved. Neither the whole or part of this document may be
reproduced, stored or in any retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording or otherwise) without the prior written consent of
the copyright owner.

Any external communications must be cleared by GTL BO Program Coordinator and the relevant VP. This covers particularly, but not exclusively, presentations, briefings, reviews,
discussions, editorials, meetings etc with all external parties including competitors, suppliers, industry groups, conferences, consultants, agencies, etc.
Only Shell Will Have GTL Base Oils at
Commercial Scale

13
Project Overview
Ethane
Propane
Butane
North Field Condensate
Sulphur

GTL Naphtha
GTL Fuel
n-Paraffins
GTL BaseOils
Water
Ras
Laffan Fully integrated project: “From Reservoir to Market’
2002: Statement of Intent
2003: Heads of Agreement (HOA)
Doha
2004: Development Production Sharing Agreement (DPSA)
2005: Front End Engineering Design (FEED) completed
2006: Submission of Final Development Plan
Final Investment Decision – July 2006
2007: Broke Ground for Construction
First production around the end of the decade
14
A Variety of GTL Products -- A Breadth
of Finished Lubricants
The Pearl GTL Project – a joint project between Shell and Qatar Petroleum – will
produce a range of GTL products ranging from naphtha through to fuels and
base oils.

The Base Oil Project will produce base oil in the viscosity range of 3 through 8
cSt (100°C).

The total of Shell Slate GTL Base Oil will be > 1 million tonnes per annum,
following the expected supply start date around the end of the decade.

Base oils will be Shell Group III

GTL base oils will have specifications and performance benefits meeting and
exceeding those of current Shell Group III (Shell XHVI) base oil production

15
Shell GTL Base Oils Typical Properties &
Product Applications
The base oils will be catalytically de-waxed
--consequently very good pour point depressant responses
Shell GTL Base Oils – Typical Properties
Shell GTL Base Oil 3 cSt 4cSt 5 cSt 8 cSt

o
Vk100 C (cSt) - 3.8 - 4.2 4.8 – 5.4 7.5 – 8.5

The uninhibited pour points will Vk 40oC (cSt) <11 - - -

typically range from –30oC for

VI 119 135 145 150
the 4 cSt to –15oC for the 8 cSt
grade VdCCS, -30oC - 1000 1860 5300

o
The base stocks will have exceptional Pour Point, C < -42 < -30 < -24 <-15

Brookfield viscosity performance for

Noack, %m - 12 9 2
automatic transmission formulation
blending Flash Point, oC (D-93) 186 215 232 240

The 3 cSt grade:

• have a pour point suitable for many applications that today require naphthenic base oils
• meet ‘readily biodegradable’ criteria according to OECD 301-B requirements
16
Shell GTL Technology will enable The
Next Generation of Lubricants
GTL Base Oils offer opportunities to formulate toward across-the-board
improvement in finished lubricant performance.

! Improved product performance

defined here as the key benefits that
Governments, OEMs, Influencers,
Customers and Consumers want
most, and that new regulations will
require:
– Reduced Emissions
– Improved Engine Durability
– After-treatment Device
Compatibility
– Enable Energy Efficiency

17
Compared to Group I & II Base Oil, GTL
Technology Offers:
Outstanding Oxidative Stability
! formulated oil oxidation stability/additive response to prevent oil thickening
! no impurities to contribute to lube-derived emissions
Lower Volatility
! reduced evaporation of hydrocarbons or high temperatures relative to Group
I & II base oil and most current (hydrocracked) Group III base oil
! this allows the use of thinner oils = which will deliver an urban cycle fuel
economy advantage
! Easily meets OEMs most demanding volatility requirements
! Oil consumption through volatility loss will be less
Higher Viscosity Index (VI)
! Uses lower polymer viscosity modifier (VM) treat – with proven benefit --
enhanced engine cleanliness and more shear-stable viscosity
! Able to blend some multi-grade motor oils with no VM at all
o VI of BO VM treat o VdCCS mPa.s
Vk100 C Vk100 C
2 blend %w 2 o
mm /s of BO mm /s of -25 C, of finished
blend lube lube
Mineral Gp III A 6.26 132 13.71 14.17 6850
Mineral Gp III B 6.24 131 12.8 14.18 6556
Shell GTL blend 7.63 148 188.9 14.17 6540
Improved Oxidative Performance from
GTL Base Oils
Shell GTL Base Oils mark a significant improvement in the overall
chemical composition of Group III base oils, particularly:

• Delivering improved additive antioxidant response

• Improving the ability to extract improved oil drain intervals

from GTL-based formulations at constant additive treat
rates

" in the TU5-JP oxidation engine test, GTL-based

formulations, compared to market general Group III
base stocks, demonstrated an increase of around 15
hours before the onset of oxidative thickening

19
Easier Blending of Low Volatility - Low
Viscosity Finished Lubricants, Formulated
to Deliver Fuel Efficiency and Emissions Benefits
GTL base oils provide good low-temperature performance without compromising
volatility.
Shell GTL Base Oils
" GTL base oils mark a Comparing Volatility vs Cold Crank Viscosity
18

significant improvement in Noack evaporative loss as a function of Cold

16
Crank Viscosity @ -30oC
the volatility vs. cold crank
14 Hydrowax based Gp III
viscosity master curve. 4 cSt
12 Slack wax based
GpIII
Shell GTL- Pearl production
10 typicals
5 cSt
" This enables motor oils to 8

loss / % weight
Noack evaporative
be routinely blended as 6

lower viscosity multigrades 4

which can improve fuel desired direction 8 cSt

2
efficiency in vehicles, while
0
maintaining engine 0 1000 2000 3000 4000 5000 6000 7000 8000 9000
o
durability. VdCCS@ -30 C /cP

20
GTL Base Oils Help Improve Wear
Performance of Finished Lubricants
Shell GTL base stocks have lower cold crank viscosity, grade for grade, than
Group III cat de-waxed base stocks
Thus Shell GTL base stocks allow formulation blends with a higher base oil
viscosity contribution relative to the viscosity modifier contribution
This will contribute to wear performance benefits in non-conformal / Elasto-
Hydrodynamic type contacts
Durability is demonstrated in a Cummins ISM engine test for a GTL
technology HDEO at a lower than normal viscosity for HDEO .
Cummins ISM HDEO Engine HDDEO Low SAPS HDDEO Low SAPS ACEA E7
Test SAE 5W-30 slack SAE 5W-30 Shell Limits
Comparative wax based Gp III GTL Gp III
P content (%w) 0.05 0.05
Cummins ISM
Crosshead mass loss (mg) 7.5 6.3 7.5 max
Performance (adjusted to 3.9%w soot)
Top ring mass loss (mg) 68 60.6

21
 GTL Technology-Based Lubricants
Help Improve Engine Cleanliness
The low cold crank viscosity of Shell GTL base stocks allows blending with a lower viscosity
modifier treat and higher base oil viscosity relative to mineral Group III base oils. This will
normally deliver engine cleanliness benefits.
o VI of BO VM treat o VdCCS mPa.s
Vk100 C Vk100 C
In the limit, it becomes 2 blend %w 2 o
mm /s of BO mm /s of -25 C, of finished
easier to blend a blend lube lube
viscosity modifier-free Mineral Gp III A 6.26 132 13.71 14.17 6850
Mineral Gp III B 6.24 131 12.8 14.18 6556
multigrade formulation Shell GTL blend 7.63 148 8.9 14.17 6540
with a GTL Group III
Base Oil than with a
mineral based Group
III base oil.
Comparative Nissan TD-25 Performance
HDEO low SAPS 5W-40 HDEO low SAPS
hydrowax based Gp III 5W-40 Shell GTL JASO limits

top groove fill, %m 57.1 37 60% max

residual carbon/piston
detergency, %m 4.94 4.15 -

22
GTL Technology-Based Lubricants Help
Improve Emissions Performance

GTL diesel fuel delivers significantly reduced NOx emissions from diesel engines
- Resulting from higher cetane values and the lower peak flame temperature

Shell GTL based lubricant formulations, tested in a MAN Euro 3 heavy duty diesel
engine, provided NOx emissions improvements on top of the GTL diesel fuel benefit.

measured GTL Fuel NOx GTL Base Oil NOx Combined

NOx / benefit benefit benefit GTL
g/kWh* lube + GTL
diesel
Mineral Gp III lube + LS diesel 5.01 - - -
Mineral Gp III lube + GTL diesel 4.61 - - -
Mineral Gp III lube - 8.1% -
LS diesel - - 5.2% -
GTL lube + LS diesel 4.75 - - -
GTL lube + GTL diesel 4.39 - - -
GTL lube - 7.6% - -
GTL diesel - - 4.7% -
Combined benefit GTL lube + GTL diesel
- - - 12.4%
*corrected to constant fuel consumption as measured by total CO2
precision in measuring NOx (95% confidence limit) better than 0.04 g/kWh or ~1% relative

23
GTL Technology Delivers Frictional &
Viscometric Performance for Transmissions

GTL Base Oils are essentially iso-paraffinic base oils

This leads to a low frictional coefficient under high pressure conditions – a fundamental
property of iso-paraffins
Shell GTL Base oils have frictional coefficients intermediate between those of PAO and
mineral derived Group III base oils
Therefore, for transmission formulations where a number of frictional properties are
normally optimized, Shell GTL Base Oils provide most of the compositional benefits of
PAO (inhibited oxidative stability) together with a desired higher frictional coefficient
This should assist long ODI and fill-for-life (automatic) transmission formulations
3000 cycle dynamic quasi static
We have observed that in
DKA friction friction static friction
clutch tests, the dynamic,
test coeff. friction coeff.
quasi-static and static
coeff.
frictional coefficients are all
mineral hydrowax Gp III 0.130 0.092 0.109
directionally greater than
PAO Gp IV 0.130 0.093 0.106
those of PAOs GTL Gp III 0.131 0.096 0.108
24
Shell GTL Base Oils have frictional
characteristics similar to PAOs
Comparison of friction data for iso-viscous (40C) base oil blends
EHD contacts*

0.12

0.10

0.08

0.06 Naphthenic white oil

mineral Gp II
0.04 mineral Gp III

Coefficient of friction
Shell GTL
0.02
PAO

0.00
1 10 100 1000 10000
Mean Speed [mm/s]
*1 G.Pa applied pressure 10% slide/ roll
25
GTL Base Stocks have Exceptional
Potential for Automatic Transmission
Formulation Blending
Comparison of Shell GTL and mineral Gp III Brookfield viscosity –40oC
of 8 cSt fluids

120,000
> 105
solidified
100,000

80,000

60,000

40,000

20,000

Brookfield viscosity, -40oC, cP

0
PAO 8 Shell GTL Shell GTL Pearl Gp III hydrowax 1 Gp III hydrowax 2
Experimental

26
Summary

Shell’s GTL Technology will enable the next generation of finished

lubricants:

• GTL Base Oil will be available around the end of the decade and
will provide significant quantities (> 1 million tonnes per annum) of
highest quality GTL base stocks.
• Shell GTL Technology will allow blending of low viscosity, low
volatility formulations with superior hydrocarbon composition that will
assist OEMs in their goals for:
"Wear performance
"Durable energy efficient lubricants
"Greater emissions control
"Engine and gear box durability

27
 TBD

Module III
September 16, 2007

Version 1 draft – In Process

This document is confidential. Neither the whole nor part of this document may be disclosed to any third party without the prior written consent of Shell International Petroleum Company
Limited, London, UK.

The copyright of this document is vested in Shell International Petroleum Company Limited, London, UK. All rights reserved. Neither the whole or part of this document may be
reproduced, stored or in any retrieval system or transmitted in any form or by any means (electronic, mechanical, reprographic, recording or otherwise) without the prior written consent of
the copyright owner.

Any external communications must be cleared by GTL BO Program Coordinator and the relevant VP. This covers particularly, but not exclusively, presentations, briefings, reviews,
discussions, editorials, meetings etc with all external parties including competitors, suppliers, industry groups, conferences, consultants, agencies, etc.