First structure in Norphlet comes online ahead of schedule, below FID estimate
HOUSTON, May 23, 2019 /PRNewswire/ — Royal Dutch Shell plc, through its subsidiary Shell Offshore Inc (Shell) announces today that production has started at the Shell-operated Appomattox floating production system months ahead of schedule, opening a new frontier in the deep-water US Gulf of Mexico. Appomattox, which currently has an expected production of 175,000 barrels of oil equivalent per day (boe/d), is the first commercial discovery now brought into production in the deep-water Gulf of Mexico Norphlet formation.
“That Appomattox was safely brought online ahead of schedule and far under budget is a testament to our ongoing commitment to drive down costs through efficiency improvements during execution,” said Andy Brown, Upstream Director, Royal Dutch Shell. “Appomattox creates a core long-term hub for Shell in the Norphlet through which we can tie back several already discovered fields as well as future discoveries.”
Appomattox is a story of efficiency through innovation. By way of optimised development planning, better designs and fabrication, and expert drilling execution, Appomattox has realised cost reductions of more than 40% since taking final investment decision in 2015. The start of production at Appomattox is only just the beginning of further maximising the flow of resources in the prolific Norphlet surrounding Appomattox.
Shell’s global deep-water business has a strong funnel of development and exploration opportunities in Brazil, the US, Mexico, Nigeria, Malaysia, Mauritania, and the Western Black Sea. Production worldwide is on track to reach more than 900,000 boe/d by 2020 from already discovered, established reservoirs. The company continues to be one of the largest leaseholders in the US deep water and remains one of the most prolific offshore producers of oil and natural gas in the Gulf of Mexico. Shell designs and operates its deep-water projects to be competitive and, since 2014, has reduced its unit development costs and unit operating costs by about 45%.
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Editor’s Notes: – Appomattox is a joint venture between Shell (79%, operator) and CNOOC Petroleum Offshore S.A. Inc., a subsidiary of CNOOC Limited (21%). – The Appomattox floating production system is located approximately 80 miles (129 kilometres) south east of Louisiana in the Gulf of Mexico Norphlet formation, in approximately 7,400 feet (2,255 metres) of water. – In 2010, Appomattox was an industry-first in a series of commercial discoveries by Shell in the Norphlet. – The estimated peak production for Appomattox represents 100% total gross figures. – The Mattox Pipeline Co. LLC (Mattox) is a 90-mile (145 km), 24-inch (61 centimetres) system with a 300,000 barrels per day capacity that will move the produced crude oil from Appomattox westward to the Proteus pipeline system and then onshore. Mattox is jointly owned by Shell GOM Pipeline Company LLC and CNOOC Petroleum Sales U.S.A. Inc., an indirectly wholly-owned subsidiary of CNOOC Limited. – Mattox was completed months ahead of schedule and under budget.