Shell brings Kaikias online one year ahead of schedule

Shell Offshore, Inc. (Shell), a subsidiary of Royal Dutch Shell, has started production – around one-year ahead of schedule – at the first phase of Kaikias, a subsea development in the US Gulf of Mexico.

According to Shell’s statement on Thursday, the project’s estimated peak production is 40,000 barrels of oil equivalent per day (boe/d).

Shell noted it has reduced costs by around 30% at this deep-water project since taking the investment decision in early 2017, lowering the forward-looking, break-even price to less than $30 per barrel of oil.

“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 kilometers) 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.