The Courier & Advertiser (Perth and Perthshire Edition)
Shell to revitalise Penguins field
Shell is to begin drilling in the North Sea’s Penguins oil and gas field in the firm’s first manned project in the upper end of the region for almost 30 years.
The energy giant said the redevelopment of the field will include the addition of a floating production, storage and offloading vessel (FPSO) that will eventually be home to up to 70 operational personnel.
Discovered in 1974, Penguins was first developed in 2002 and is a 50% joint venture between Shell and ExxonMobil.
It is expected that between 300 and 400 jobs will be created during the construction phase of the project.
Shell said it expected peak production of around 45,000 barrels of oil per day once the redeveloped Penguins was fully commissioned .
Andy Brown, Shell’s upstream director, said: “Penguins demonstrates the importance of Shell’s North Sea assets to the company’s upstream portfolio.
“It is another example of how we are unlocking development opportunities, with lower costs, in support of Shell’s transformation into a world-class investment case.”
The Penguins field processes oil and gas using four existing drill centres and its redevelopment will see an additional eight wells drilled.
Natural gas will be exported through the tie-in of existing subsea facilities and additional pipeline infrastructure.
The field is in 165 metres of water and located 150 miles north-east of the Shetland Islands.
It comes amid a resurgence in oil prices, which has seen Brent touch 70 US dollars a barrel in recent weeks.
Steve Phimister, vice-president for upstream in the UK and Ireland, added: “Having reshaped our portfolio over the last 12 months, we now plan to grow our North Sea production through our core production assets.
“In doing so, we will continue to work with the UK Government, our partners and the regulator to maximise the economic recovery in one of Shell’s heartlands.”
Shell’s decision to redevelop Penguins was hailed by Oil & Gas UK chief executive Deirdre Michie.
She said: “A global leader like Shell making a commitment on this scale demonstrates the investment potential the UK Continental Shelf still holds.
“It also shows the importance of the efficiency improvements our industry has delivered which have helped make redevelopment projects like this commercially attractive.”