John presenting at press Conference

The world is changing, and at Shell we look at these changes quite closely as they are important to our businesses globally including the Bitumen business. The world’s population is growing at a rapid pace with urbanisation as a mega-trend. In addition to that, individual empowerment with digitalised and user-centered services and applications is increasing at a tremendous pace, changing the way we live and do business. Climate change is a big issue as well and whilst there are some people who still don’t believe in it, at Shell we do. It is a harsh reality, but if we don’t control global warming below 2°C, the impact for mankind might be catastrophic.

The way people connect is also changing; autonomous cars will soon invade our streets. Indeed, 70% of our cars may be autonomous in the very near future. But there are some who believe that we can’t mix autonomous driving and human driving, we have to make a complete shift, not just a little one. For this we will need to make vehicles capable of interacting between themselves and with other parts of the environment in which they operate, and that creates problems for our current pavements.

Address the needs of tomorrow’s massive urbanisation

Congestion is going to be a major problem for our cities. We expect nine billion people to be roaming the planet by 2030, with 70% of them living in cities. Consequently, we will have 31 mega cities by 2030, which is only 12 years away. Traffic is going to at least double if not triple, with pollution growing rapidly if we don’t act.  At Shell, we believe that we need a global carbon charge as this will help boost innovation and give us the best chance of controlling climate change to below 2°C.

Traffic noise is also one of the biggest issues in cities and, as these are growing to become mega cities, this issue will become even greater. Safety is also key, as more traffic can generate more safety issues for pedestrians and cyclists.

Are we going to see more fatalities? The answer is yes, unless we do something. What does this mean in our view? We need a connected ecosystem, where cars, roads, traffic signage are all integrated so they can work seamlessly and safely.

More cars will be equipped with batteries so that means that we need to equip fuel stations with the right mix of technologies: be it hybrid, fast battery charging or hydrogen. However, in terms of innovation, can we actually make a road which can generate electricity by itself and charge vehicles as you drive? Maybe in the future, instead of going to fuel station you’ll just drive along the section of the road which will recharge your vehicle, and you’ll pay a pence or a cent per mile. Who knows?

Shared access to vehicles is extremely important. Why? Because the way people think about vehicles is changing. Today, it’s about moving people and goods from A to B. Tomorrow it will be about social connectivity. It will be about people sitting in their cars, on their mobile phones, talking to each other. The action of moving will no longer be the only reason for being in a car. So the question could be: what else can we make roads do in addition to moving people and goods from A to B?

Roads must get better in what they do. Autonomous vehicles will be able to drive much closer to each other than we do now. So the roads’ recovery time between each passing car will decrease, meaning the damage which is done by each of these vehicles will be much higher. In addition to that, people will want more and more load per vehicle, that will also do more damage to our roads. Consequently, our roads have to get better at what they do: they need to last longer; they have to be designed for that purpose. Today’s roads designs are looking backwards (empirical design), but they should be looking forward (analytical design) with predictive damage mechanics according to the type of traffic. If possible, they even should be self-repairing. If you look at the global road network, the entire world doesn’t have enough money to repair the roads it has today and this network is expanding. In the past we used to design our roads for twenty years, but the average maintenance period for our roads is eighty years. So, there is already a real disconnect between the money available and the road network that we have and are developing.

Roads need also to be safer. They should have clear binders which may glow in the dark to enhance visibility but also to reduce ambient street lighting so we can use less energy. We would need more consistent skid resistance as well, because if you have an autonomous vehicle - unless it can really sense if a road is very slippery or less slippery - then consistent skid resistance will be a must so we can make sure autonomous cars can all stop when they need to.

We will also need to provide cleaner solutions, whether it is to reduce odor or to neutralize it. We will have to use more recycled material and finally we will need to find less noisy solutions.

Smart and multi-skilled roads

Roads will have to get smarter. They must do other things than just allow for people to move. They will be required to fight air pollution by capturing polluting particles and generate energy by capturing solar, kinetic or piezoelectric energy. Why not use movement on the road to generate electricity and pump it out to the grid so we can reduce the amounts of carbon needed to generate electricity? In the summer it could be a good way to generate money from the road network a well as reducing the heat island effect. In the winter electricity could be converted to heat which will then defrost the road so we don’t have to apply winter maintenance.

Roads will also need to perform at high standards in extreme climate conditions, during flash flooding periods for example. We need pavements to be able to take that water away and to survive much longer in these conditions. Even the 2°C change that is being discussed can make a huge difference in the pavement lifecycle. So looking forward, we will need to take that into account when designing roads.

There is a lot of innovation out there but we are still very conservative in the road construction industry. If we take the example of polymer modified bitumen, Shell developed them fifty years ago. Yet, they are still not widespread across the entire world. Innovation needs to be accepted far more quickly. The industry needs more engagement. The industry needs society and public stakeholders to fully indorse innovation in roads and this needs to be initiated and come to fruition in real projects and not just talked to. We all need collaboration because no company or government can do this on their own. All stakeholders have to work together to address the issues of tomorrow’s roads and do much more than we have done in the past.

If we really want to make the roads of the future, what do we need? We need a new framework. The traditional way of contracting for our roads is not suitable for the future. It needs collaborative engagement and innovative mindsets so we can finally change our roads and deliver everything required by our society in the future. 

Enquiries:

H+K Strategies: Metin Parlak, metin.parlak@hkstrategies.com, +44 207 413 3338

Shell Bitumen Global: Oliver Lim, o.lim@shell.com, +656477 7499

Royal Dutch Shell plc

Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges. Shell companies have operations in more than 70 countries and territories with businesses including oil and gas exploration and production; production and marketing of liquefied natural gas and gas to liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects. For further information, visit www.shell.com.

Cautionary note

The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this press release “Shell”, “Shell group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Royal Dutch Shell plc and subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this press release refer to entities over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated arrangements over which Shell has joint control are generally referred to as “joint ventures” and “joint operations”, respectively. Entities over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.

This press release contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results of operations and businesses of Royal Dutch Shell. 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 Royal Dutch Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as “aim”, “ambition’, ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, “schedule”, ‘‘seek’’, ‘‘should’’, ‘‘target’’, ‘‘will’’ and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this press release, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell’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. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this press release 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 Royal Dutch Shell’s 20-F for the year ended December 31, 2017 (available at www.shell.com/investor and www.sec.gov). These risk factors also expressly qualify all forward looking statements contained in this press release and should be considered by the reader. Each forward-looking statement speaks only as of the date of this press release, June 8 2018. Neither Royal Dutch Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this press release.

We may have used certain terms, such as resources, in this press release that United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.

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