Shell announces plans to build world’s deepest production facility

Royal Dutch Shell plans to build the world’s deepest production facility in the Gulf of Mexico, the company said Wednesday morning.

The Dutch-based company finalized plans for its ultradeep-water project in the Stones field, which is estimated to contain more than 250 million barrels of oil equivalent in recoverable resources.

The Stone field is in 9,500 feet of water and approximately 200 miles offshore, which company officials said it one of the reasons that it selected a floating production system known as floating production, storage, and offloading vessel (FPSO).

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“This important investment demonstrates our ongoing commitment to usher in the next generation of deepwater developments,” said John Hollowell, executive Vice President for Deepwater, Shell Upstream Americas.

Floating production vessels are better suited to remote locations, where the underwater pipe infrastructure is not as well developed, said Robert Patterson, vice president of deepwater projects for Shell.

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“FPSOs are the most widely used development in deepwater, tied to areas where the reservoirs tend to be widely dispersed, so you can’t reach them with the same platform,” Patterson told FuelFix.

Shell has several tension leg platforms in the Gulf of Mexico, but this project marks its first use of the floating production vessel in the Gulf.

“We make the right choice for the right opportunity,” Patterson said. “In the Gulf of Mexico, in the original discoveries in the Miocene plays, you have a lot of deep reservoirs stacked up in thin layers on top of each other.”

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Patterson explained that these structures made tension leg platforms, which are more stable of their vertical legs, an economical choice, allowing operators to keep drilling and processing equipment on deck, and to take advantage of the underwater pipeline system that has been developed in the shallower waters in the Gulf.

In the deeper waters, however, the infrastructure is sparse and reservoir developments more widely dispersed.

“In deepwater, the question is, how do you get to the the reservoirs, how do you get the hydrocarbons to the surface, how do you treat it and how do you get it to market,” Patterson said.

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Shell will use the floating production to create this wider reach, beginning production of the field with two subsea production wells tied back to the vessel, followed later by six additional production wells.

Shell holds 100% interest in the project and will operate the Stones development.

It also plans to begin operating its Olympus tension leg platform for its Mars-B development project in the Gulf of Mexico. Construction for the Olympus, Shell’s largest tension leg platform, is expected to be completed in the end of May and it is scheduled to be moved to the Mars field at the beginning of June.