Shields, acquired last offseason in a trade from Tampa Bay, went 13-9 with a 3.15 ERA and an AL-leading 228 2-3 innings. Shields was especially strong after the All-Star break, going 9-3 with a 3.06 ERA to help the Royals get into playoff contention.
Kansas City went 43-27 after the break to finish 86-76, its best record since 1989.
"The second half, we pretty much figured it out -- figured out how to win and what it takes on a daily basis," Shields said. "I think going into next spring training, we all have that good frame of mind, that good attitude, and hopefully we'll have a good season next year."
The decision Thursday to exercise Shields' option was mostly a formality. The Royals sent top prospect Wil Myers and a package of other minor leagues to the Rays to acquire him, and they weren't about to let him go after just one season in their rotation.
Especially the way he pitched this season, giving the Royals the kind of bona fide ace that they haven't had since Zack Greinke was plying his trade a few years ago.
"I feel good about it. I feel like I pitched well for them last year," Shields said. "I'm just excited to be back and be a Royal and have a good season next year."
Shields, who earlier Thursday won the Joe Burke Special Achievement Awarded presented by the Kansas City chapter of the Baseball Writers' Association of America, said he hasn't discussed a new contract with Royals general manager Dayton Moore.
He did say he was open to remaining in Kansas City beyond next season.
"When that times comes, I'll definitely be focused on it," Shields said. "The one thing I do know is I love the city. The organization is great. I've been here for one year and we've made tremendous strides. Their willingness to want to win is what intrigues me."
In the meantime, Shields just might become the Royals' best recruiter.
Santana in particular figures to be among the most coveted starters on the free-agent market after going 9-10 with a career-best 3.24 ERA. He threw 211 innings this season.
"You have to understand the business of the game," Shields said, "but we would love to have them back. Bruce brings veteran leadership, Magic brings veteran leadership, and both of those guys had phenomenal years. Magic was lights-out. We counted on him every five days."
The Royals are also in need of help in right field and at second base, so they might be reluctant to give Santana the kind of money that he'll demand on the open market.
They also have several promising arms in the minor leagues, including flamethrower Yordano Ventura and youngster Kyle Zimmer, who expect to compete for a rotation spot in spring training.
"It's been amazing, just the transformation, how this organization has been working the last four or five years," Shields said. "Just to see all the guys that went through the system and how they did this year, and the year we had, was truly amazing."