Our Lady of Fatima University

Senior High School

Accountancy, Business and Management

Submitted by:

Francine Rev G. Reantaso

Nathaniel Mark Ymana

Jose Darwin T. Belenson

Kian Anthony Dela Cruz

ABM MGT-12

February 18, 2019

Submitted to:
 COMPANY BACKGROUND

Shell Oil Company is the United States-based wholly owned subsidiary of Royal Dutch Shell,
transnational corporation "oil major" of Anglo-Dutch origins, which is amongst the largest oil
companies in the world. Approximately 22,000 Shell employees are based in the U.S. The U.S.
headquarters are in Houston, Texas. Shell Oil Company, including its consolidated companies and
its share in equity companies, is one of America's largest oil and natural gas producers, natural gas
marketers, gasoline marketers and petrochemical manufacturers.

Shell is the market leader through approximately 25,000 Shell-branded gas stations in the U.S.
which also serve as Shell's most visible public presence. At its gas stations Shell provides diesel
fuel, gasoline and LPG. Shell Oil Company was a 50/50 partner with the Saudi Arabian
government-owned oil company Saudi Aramco in Motiva Enterprises, a refining and marketing
joint venture which owns and operates three oil refineries on the Gulf Coast of the United States.
However, Shell is currently divesting its interest in Motiva.

The Shell Oil Company Warehouse, built in 1925 and located at 425 S. N. 16th Ave. Phoenix,
Arizona. It is listed in the National Register of Historic Places. Reference #85002073

Shell gas sign, also in Phoenix

A Shell gas station near Lost Hills, California

Shell products include oils, fuels, and car services as well as exploration, production, and refining
of petroleum products. The Shell Oil Refinery in Martinez, California, the first Shell refinery in
the United States, supplies Shell and Texaco stations in the West and Midwest.

Shell gasolines previously included the RU2000 and SU2000 lines (later there was a SU2000E)
but they have been superseded by the V-Power line.

In 1997, Shell and Texaco entered into two refining/marketing joint ventures. One combined their
Midwestern and Western operations and was known as Equilon. The other, known as Motiva
Enterprises, combined the Eastern and Gulf Coast operations of Shell Oil and Star Enterprise, itself
a joint venture between Saudi Aramco and Texaco.

After Texaco merged with Chevron in 2001, Shell purchased Texaco's shares in the joint ventures.
In 2002, Shell began converting these Texaco stations to the Shell brand, a process that was to be
completed by June 2004 and was called "the largest retail re-branding initiative in American
business history". In the year 2016, Shell Nederland Raffinaderij BV (Shell Pernis) said that it has
started a new aromatics unit at the large Pernis refinery in Rotterdam, Netherlands.

In recent years The Shell Oil Company's Midstream, and Downstream, in particular, have become
limited to petroleum, and chemical products. This has come as a result of Royal Dutch Shell
breaking off its Natural Gas and power businesses in to a new segment named Integrated Gas. The
Shell Oil Company's former Natural Gas, and energy divisions are now Shell Energy North
America, a closely integrated, but distinctive entity that runs across North America and is
headquartered out of Houston.

OUR VISION

They make the difference through our people, a team of dedicated professionals, who value our
customers, deliver on our promises and contribute to sustainable development.

OUR MISSION:

To safely market and distribute energy and petrochemical products while offering innovative
value-added services.
 Products and Services

Shell Fuel Technical Services

Delivering technical excellence to your operations with Shell Fuel Technical Services

The right choice of fuels can offer you optimized fuel consumption, lower operating costs and
easier maintenance. Using the most professional fuels management protocols will keep your
chosen fuels in good condition and support your sites in complying with the highest safety and
environmental standards. Shell's team of fuels experts can help with your fuel’s issues. Our
technical experts and scientist offer technical knowledge on product applications and practical
advice on fuels quality and fuels handling issues. We are passionate about helping customers to
use our products effectively, so that they bring maximum value to your businesses.

Shell Fuel Advisor service

Shell Fuel Advisor service provides technical expertise relating to fuel system quality assurance,
product selection, troubleshooting fuels-related applications issues and assisting with the
implementation of premium products. The service is delivered through teams of highly trained
technical staff both offices based and in the field. Selecting the right fuel for the right application
helps to ensure that your operations run efficiently, disruptions are minimized and costs reduced.
Making use of expert fuels advice leaves you free to concentrate on maximizing production for
your business.

Shell Fuel Expert

Shell Fuel Expert is a specialist fuels management, product training and inspection service
designed for customers who have their own fuels storage facilities. Our Fuel experts will conduct
a detailed assessment at your fuel farm designed to offer you a thorough evaluation of all fuels-
related activities in your business. The assessment is designed to give you a new perspective
 STRENGTH WEAKNESSES
 Strong Market Position  Violating corruption laws
 Vertically integration  Growing Debt
 Strong exploration capability 
 Strong Research and Development:

OPPORTUNITIES THREATS
 Prelude Floating Liquefied natural gas
 Climate change concerns
technology Partnership
 Susceptible to political volatility
 Increasing global energy demand:
 Strategic Merger of the BG Group:
 Planned Expansions
STRENGTH

Strong Market Position: Shell has upstream and downstream operations in over 70 countries
around the world. It is one of the largest oil companies in the world and has various fuel brands
under the umbrella of Shell, for example, Shell V-Power, Shell LPG etc. A strong global market
position gives Shell a significant bargaining power in the industry.

Vertically integration: Shell has successfully integrated its business operations vertically by
engaging in exploration and production of natural gas, crude oil etc. In the upstream market, Shell
is involved in exploration and production whereas, in the downstream market, it is involved in
marketing refined products. The vertical integration gives Shell a competitive advantage over
quality control and cost benefits.

Strong exploration capability: Shell has invested heavily in developing and implementing
technology for exploration. With the use of airborne and geophysical data, Shell has developed its
methods for exploration of oil and gas and thus has been able to efficiently explore more oil and
gas in the recent past. This has also decreased US’s over dependence on Gulf countries for fuel.

Strong Research and Development: Shell has been constantly trying to improve its technologies
in order to decrease its carbon footprint and develop methods to explore more fuel in less effort.
Shell has made the sustained investment in its R&D and also has a wide series of patents under its
banner. Strong R&D provides the competitive advantage and helps in reducing expenditure.
WEAKNESSES

Violating corruption laws: In July 2007, Shell Oil was involved in violating corruption laws in
the US in the case of using freight forwarding Panalpina and violating corruption rules from the
Foreign Corrupt Practices Act (FCPA). The company was fined $30 million penalty. Such
violations affect brand image and goodwill.

Growing Debt: Shell has experience increase in debt in the past few years. The company’s debt
increased from $37774 million in FY2012 to $58379 million in FY2015. Increasing debt
increases business risks and a subsequent portion of the cash flow is paid in interest. Increasing
financial obligations may affect the business in future.

OPPORTUNITIES

Prelude Floating Liquefied natural gas technology Partnership: The Prelude floating
liquefied natural gas (FLNG) Technology partnership will allow Shell to access offshore gas
fields that are difficult to develop. The Prelude FLNG program will produce 5.3 million tonnes
of liquids per annum once fully operational. Such initiatives will take care of the demands of the
future.

Increasing global energy demand: According to the US Energy Information Administration

(EIA), the total world energy consumption will increase by 40% by the year 2040. Demand for
cleaner energy resources is also increasing. Shell is well positioned to take control of the
potential demands in the future.

Strategic Merger of the BG Group: Shell merged with BG Group plc in the year 2016 which
gives it a strong hold in the offshore of Brazil and Australia. Brazil and Australia have rich oil
and gas resources and thus it puts Shell in a better position as compared to competitors.

Planned Expansions: Shell has been focusing on expanding its operations strategically across
the globe in order to cater to energy demands of the developed and emerging nations in the
future. The company has also entered merger or JV deals with companies in some nations like
China to set up its footprint in those markets.
THREATS

Climate change concerns: With increasing energy demands, carbon dioxide emission in
production as well as upstream is expected to increase which needs to be under control for Shell.
Shell needs to find a solution to reduce its carbon dioxide emissions otherwise Shell may have to
face increasing costs and/or stricter regulations.

Susceptible to political volatility: Oil and Gas have been the most important subject of
discussions between countries in the last 100 years. Politics have revolved around energy demands
and production. Thus, presence in many countries puts Shell in a disadvantage of becoming a
victim of any political development in the future.