By Ron Bousso and Karolin Schaps

LONDON (Reuters) - Royal Dutch Shell <RDSa.L> plans to increase cost savings to $4.5 billion following its $54 billion acquisition of BG Group which Chief Executive Officer Ben van Beurden said will make it the best oil company investment, ahead of Exxon Mobil <XOM.N>.

In its first long-term strategy presentation since February's deal, Shell unveiled plans to limit spending and exit countries in order to focus on the most profitable operations such as liquefied natural gas (LNG), deepwater oil production and chemicals.

The company also detailed longer-term plans to grow its shale oil and gas production and green energy as it switches to cleaner resources.

The combination of BG catapulted Shell to the world's second biggest international oil company behind Exxon by market capitalisation and production. Shell became the top liquefied natural gas trader and a major deepwater oil producer by increasing its position in Australia and Brazil.

Van Beurden hopes the new strategy to generate double digit returns will boost investor confidence and lift Shell's share price which has underperformed rivals since the BG deal was announced in April last year. The deal also doubled its debt-to-equity ratio to 26 percent, leading to credit rating downgrades.

"For the first 90 years of Shell's existence... we were the industry leader in total shareholder return. But we lost the lead in the 1990s," said the 58-year-old Dutchman, who was appointed in early 2014.

"I am determined to get us back to that number one position."

Shell targets a 10 percent return in capital employed by the end of the decade, assuming an oil price of around $60 a barrel, up from around 8 percent between 2013 and 2015.

Shell's year-to-date total return was minus 3.2 percent while Exxon shares offered returns of 10 percent, according to Thomson Reuters data.

The Anglo-Dutch company has been the only one among the group of 'oil majors' to make a large acquisition in the current downturn, as rivals focused on cutting spending.

"With all promises to shareholders maintained and lower forward capex than many thought possible, Shell in their own words is 'creating a world class investment case' which we agree with," said analysts at Bernstein, who rate Shell 'outperform'.

Shell's shares were up 2.4 pct to 1742 pence by 1342 GMT.

EXITS

A key element of van Beurden's plan will include narrowing its global activity. Shell said on Tuesday it will exit oil and gas operations in up to 10 countries and sell 10 percent of its production as part of a $30 billion asset sale plan by 2018.

The company is active in more than 70 countries but wants to focus on 13 nations, including Brazil, Australia and the United States. It did not say which countries it might exit. Reuters has reported that Shell plans to sell its assets in Gabon.

Shell lowered its planned 2016 capex to $29 billion, with exploration set at $2.5 billion, in a third cut from an initial $35 billion. Cost savings will come from 12,500 job cuts in 2015 and this year and overlaps in operations in areas including Australia, Brazil and the North Sea.

The company said its medium-term growth priorities were deepwater projects in Brazil and the Gulf of Mexico and its chemicals division, particularly in the United States and China.

Deepwater production could double to some 900,000 barrels of oil equivalent per day in 2020.

It also gave the go-ahead for investing in a new cracker and polyethylene plant in the United States, one of a handful of investment decisions this year as it grapples with the sharp drop in oil prices over the past two years.

Shell will slow new investment in its integrated gas business, which includes LNG, which it said has "reached critical mass following the BG acquisition".

In the long term, the company said it would target shale oil and gas production in North America and Argentina as well as biofuels, hydrogen, solar and wind in a new energies unit.

(Editing by Mark Potter, Jason Neely and Alexandra Hudson)