Moderator: Good Morning all - We will be getting started shortly.

Kim Corley: Looking forward to answering everyone's questions!

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Moderator: Good Morning and welcome to Viewpoint! Today we have Kim Corley, Senior Advisor of CO2 and Environmental Affairs for Shell Oil Company with us to discuss how the world can tackle climate change. Let's get started!

Kim Corley: Hello everyone. It's great to be here and I'm looking forward to this live online discussion on climate change. I see there have been a lot of great questions submitted already - so, let's get started.

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Washington, D.C.: Can you please explain "Cap and Trade" in everyman language?

Kim Corley: As the name implies, there are two components. The cap, which sets a limit on the amount of greenhouse gases industry is permitted to emit. Over time the cap is increasingly reduced until the lower target emission levels are reached. Under the cap, those industries that can quickly and most economically reduce emissions will do so and their reductions create excess allowances - or excess credits, which have economic value. In trade component, industries who cannot quickly and economically meet the capped requirements can buy these excess credits so that the overall cap on emissions is met. As the cap on emissions is reduced, the value of emissions credits increases. This increased value drives development of technologies and creates incentive for industry to reduce their emissions. One of the great things about cap and trade is that it creates the incentive for innovation and development of new technologies to address the climate change challenge.

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Costa Measa, Calif.: How does Shell see itself in 15 years, as an energy company, or as an oil company? And what does that mean in terms of the investment and marketing strategies for Shell?

Kim Corley: We've always seen ourselves as an energy company. For over a century, we've worked to meet the world's energy needs. In fact, we have a 30-year history of biofuel research, development and investment. Over the last five years, we have invested about 1.7 billion in our alternative energy business. This has included wind, solar, biofuels, hydrogen as well as carbon capture technologies.

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Washington, D,C.: What steps is Shell taking to invest in and build viable second generation biofuel options?

Kim Corley: Today Shell buys, trades, stores, blends and distributes biofuels. In fact, we're one of the world's largest distributors of today's transport biofuels. We're conducting research with experts in academic institutions across the world to develop next generation biofuels. We have technical partnerships with the world's leading biotechnology companies including:

Iogen: cellulosic ethanol from straw

CHOREN: synthetic diesel from woodchips

Codexis: building better conversion enzymes

Cellana: growing algae for vegetable oil

Virent: converting plant sugars directly into gasoline.

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Knox, Pa.: How can everyday people help?

Kim Corley: First, get involved. Find energy efficiencies in your everyday life. Turn off the light, unplug your TV, toaster, your hair dryer, recycle, reuse. The Pew Center for Climate Change is a great source for finding ways to reduce your greenhouse gas footprint.

Take a look at their website at http://www.pewclimate.org/

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Oakland, Calif.: How can Shell profit from conservation and CO2 reduction?

Kim Corley: We can all benefit from conservation - or efficiency, as it not only lowers emissions, but also lowers cost. Another way to look at conservation is to look at capturing efficiencies. That is one of what we at Shell call the Six Pathways. In addition to efficiency, the Pathways to reducing greenhouse gases include carbon capture and storage, developing climate change mitigating technologies, low CO2 energy sources, helping our customers use less, and advocating for climate change action.

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London, UK: What is your view of the Waxman-Markey draft bill? Does Shell support the implementation of a cap-and-trade programme in the US?

Kim Corley: Shell is a member the US Climate Action Partnership (USCAP) that includes both industry and non-governmental organizations who have come together to call for legislative action to address climate change. Along with our fellow USCAP members, we have been working with members of congress. USCAP believes the American Clean Energy Act of 2009 broadly embraces the approach recommended by USCAP in the Blueprint for Legislative Action that was issued in January of 2009, I encourage you to visit USCAP website at www.us-cap.org for more information.

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La Jolla, Calif.: Tom Friedman has said that we won't solve this problem & reduce consumption without a significant carbon tax on all fossil forms of energy. What is Shell's response to that statement? What is Shell doing about carbon sequestration? Does Shell support nuclear - including a high-level waste repository?

Kim Corley: We agree with Mr.Friedman that a price on carbon is key to stimulating what he calls innovations in the next great global industry, E.T. (Energy Technology). That's why we support a cap and trade approach to placing a price on carbon as it provides the most efficient and economically viable approach to addressing emissions of greenhouse gases. As for carbon sequestration or CCS, Shell is involved in developing several carbon capture and sequestration demonstration projects worldwide as we move from bringing CCS from demonstration to deployment. We were an early pioneer in the injection of CO2 into oil wells to increase oil production - technology that is the predecessor to today's technology for carbon capture and storage.

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New York, N.Y.: Will the solution to climate change come from companies working independent of one another or combining their efforts to reach the future of energy quicker?

Kim Corley: Climate change is a "global commons" problem and it will take the collective efforts of industry, governments, and everyday people to effect change. In the United States, Shell is a member of USCAP, a group the Wall Street Journal called a "motley crew" because of our diverse profiles from heavy industry to environmental NGOs. In 2007, we came together to issue our 'Call for Action' and in January of this year issued the Blueprint for Legislative Action. We've worked together to call for legislation to slow, stop and reverse the growth of greenhouse gas emissions over the shortest time reasonably achievable. We believe that only by working together, can we address and achieve solutions to the serious issue of climate change.

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Alexandria, Va.: In a gallon of gas - which now costs me about $2.25 - how much profit is there?

Kim Corley: In every country where Shell operates, we strive to provide customers with a consistent supply of competitively priced fuel.

Pump prices are the result of a combination of many factors, which are: 1) tax, 2) the crude price, 3) the international market price for refined products, which may or may not mirror movements in crude prices, 4) exchange rate movements, 5) the competitive nature of the market, and 6) distribution costs.

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Alexandria, Va.: How commercially viable are alternative energy resources for your company today? Do you see a rapid growth in the near future?

Kim Corley: We've invested about $1.7 billion over the last five years in development of alternative energy sources. We have over 550 megawatts of wind capacity (Shell share), three hydrogen fueling stations in the US, and we are a major biofuels distributor. We continue to work on second generation and advanced biofuels, and while much of this technology exists, work continues on both development and deployment of the technologies and on bringing them to meaningful commercial scale. This all takes time.

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La Quinta, Calif.: Are you supporting green initiatives such as solar power, wind power, geo-thermal and wave power?

Kim Corley: In wind, our focus is on operating the Shell share 550 megawatts we currently have, and increasing reliability and safety. We are also an investor AVANCIS, a joint venture working on advanced thin film solar. We are concentrating our efforts on the development of second generation and advanced biofuels as it is clearly aligned with our core business. We believe biofuels could grow to as much as 7-10% of the fuel mix in a few decades.

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Waterford, Ireland: What is your position on the "Hydrogen Economy" and in your opinion does it constitute a realistic replacement for fossil fuels? Would the increased reliance on non-fossil fueled power stations (nuclear etc) mean that it is not scalable in any sort of short term?

Kim Corley:It's important to note that we don't see hydrogen as a "replacement" for fossil fuels but a part of the "mosaic" of various fuels that will be used alongside fossil fuels for many decades to come. Currently Shell is the only international oil company building hydrogen fuel infrastructure in the three key markets: United States, Europe and Asia.

We are working with key players - governments, the automotive industry, NGOs, academia and customers - to make hydrogen a practical, safe and accessible fuel.

In the U.S., we are focusing on the New York and Los Angeles metropolitan areas and we are currently running six demonstration projects: 1) Reykjavik, Iceland; 2) Tokyo, Japan; 3) Washington D.C.; 4) Shanghai, China; 5) White Plains, N.Y.; and 6) Los Angeles, California.

Today, 95% of hydrogen is produced from natural gas at refineries and has lower "well-to-wheel" CO2 emissions than gasoline but is not "green."

If the environmental benefits of hydrogen are to be realized, hydrogen must be produced with a low or even zero CO2 footprint.

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Sanford, Fla.: Since gas for cars and trucks gives off unhealthy byproducts when burned, what about using liquid oxygen? Also, Shell has been promoting a new gas which cleans the engine internally. Is that real or marketing hype?

Kim Corley: I can say from my personal experience, our new Nitrogen Enriched Gasolines really do increase engine performance. I've filled up several times with this gasoline and really noticed increased miles per gallon and better overall performance. You can learn more about this new fuel, fuel conservation tips and more at http://www.shell.us/

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Moderator: That's all we have time for today. Thanks so much for joining us!

Kim Corley: Thank you for your great questions. It's clear that you've given a lot of thought to this topic and we appreciate you sharing your thoughts and time with us today. I hope you will continue to keep climate change issues in the forefront of your thinking and actions. I know we didn't have time to answer all of your questions, but we will work to respond to them. Thank you again. Kim.

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Washington, DC: Can you please tell us more about the demonstration projects.

Kim Corley: Shell is currently building hydrogen fuel infrastructure in the world's three key markets: United States, Europe and Asia.

There are six demonstration projects: 1) Reykjavik, Iceland; 2) Tokyo, Japan; 3) Washington D.C.; 4) Shanghai, China; 5) White Plains, N.Y.; and 6) Los Angeles, California. And, most recently, we opened a hydrogen fueling station in New York at Kennedy Airport.

Our station in Washington, D.C., was the first integrated station (both gasoline and hydrogen) in the United States. Our station in Los Angeles was the first integrated station in California.

You can get more details about these projects at http://www.shell.com/home/content/hydrogen-en/journey/projects/dir_projects_1204.html

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Charleston, WV: Why are gas prices going up again?

Kim Corley: In every country where Shell operates, we strive to provide customers with a consistent supply of competitively priced fuel.

Prices at the pump reflect more than just the price of crude oil. The price we consumers pay for a gallon of gasoline at the pump is the result of a combination of many factors including the international market price for refined products, which may or may not mirror movements in crude prices, fluctuations in currency exchange rates, competition - both international and domestic, distribution costs and various taxes. Many of these factors are influenced by geo-politics and global economic conditions.

You can learn more about the many outside factors affecting prices at the pump and what we do at Shell to help ensure our customers continue to get affordable energy at http://www.shell.us/home/content/usa/aboutshell/energy_challenge/price_at_the_pump/introduction.html

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Anonymous: Would these new cap and trade credits require a market in which to trade? Will there be some oversight or regulation? If so, how much does that cost? Who gets to decide what permits go where? This scheme is just asking for fraud and corruption.

It seems a carbon tax is far simpler. Set a price, and increase until you get to the emission goal.

Kim Corley: Shell has long supported a market-based approach to addressing the critical issue of climate change. We believe a properly designed cap-and-trade program can deliver the best environmental result at the lowest cost to consumers and the economy. In a cap and trade system, companies who have opportunities to reduce emissions quickly and cost effectively will do so and thereby generate "excess" reduction credits. Companies whose GHG emissions abatement opportunities are more costly will be able to buy those excess credits to meet their cap requirements (and remember - to the environment it doesn't matter where the emissions reductions are generated).

As the cap is reduced, the value of emissions credits rises and that provides incentives for companies to invest in process changes, new equipment or new technologies. The ability to optimize investment timing is a critical economic principal. A cap and trade program, with use of offsets and some initial allocation of allowances, provides businesses with options to meet reduction targets so that investments can be made and timed appropriately. This reduces the cost of meeting climate change goals, reduces the risk of stranded capital investment and provides incentives for investments in new technologies.

Allocating allowances in the initial phase of the program also acts to reduce cost to consumers. Over time, allocation of allowances should be phased out in favor of a full auction, while the use of offsets can remain a part of the program for its duration, as both a compliance option and cost-containment feature.

While a properly designed cap and trade system can help reduce the cost of a climate change program, it's important to recognize that there will be a cost. The Waxman-Markey bill includes a strong offset program, provides for allowance allocation that is phased out over time and a significant commitment to key technologies like carbon capture and storage. In addition the bill provides for oversight of the allowance and offset markets. The bill is far from perfect, but it is a starting point from which we will continue to work.

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Evanston, Ill.: What is the driving force behind climate change? What role does the sun play in the earth's climate?

Kim Corley: The scientific evidence is now overwhelming: climate change is a serious global threat, one that demands an urgent worldwide response. There is now a strong scientific consensus that recent changes in our global climate are almost certainly caused by human activity. Carbon dioxide and other greenhouse gases in the atmosphere, in particular from fossil fuel use, deforestation and agriculture, are the main contributors.

The Intergovernmental Panel on Climate Change (IPCC)was established by the UN Environment Programmme and the World Meteorological Organization to study climate change and its potential environmental and socio-economic impacts. The IPPC is made up of thousands of scientists from around the world. The organization issues annual assessment reports and periodically, special reports targeted at specific issues. These reports are an excellent, and very readable, source for the most recent findings and information on climate change. I'd encourage you to take a look at the reports that interest you at http://www.ipcc.ch/ .

As for the sun's role in climate, according to NASA ( http://climate.jpl.nasa.gov/ ), "life on Earth depends on energy coming from the sun. About half the light reaching Earth's atmosphere passes through the air and clouds to the surface, where it is absorbed and then radiated upward in the form of infrared heat. About 90 percent of this heat is then absorbed by the greenhouse gases and radiated back toward the surface. [This] layer of greenhouse gases - primarily carbon dioxide, methane and nitrous oxide - act as a thermal blanket for the Earth, absorbing heat and warming the surface to a life-supporting average of 59 degrees Fahrenheit." There's a wealth of information on NASA's website on climate and many other topics.

You can learn more about what Shell is doing to respond to climate change at http://www.shell.com/home/content/responsible_energy/environment/climate_change/ and http://blogs.shell.com/climatechange/

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Netherlands: Dear Kim - sometimes it is stated that if the Sahara desert would be covered with solar panels the whole world would have enough energy. Is that true? Secondly, why do you think Shell is so attacked on its oil sands position, while Exxon is actually a much bigger oil sands player?

Kim Corley: While I'm not able to confirm whether that statement is accurate or not, Arnulf Jaeger-Waldau of the European Commission's Institute for Energy has said that the capture of just 0.3 percent of the light falling on the Sahara and Middle East deserts would meet all of Europe's energy needs. However, according to an article published by The Guardian in July 2008, such a project "would take many years and huge investment to generate enough solar energy from north Africa to power Europe but envisage that by 2050 it could produce 100 GW, more than the combined electricity output from all sources in the UK, with an investment of around €450bn".

As to your oil sands comment, I won't speculate as to whether Shell receives more scrutiny on our oil sands operations than our competitors. However, you might be interested in a blog referenced by Shell's global climate change advisor David Hone, in one of his January climate change posts (http://blogs.shell.com/climatechange/?s=oil+sands) in which Guardian writer George Monbiot questions Shell's commitments to climate change action as inconsistent with our oil sands business.

A point I would like to make here is that even in our current economic downturn, the demand for energy is growing and, according to many, will double by mid-century. In order to meet that demand it will be necessary to responsibly develop all forms of energy at our disposal - including solar, wind, biofuels - and the fossil fuels that will continue to play a large role in our energy mix for many years to come. This brings to bold relief the need for technologies like carbon capture and storage and other technologies that will help us manage the climate change effects of these energy sources.

Currently, Shell is Canada's third-largest oil sands operator. Representing one of the largest oil deposits on earth, the Canadian oil sands is an important energy source that will help the world meet its energy challenge. With Canadian oils sands production expected to increase to about 3 million barrels per day by 2015, our industry must continue to work toward process and technological answers to environmental issues related to this important energy source.

The Quest project - a potential CCS project of the Athabasca Oil Sands Project, a joint venture of which Shell is a member - is one example of this kind of initiative. Like many others, Shell believes government funding is necessary to facilitate the early development of commercial-scale CCS projects. In 2008, Alberta set aside a $2 billion fund for CCS development projects, and recently the Quest project was selected as one of three CCS projects that Alberta may ultimately support. Although no investment decision has been made, Shell believes the Quest proposal is technically sound, and would contribute to the success of the province of Alberta's energy strategy and oil sands framework.

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Yahaya, Nigeria: Hello Ms. Corley, Biofuel as an alternative to fossil fuel has negative consequences of depleting the world's food reserves. How could this negative aspect be mitigated while at the same time, exploring the benefits biofuel options?

Kim Corley: Cars and trucks account for about 17 percent of energy-related CO2 emissions. Biofuels can help meet the energy challenge, especially by reducing carbon dioxide (CO2) emissions from the transport sector. But biofuels are no silver bullet, and both policymakers and producers need to address a range of issues associated with their use.

For example, the carbon intensity of biofuels can vary widely depending on the raw materials and the production and processing techniques used in manufacture. And, in fact, the carbon intensity of many biofuels may be higher than that of traditional fossil-based transportation fuels.

Availability of large quantities of biofuels is another issue to consider, as is the ability of current infrastructure and automobile fleets to operate on significant quantities of biofuels.

And, as you point out, certain biofuels can compete with food crops for available land. In addition, if not managed appropriately, the cultivation of feedstock for biofuels can result in the destruction of valuable forests, inappropriate water use and have negative socio-economic impacts on local communities and workers.

We've made significant investments in research and development of biofuels. In fact, during the month of June, a Shell station in Ottawa, Canada pumped gasoline blended with 10 percent cellulosic ethanol made from wheat and barley straw. The second-generation biofuel used in this demonstration is produced in Canada by Iogen, a company in which Shell has an ownership stake.

As an industry, we're a number of years away from having large quantities of commercially available next-generation biofuels, but our investments now will help us develop the know-how and market leadership needed to introduce next-generation biofuels that use more sustainable feedstock like straw, wood or even algae and emit even less CO2.

We think commercial volumes of next-generation biofuels, also called second-generation biofuels, could be on the market in five to 10 years. You can learn more about Shell's biofuels strategy and investments at http://www.shell.com/biofuels/

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Carbondale, Pa.: What about all the garbage we produce that is handled so inefficiently? It's been 20 years since curbside recycling started and it seems like all we've done is progress by baby steps. Is it hopeless?

Kim Corley: I think we all agree that "reduce, recycle, reuse" is important in striving for sustainability. And while I can't address curbside recycling and recycling in specific communities or the nation in general, I do think business and industry can play an important role. For example, there are a number of initiatives at Shell where we actively strive to manage our CO2 footprint and promote recycling programs, construct our buildings and projects more efficiently and practice energy conservation efforts as part of our daily work life.

Some of these activities include:

• CO2 reduction activities in plants and operations worldwide, such as developing energy-management plans for office locations to reduce the energy for lighting, heating.

• Building standards and energy-management plans for sites that include adopting sustainable building standards resulting in LEED certification for some of our offices.

• Implementing energy-efficiency programs at our facilities, for example the ENERGIZE program at our Deer Park (Houston) facility.

• Embedding sustainable development into our daily work through a voluntary, employee-led viral grassroots campaign (energy challenge@work) intended to "green" the office through changing staff behavior.

• SEEDS (Shell Employees Encouraging Development for Sustainability) Network, active in U.S.

• Water reduction pilot (washroom fixtures) in some of our buildings.

• "Deskside" recycling programs in our offices.

You can learn more about Shell sustainability efforts in our Sustainability Report at www.shell.com/annualreports.

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Seattle, Wash.: Why did Shell recently abandon its investments in wind and solar, and how does that square with its self-styled green image?

Kim Corley: Over the last several years, Shell has undertaken a strategy to investigate a range of alternative energy and CO2 technologies. In fact, we've invested about $1.7 billion on alternative energy in the last five years. But clearly we don't try to do it all. For example, we have not invested in the development of nuclear, wave or tidal power. We have, however, made serious investments in wind, biofuels, hydrogen and in developing carbon capture technologies.

Today, we are invested in 11 wind projects spread across the U.S. and Europe. The total capacity of these projects is around 1,100 megawatts (Shell share is about 550 megawatts) and all of them are in operation. Out of the total capacity, almost 900 megawatts are in the United States where we have wind farms in Texas, Colorado, Wyoming, California, Iowa and West Virginia. We operate a total of 722 turbines in the U.S. and 170 in Europe.

That said, we've stated previously that we intend to focus our efforts once we have identified where Shell ought to be in alternatives. The one area closest to our core business is biofuels - first, in conventional biofuels that meet our corporate and social responsibility criteria, and second, in research into advanced biofuels technologies that offer better CO2 performance and do not compete with food production.

We will also continue looking into carbon capture and storage (CCS). We stress that both CCS and advanced biofuels technologies are at a very early stages, and it is too soon to know when these can come into commercial scale activities.

You can learn more about Shell and our work in alternative energy solutions at http://www.shell.com/home/content/innovation/alternative_energy/

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Sammamish, Wash.: With the economic downturn putting more people out of work, are we likely to see any benefit from fewer people driving to work since fewer people have jobs? Or on the flip side, since new car sales are slumping, are we likely to see more pollution as people hang on to older cars longer and put off buying newer more environmentally friendly vehicles?

Kim Corley: While it's true that GHG emissions have decreased as a result of the global economic downturn (see IEA's AEO 2009), it's difficult for me to comment on whether the economic downturn will ultimately have a beneficial environmental effect. However, an interesting study commissioned by the Consumer Electronics Association in 2007 indicated that telecommuting could provide CO2 reduction benefits. The study indicated the (then) estimated 3.9 million telecommuters in the U.S. reduced gasoline consumption by about 840 million gallons, while curbing carbon dioxide (CO2) emissions by nearly 14 million tons. This level of CO2 reduction is equal to removing 2 million vehicles from the road every year. ( http://www.ce.org/Press/CurrentNews/press_release_detail.asp?id=11350 )

With regard to air pollution, more stringent fuel and vehicle regulations, combined with investments in technology (in vehicles, fuels and lubricants) will continue to reduce the amount of local pollution a vehicle emits.

As for older cars staying on the road longer, starting this summer the National Highway Traffic Safety Administration (NHTSA) will be administering the "cash for clunkers" program through U.S. car dealers (more information at http://cars.gov; the official federal website). The program provides $3,500-$4,500 vouchers for the purchase of new cars that meet certain fuel economy standards when older vehicles that meet certain standards are traded in.

You can learn more about what Shell is doing to tackle air pollution at http://www.shell.com/home/content/responsible_energy/environment/air_pollution/tackling_air_pollution_17042008.html

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Hoffman Estate, Ill.: I am interested to know about the latest developments in the field of carbon capture technologies. Can we initiate a movement to create public awareness globally in this area while simultaneously providing some kind of monetary benefits/incentives to the individuals who capture the carbon from the emissions of their automobiles/agricultural or industrial equipment? Can the national/provincial or local governments allow/approve similar incentives for carbon capture to the existing power generation companies and other industries emitting carbon in the atmosphere?

Kim Corley: While there is no single solution to the threat of global warming, one of the most promising technologies for rapidly reducing the quantity of global CO2 emissions is carbon capture and storage (CCS). In fact, the Intergovernmental Panel on Climate Change (IPCC) has estimated the economic potential for CCS at between 10 percent and 55 percent of the total carbon mitigation effort through 2100.

For all its promise, however, CCS is a very capital-intensive process, and for that reason, we believe a sound climate change program must include policies to encourage (fund) the development and deployment of CCS technologies. We are encouraged by the inclusion of significant funding for CCS development in the Waxman-Markey bill. Similar efforts are being undertaken in the Canadian approach to climate change where, for example, in 2008 the government of Alberta alone announced a $2 billion fund available for the development of CCS projects in the province.

You mention a need for public awareness of CCS, and I think that's a very important point. Clearly, public understanding of the technologies involved will be a key element in widely deploying CCS successfully. Several non-governmental organizations, including the World Resources Institute (WRI), have done work in the area of stakeholder engagement. For more information on WRI's work, see http://www.wri.org/project/carbon-capture-sequestration.

At Shell, we are actively involved in several CCS demonstration projects around the world, including participation in the Department of Energy's WESTCARB project in California. The WESTCARB project is a research field test pilot program for the underground injection of CO2.

You can learn more about Shell and CCS at http://www.shell.com/home/content/innovation/managing_emissions/reducing_co2/reducing_co2_dir_20080407.html and http://www.shell.com/home/content/responsible_energy/environment/climate_change/

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Green Bay, Wis.: Considering the ice ages and warm periods the earth has experienced since its formation, when exactly has our climate NOT changed? What would be the ideal climate for our planet - Today's climate? The climate of 100 years ago? The climate of 100,000 years ago? How could we pinpoint what an ideal climate is and how could we create this ideal climate?

Kim Corley: You raise some interesting and valid points about climate change. As you state, our world is always changing. However, according to the thousands of scientists who have contributed to the work of the UN's Intergovernmental Panel on Climate Change (IPCC), and thousands of others worldwide, the scientific evidence is now overwhelming: climate change is a serious global threat, one that demands an urgent worldwide response. There is now a strong scientific consensus that recent changes in our global climate are almost certainly caused by human activity.

There are a couple of resources that I'd recommend you check out to learn more about what would be considered an ideal climate, what difference a one-degree change in average annual temperature makes with respect to climate change and perhaps address your question about what is an ideal climate. One is David Hone's blog. David is a Climate Change Advisor at Shell, and he addresses a myriad of climate change issues in his blog at http://blogs.shell.com/climatechange/. A second is NASA's website at http://climate.jpl.nasa.gov/, and a third is the IPCC website at http://www.ipcc.ch/.

You can learn more about what Shell is doing to respond to climate change at http://www.shell.com/home/content/responsible_energy/environment/climate_change/.

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Fennville, Mich.: Why are gas prices rising yet again?

Kim Corley: In every country where Shell operates, we strive to provide customers with a consistent supply of competitively priced fuel.

Prices at the pump reflect more than just the price of crude oil. The price we consumers pay for a gallon of gasoline at the pump is the result of a combination of many factors including the international market price for refined products, which may or may not mirror movements in crude prices, fluctuations in currency exchange rates, competition (both international and domestic), distribution costs and various taxes. Many of these factors are influenced by geo-politics and global economic conditions.

You can learn more about the many outside factors affecting prices at the pump and what we do at Shell to help ensure our customers continue to get affordable energy at http://www.shell.us/home/content/usa/aboutshell/energy_challenge/price_at_the_pump/introduction.html

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Tyler, Tex.: How does Shell deal with the issue of reducing CO2 emissions? In order to move to a lower carbon footprint with the use of natural gas versus oil or coal, CO2 is a common by product of its production. Recent proposed legislation on taxing CO2 emissions could destroy the economics for the transition to natural gas. What is Shell's position on this legislation and how will it deal with its consequences?

Kim Corley: Shell has what we call the "six CO2 reduction pathways." And here I'll be paraphrasing a speech Marvin Odum, the President Shell Oil Company, gave not too long ago that addressed the six pathways.

Some of these may sound quite obvious to you, but they are still very important.

The first is increasing the efficiency of our existing operations. This means thinking about what we already have on the ground and using existing technologies to make that better and more efficient.

The second is to establish significant carbon capture and storage capabilities that are both safe and affordable. Right now affordability is an issue, and that is why government funding for CCS demonstration is so critical.

A third is research and development to lower CO2 intensity of oil and gas production. This means stepping back to before a project is ever designed or decided upon in terms of an investment, but looking at those technologies that make the whole system less CO2-intensive to produce them.

The fourth is to aggressively develop low CO2 energy sources. That includes natural gas, alternatives and renewable fuel options.

Fifth is managing demand, meaning we can help our customers use energy smarter and use less energy. This one is becoming a thriving business on its own.

The sixth and final pathway is working with governments to advocate effective CO2 regulations.

The six CO2 reduction pathways can be found in Shell's 2008 Sustainability Report at www.shell.com/sustainabilityreport

On July 15th, 2009, Shell hosted a web chat titled, "Can technology reduce CO2 emissions?" This chat was hosted by Jan van der Eijk, Chief Technology Officer, as a part of the "Shell Dialogues."

"How does Shell deal with the issue of reducing CO2 emissions?"

With the world's ever-growing demand for energy, CO2 levels are continuing to rise. But what is the role of technology in reducing CO2? Which technologies can help now and in the future; and what is needed to implement these technologies?"

Go to http://www.shelldialogues.com/technologiesforco2

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Columbia, Mo.: How much longer can the oil and petroleum companies maintain their contradictory strategies of fighting climate change legislation while also trying to convince the public they care about the environment?

Kim Corley: You draw focus to what, on the surface, must seem like a conflict of interest, namely energy companies getting involved in the government addressing climate change.

I guess first I'd say (and this might be obvious by now) not all energy companies are fighting against climate change legislation. Shell is proud to be a member of the U.S. Climate Action Partnership (USCAP), along with ConocoPhillips, BP, some 20-plus other business members and five NGOs. This group came together over a two-year period to support U.S. legislative action to fight the effects of climate change. Most recently, in January 2009 the group published its Blueprint for Legislative Action that called for the U.S. to adopt a cap and trade approach to addressing climate change - and we've been encouraged by the fact that many of the recommendations in the Blueprint found their way into the Waxman-Markey bill. For more information on USCAP, visit www.us-cap.org/.

To be sure, this group of companies and NGOs recognize the science on climate change and believe it is in all of our best interests to address the issue sooner rather later. So as you no doubt already understand, the motives here are not solely altruistic. The group also recognizes the fact that addressing climate change will require public support, a dedicated legislative effort and a strong business community.

From a business perspective, certainty around what will be required is essential to making the significant investments that will ultimately be required to reduce GHG emissions. In addition, without federal leadership, business might well be subject to multiple, unlinked state and regional climate change-related programs. Federal action on climate change is the most practical, and cap and trade the most economically feasible approach to this critical problem.

And, U.S. legislative action will almost certainly strengthen our country's global leadership position going into Copenhagen in December. Given that Shell - and many of the other USCAP members - operates in the global business arena, this is an important factor.

Just recently, Marvin Odum, President of Shell Oil Company, made a speech to the Washington Post Climate Change Conference in Washington, D.C. addressing climate, CO2, and sustainability. Part of that trip was to address legislative bodies on the energy challenge before us all. It is clear that Shell is making the effort - both through USCAP and as an individual company - to work with interested parties to create an energy future that is sustainable. We believe that partnership, cooperation, sound business planning, and innovation will keep Shell in the game. And this seems like a plan that benefits everyone.

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Ottawa, Ontario: Dear Kim: I understand that Shell has an ownership stake in a privately owned Canadian company called Iogen, that is developing a process to convert straw to ethanol. How close is that project to commercialization? Will Iogen go public and, if so, when is that anticipated to occur?

Kim Corley: Among others, including Goldman Sachs and PetroCanada, Shell is an investor in Iogen Corporation, a privately owned company whose mission is to develop and commercially deploy second-generation biofuels. From Iogen's website: "Iogen is a world leading biotechnology firm specializing in cellulosic ethanol - a fully renewable, advanced biofuel that can be used in today's cars. Iogen also develops, manufactures and markets enzymes used to modify and improve the processing of natural fibers within the textile, animal feed, and pulp and paper industries."

In June 2009, Shell Canada announced that customers at a Shell service station in Ottawa, Canada would become the first in the world to fill their tanks with gasoline blended with 10 percent cellulosic ethanol, an advanced biofuels, in this instance, made from barley and wheat straw.

I have no information as to if or when Iogen might go public. You can learn more about Iogen at its website at http://www.iogen.ca/.

You can learn more about Shell and biofuels - including our collaborative partnerships with companies striving to find innovative energy solutions - at http://www.shell.com/home/content/aboutshell/our_business/oil_products/fuels/biofuels/biofuels.html

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Washington, D.C.: Good morning, Kim. Two questions for you.

I sense climate change in not really a problem, but just media hype. Your thoughts?

How are companies like Shell working with the auto industry to fix problems related to the environment? Seems there could be some synergies here.

Thanks for responding.

Kim Corley: If it's okay, I'll respond in reverse order. For Shell, the scientific debate about climate change is over. The debate now is about how to address the issue and what we can do about it. We believe that businesses, like ours, must turn CO2 management into a business opportunity and lead the search for responsible ways to manage CO2 and other GHGs, use energy more efficiently and provide the extra energy the world needs to grow.

But public companies, owned by shareholders who expect profitability, cannot do it alone. It requires concerted action by governments to create the long-term, market-based policies needed to make investment in energy efficiency, CO2 mitigation and lower carbon fuels a reality. With fossil fuel use and CO2 levels continuing to grow fast, there is no time for continued inaction.

In the meantime, there are a number of things Shell is doing to address the issue of climate change and impact to the environment. In our own operations, we are:

Working to use energy more efficiently. This includes making the operational changes and investments needed so our refineries and oil and gas production facilities run more efficiently, including further reducing the amount of gas we flare.

Building our capability in CCS. Despite its costs, carbon capture and storage is one of the critical climate change mitigation technologies needed to prevent emissions from rising too far, too fast. We are involved in a number of research-scale projects and met our aim of having at least one project storing CO2 underground during 2008. We are also doing early preparatory work for larger-scale demonstration projects, like the Quest project in Canada.

Continuing to invest in fundamental R&D to deliver new, breakthrough technologies that will further increase energy efficiency and reduce emissions from our operations.

To help our customers reduce their emissions, we are:

Developing lower CO2 sources of energy, including increasing supplies of natural gas and developing transport fuels, including biofuels with lower full-cycle CO2 emissions.

Helping transport and industrial customers use less energy and emit less CO2, for example, by providing advanced Shell Fuel Economy formula and Shell FuelSave fuels in some countries and lower friction lubricants. We also encourage changes in driving habits.

To influence the policy debate, we:

Continue to work with governments, industry, and NGOs to build support for effective policies for CO2 that will speed the pace of change in the energy system.

We do work with auto manufacturers on an array of initiatives, ranging from making lubricants that optimize engine efficiency to designing diesel for racing cars and running fuels efficiency trials. Most recently, we opened hydrogen fueling stations in New York as a result of a partnership among Shell, the Port Authority of New York and New Jersey, the U.S. Department of Energy and General Motors.

Looking forward to future designers of highly efficient vehicles, we host the annual Shell Eco-marathon. The project is a design and performance contest that challenges students around the world to design, build, and test vehicles that travel farther using less energy. The Shell Eco-marathon is an educational platform that encourages innovation, reinforces conservation and fosters the development of leading technology for greater energy efficiency.

You can learn more about Shell and how we're responding to climate change at http://www.shell.com/home/content/responsible_energy/environment/climate_change/

Visit www.shell.com/ecomarathon to see learn more about this event and see how students are achieving incredible results.

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Midland, Mich.: When will the oil companies explore hydrogen as a viable energy source and lobby Congress to put incentives in place for the automobile industry to start making hydrogen cars at an affordable price so people can start buying them? Why isn't Shell being proactive and talking about converting gasoline stations to hydrogen fuel stations?

Kim Corley: Hydrogen is the world's most plentiful element. As a fuel, hydrogen offers the potential to substantially reduce emissions and increase energy security. But, there are obstacles to overcome, as hydrogen requires new engines and fuel delivery infrastructure, making its development and distribution more challenging. Still, hydrogen could become a commercially viable transport fuel in the coming years. Shell already has hydrogen filling stations in the U.S., Europe and Asia and is working to develop mini-hydrogen networks. Shell recently opened a new hydrogen station at New York's Kennedy Airport.

We continue to work with other energy companies to reduce the costs of manufacturing and retailing hydrogen. We also have alliances with many of the world's leading auto manufacturers to advance fuel-cell technology and align the commercial roll-out of vehicles with the fueling infrastructure. Our aim is to provide hydrogen at a price comparable to existing fuels within the next 10 to 20 years, when mass production of hydrogen vehicles could begin.

In 1999, Shell was a founding participant in Icelandic New Energy Ltd., a pioneering project that aims to transform Iceland into a hydrogen economy in the coming decades, with all of its cars, buses and fishing fleets powered by hydrogen fuel cells.

Shell funds hydrogen research at leading universities around the world. We are also supporting the development of fuel-cell technology through venture capital funds in the U.S. and Europe.

We are a member of the EU Hydrogen and Fuel-Cell Technology Platform, the Californian Fuel Cell Partnership and the Japan Hydrogen and Fuel Cell Demonstration Project.

Read more about Shell and Hydrogen at http://www.shell.com/home/content/aboutshell/our_business/oil_products/fuels/hydrogen/hydrogen.html

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Pittsburgh, Pa.: Any progress/hope on oil shale?

Kim Corley: The U.S. Geological Survey estimates the U.S. Rocky Mountain oil shale resources at more than a trillion barrels recoverable - equal to the reserves of the entire Middle East. As you are no doubt aware, the technology for producing these reserves is a challenge. Shell continues to pursue research around oil shale with a cautious, steady approach, and while we are interested in reaching commercial development as soon as feasible, it must be done in a way that is economically viable, environmentally responsible and socially sustainable.

Shell continues to test our technology on private property (Freeze Wall Test) and on federal land through the Bureau of Land Management (BLM) Research, Development and Demonstration leasing program. Shell supports the BLM's efforts to develop and implement a regulatory structure to oversee the prudent development of these important U.S. resources.

Read more about the Shell Mahogany Resource Project at http://www.shell.us/home/content/usa/aboutshell/shell_businesses/upstream/locations_projects/onshore/mahogany/dir_mahogany.html

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Calgary, Alberta: Do you think there remains any doubt whatsoever that manmade CO2 is causing catastrophic climate change? What is your opinion of those scientists who are skeptical of such claims?

What magnitude of temperature rise, in terms of degrees (F or C) do you predict man-made CO2 will cause if we do not take drastic measures?

What magnitude of sea-level rise (height) do you predict man-made CO2 will cause if we do not take drastic measures?

Kim Corley: While I'm not in a position to make predictions concerning the potential impacts of climate change, NASA is a great starting point for information on climate change and its potential effects on earth. Its website can be accessed at http://climate.jpl.nasa.gov/.

As a data point, according to the National Oceanic and Atmospheric Administration's National Centers for Coastal Ocean Science, worldwide sea level has risen nearly 2 mm per year over the last century, which is higher than the average for last several millennia. By 2095, the projected rise worldwide is 18-55 cm.

For the U.S., the Southeast and Gulf coasts are particularly vulnerable. A rise in sea level could have both economic and environmental impacts, ranging from higher and more frequent flooding to loss of coastal habitats. For more information, visit http://www.cop.noaa.gov/stressors/climatechange/current/sea_level_rise.html

As for Shell, based on the results of research done by thousands of scientists around the world, we believe the scientific evidence is now overwhelming: climate change is a serious global threat, one that demands an urgent worldwide response. There is now a strong scientific consensus that recent changes in our global climate are almost certainly caused by human activity. Carbon dioxide and other greenhouse gases in the atmosphere, in particular from fossil fuel use, deforestation and agriculture, are the main contributors.

Shell was one of the first energy companies to acknowledge the threat of climate change; to call for action by governments, our industry and energy users; and to take action ourselves. We have stepped up our appeals to government for urgent and wide-ranging policies, and our own efforts to develop the technologies needed to reduce CO2 emissions from our operations and products.

Read more about Shell and Climate Change at http://www.shell.com/home/content/responsible_energy/environment/climate_change/

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New York, N.Y.: Why not drill for oil on different planets?

Kim Corley: Why go to other planets when there is an abundance of oil and gas here on Earth? Developing those reserves is largely a matter of access and technology. We have the technology today to extract much of that oil and gas and to bring it to market. And we're working on technologies needed to develop even the most technologically challenging energy sources.

One good example is Shell's new technologies to extract oil from ultra-deep waters. The Perdido project, when complete, will be the deepest drilling and production facility in the world and will tie three fields to a regional spar hub for production and development drilling. Perdido's spar hull and topsides processing and living quarters modules will be installed onsite, anchored in nearly 8,000 feet (about a mile and a half) of water over the Alaminos Canyon area in the southwest Gulf of Mexico, 250 miles southwest of Houston. First production from Perdido is expected around the turn of the decade, with the facility capable of handling 130,000 boe/d (100,000 bo/d & 200 mmcfg/d).

As for access, in the U.S. alone, Alaska and the Outer Continental Shelf hold substantial resources that could significantly impact our domestic energy security. However, for years U.S. public policy has denied access to 85 percent of the Outer Continental Shelf resource base for oil and gas exploration. At the same time, we have imported billions of barrels of oil. This decision has cost the U.S. trillions of dollars and thousands of good-paying American jobs.

Read more about Shell and the Perdido Ultra-Deepwater Project: http://www.shell.us/home/content/usa/aboutshell/strategy/major_projects/perdido/perdido_index.html

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Fajardo, Puerto Rico: Is Shell doing anything positive now to tackle the environmental problems or is it waiting for the government to dictate change?

Kim Corley: Shell supports urgent and wide-ranging action to address climate change. Our approach includes reducing CO2 emissions from our operations and products; helping customers manage their emissions by using our products; and advocating the wide-ranging policy changes needed from governments. Additionally, there are a number of things we are doing now to help tackle environmental challenges including:

• Increasing the efficiency of our operations, including efficiency improvements at refineries and the development of energy-efficient, LEED certified buildings. CO2 reduction activities in plants and operations worldwide, such as developing energy management plans for office locations to reduce the energy for lighting and heating; implementing a Green IT program to reduce the environmental impact of IT; embedding sustainable development into our daily work through a voluntary, employee-led viral grassroots campaign (energy challenge@work) intended to "green" the office through changing staff behavior; facilities and construction recycling and materials salvage; and "Deskside" recycling programs in our offices.

• Establishing a substantial capability in carbon dioxide capture and storage (CCS). http://www.shell.us/home/content/usa/aboutshell/media_center/news_and_press_releases/2008/westcarb_collaboration_092908.html

• Continuing to research and develop technologies that increase efficiency and reduce emissions in hydrocarbon production. http://www.shell.us/home/content/usa/innovation/managing_emissions/managing_emissions.html

• Aggressively developing low CO2 sources of energy, including natural gas and low CO2 fuel options. We hold the largest equity share of LNG capacity among private energy companies. We are one of the largest distributors of first-generation biofuels, and we are investing in second-generation biofuels that offer significant CO2 benefits and do not compete with food crops.

LNG: http://www.shell.com/home/content/aboutshell/our_business/gas_and_power/lng/

Biofuels: http://www.shell.com/home/content/aboutshell/our_business/oil_products/fuels/biofuels/biofuels.html

• Helping manage energy demand by growing the market for products and services - like fuel economy formulations for our petrol in some countries and high-efficiency lubricants - that help millions of retail and B2B customers use less energy and emit less CO2.

• By working with governments and advocating the need for more effective CO2 regulation.

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