LONDON: Royal Dutch/Shell will build the world’s deepest offshore oil and gas facility, pushing the boundaries of industry technology to search three kilometers underwater in the Gulf of Mexico.
The project go-ahead demonstrates Shell’s confidence in pricey offshore projects despite a recent downturn in oil prices.
BP recently decided to delay development of its biggest new Gulf of Mexico project, Mad Dog Phase 2, citing tough market conditions and fast-rising costs.
Shell’s 100 percent-owned Stones field was discovered in 2005 some 200 miles southwest of New Orleans and encompasses eight lease blocks in the Gulf of Mexico’s Lower Tertiary geologic trend — one which produced the Anglo-Dutch oil company’s Perdido development.
Perdido, at 9,365 feet below the surface, is the world’s deepest offshore well. The Stones field is deeper, at 9,500 feet (2,896 meters).
Production during the first phase of Stones is expected to have an annual peak of 50,000 barrels of oil equivalent per day, Shell said in a statement.
Shell will build a floating production, storage, and offloading (FPSO) vessel and subsea infrastructure.
The FPSO will be able to “weathervane” in the wind to reduce stress on the structure.
It will be moored using a combination of polyester rope and chain and, at a later stage, a new generation of super-efficient sea floor pumping technology will be used.
“This important investment demonstrates our ongoing commitment to usher in the next generation of deepwater developments, which will deliver more production growth in the Americas,” said John Hollowell, Executive Vice President for Deepwater, Shell Upstream Americas.
Shell to drill world’s deepest offshore oil well
