Royal Dutch Shell (Shell) has selected AT&T to be its global provider of advanced communications services. The five year agreement, estimated to be worth $1.6 billion, calls for AT&T to provide, manage and maintain Shell’s worldwide communications infrastructure while also managing the company’s global mobility needs.

This is one of the largest commercial contracts ever signed by AT&T, and it’s the largest agreement signed with a company that is headquartered in Europe. The agreement is one of three outsourcing contracts signed by Shell with key suppliers for networking and IT services.

AT&T will provide managed network services to Shell and its subsidiary companies in more than 100 countries. AT&T will deliver wide area and local area networks, voice services (including Internet-based telephony), managed security solutions and mobility services. Shell will benefit from access to AT&T’s advanced global Internet Protocol (IP) network to deliver cost effective, consistent, secure and highly reliable services.

AT&T will provide direct connectivity to 1500 Shell corporate and operating unit locations underpinning a range of services critical to Shell’s operations. AT&T will also manage more than 600 separate third party contracts with more than 300 vendors around the world. These contracts include agreements for local connectivity provided by regional telephone companies, contracts with individual service providers and various other maintenance and operations deals.

Shell employees will have access to AT&T’s industry-leading position in the wireless space both within and outside the United States and AT&T will manage the cellular services contracts provided by other mobile operators. AT&T will also support remote data access to Shell’s Virtual Private Network (VPN) service for more than 50,000 traveling users and home-based workers.

Shell will retain core skills within its own IT organization, while being able to access AT&T’s world-class expertise in networking. Plus Shell will benefit from AT&T’s significant economies of scale. Approximately 560 Shell networking professionals located predominantly in the Netherlands, Malaysia, the U.K. and the U.S. are expected to transfer to AT&T, joining the company’s worldwide workforce of 300,000. AT&T will create dedicated service units in these key hubs to ensure that Shell receives continued support at these locations.

Additionally, the contracts reflect how AT&T is capitalizing on the ongoing shift in network traffic from voice to data — and more importantly to IP-based data — as customers migrate from legacy packet networks to Multiprotocol Label Switching (MPLS)-based VPNs and managed applications. The company offers its multinational customer base consistent, resilient, standardized IP services around the world. These services include IP-based VPNs, which use the latest MPLS technology, and are complemented by an advanced portfolio of data-hosting services, applications and leading IP security offerings.