Shell gives green light for Whale development in Gulf of Mexico

Shell Offshore, a subsidiary of oil major Royal Dutch Shell, has made a final investment decision (FID) for Whale, a deep-water development in the U.S. Gulf of Mexico.

Shell said on Monday that the Whale development features a 99 per cent replicated hull and an 80 per cent replication of the topsides from the Vito project.

Wael Sawan, Shell upstream director, stated: “Whale is the latest demonstration of our focus on simplification, replication and capital projects with shorter cycle times to drive greater value from our advantaged positions.

“We are building on more than 40 years of deep-water expertise to deliver competitive projects that yield high-margin barrels so that we can meet the energy demands of today while generating the cash required to help fund the development of the energy of the future”.

Whale will be the second Shell-operated deep-water development in the Gulf of Mexico to employ a simplified, cost-efficient host design. With this development approach, Shell anticipates an internal rate of return estimated to be greater than 25 per cent.

The Whale development will feature energy-efficient gas turbines and compression systems. This development will be the latest addition to our Gulf of Mexico portfolio where our production is among the lowest greenhouse gas (GHG) intensity in the world for producing oil.

The project, owned by Shell (60 per cent operator) and Chevron (40 per cent), is expected to reach peak production of approximately 100,000 barrels of oil equivalent per day (boe/d) and currently has an estimated, recoverable resource volume of 490 million boe.

Whale will be Shell’s 12th deep-water host in the Gulf of Mexico and is currently scheduled to begin production in 2024.

The production facility is located in the Alaminos Canyon Block 773 and is adjacent to the Shell-operated Silvertip field, approximately 10 miles from the Shell-operated Perdido platform and approximately 200 miles southwest of Houston.

It was discovered in 2017 and will feature a semi-submersible production host in more than 8,600 feet of water with 15 oil-producing wells.