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Shell adds deepwater production in the US Gulf of Mexico

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World Pipelines,


Shell Offshore, Inc. (Shell), a subsidiary of Royal Dutch Shell plc, has announced the early start of production – around one year ahead of schedule – at the first phase of Kaikias, an economically resilient, subsea development in the US Gulf of Mexico with estimated peak production of 40 000 boe/d.

Shell has reduced costs by around 30% at this deepwater project since taking the investment decision in early 2017, lowering the forward-looking, break-even price to less than US$30/bbl.

“We believe Kaikias is the most competitive subsea development in the Gulf of Mexico and a prime example of the deep-water opportunities we’re able to advance with our technical expertise and capital discipline,” said Andy Brown, Upstream Director, Royal Dutch Shell. “In addition to accelerating production for Kaikias, we reduced costs with a simplified well design and the incorporation of existing subsea and processing equipment.”

Kaikias is located in the prolific Mars-Ursa basin around 130 miles (210 km) from the Louisiana coast and is owned by Shell (80% working interest), as operator, and MOEX North America LLC (20% working interest), a wholly owned subsidiary of Mitsui Oil Exploration Co., Ltd.

Royal Dutch Shell pioneered the deepwater industry 40 years ago. In 1Q18, Shell deep water produced around 731 000 boe/d, globally. Over the past four years, the company’s sharp focus on competitive growth has led to planned cuts of around 45% on average for both global deepwater unit development and operating costs.

Read the article online at: https://www.worldpipelines.com/business-news/01062018/shell-adds-deepwater-production-in-the-us-gulf-of-mexico/

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