Royal Dutch Shell, through its subsidiary Shell Offshore has announced 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.
According to Shell, Appomattox, which currently has an expected production of 175,000 barrels of oil equivalent per day, 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,” Royal Dutch Shell Upstream Director Andy Brown said on 23 May. “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,” he added.
Shell said that 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 barrels of oil equivalent by 2020 from already discovered, established reservoirs, Shell said, adding that 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%.