Deepwater Meeting Demand

7/30/2019 Deepwater Meeting Demand

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Deepwater


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Perdido, Gul o Mexico, USA


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SHAPING DEVELOPMENTS IN DEEPWATER

DEEPWATER CREDIBILITY

EMPHASIS ON SAFETY

STATE-OF-THE-ART PROjECTS

LOOKING TO THE FUTURE

DRILLING INNOVATION

s d d .............................................................5Combined innovation and integration | Facing up to the challenges | Comprehensive skillset |Personal ownership and abiding principles

e f..........................................................................................9Wells must be sae | Ready to respond containment initiatives

D .........................................................................................13Taking the lead in drilling Noble Bully I and II | Exploring the deep |Cost-eective well intervention

D d....................................................................................19Concrete giant | Shells TLP product line | Ten years later, a new TLP |Avoiding the need or surace acilities | Field host unlocks dispersed feld economics |Milestones in oating storage production and ooading (FPSO) acility development

s-f-- j.................................................................................25Parque das Conchas | Perdido

l f......................................................................................29Technology and innovation commitment | Technology ow into new exciting areas |Standardisation and leveraging globalisation | Helping develop peoples skills


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Perdido Spar construction, Pori, Finland

Continual investment in

people, technology and

project capabilities has

enabled Shell to orge

a prominent position

in deepwater


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Perdido Spar sail away rom KiewitYard to the Gul o Mexico, USA

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combineD innovation anD integrationThe Perdido development in the Gul o Mexico is the latest anddeepest in a series o Shell deepwater successes stretching backmore than 30 years. The Perdido topsides rest on a buoyant spar,the combined structure being almost the height o the Eiel towerin Paris. Moored in 2,450 metres o water, this is the deepestcombined drilling and production platorm in the world. ThePerdido development also boasts the worlds deepest subsea

well. The well is in Tobago feld, 2,934 metres down on theseabed. Tobago feld broke the world water-depth record orsubsea production, which was previously held by another feld inthe Perdido development: Silvertip feld at 2,852 metres o wate r.

The Perdido development was only possible through a series otechnology frsts across a range o disciplines. This combinationo technology innovation and integration is paramount.

It is undamental to the continuous progress that we have madesince the beginning o the deepwater era, which can be tracedback to the early 1980s.

Continual investment in people, technology and projectcapabilities has enabled Shell to orge a prominent position indeepwater. Our record now includes more than 20 successuldeepwater projects, many o them groundbreaking. We have

a strong presence in both established and emerging deepwaterprovinces around the world. Shells 30+ years o deepwateroperations in the Gul o Mexico produce an average Shell-shareo about 187 thousand barrels o oil equivalent per day.The Perdido acility sits over our oil and gas reservoirs.We expect it to ultimately connect 35 wells through a networko pipes on the seaoor. The acility is expected to produce about100,000 barrels o oil equivalent per day.

Perdido Spar construction, Pori, Finland

Shaping developmentsin deepwater


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SHAPING DEVELOPMENTS IN DEEPWATER

beginning in Deepwater

In 1978, Shell installed the Cognac platorm in the Gul o Mexico in three sections, excluding the deck. It sitson the seabed in 330 metres o water. The photo shows the Bullwinkle platorm, which was installed 10 yearslater in 412 metres o water as a single section, excluding the deck module. This platorm still holds the worldrecord or the tallest ixed jacket structure ever placed in the sea: rom the sealoor to the tip o the lare stack,the structure is about twice the height o the Eiel tower in Paris. The Bullwinkle platorm is signiicant becauseit marks the limit o what can be achieved using traditional oshore technology. It heralds the beginning o aperiod when Shell and others in the industry advanced the rontiers o oil and gas exploration and productionas never beore.

Facing up to the challengesThree words best summarise the challenges associated withdeepwater development: scale, complexity and extremity.Challenges revolve around the installation o equipment, oaccess to the seabed and o bridging the distance betweenthe seabed and the surace. The extended water column exertshuge pressures on oilfeld equipment, which consequently hasto be stronger than normal. As an example, the vital riser pipesused or drilling and production become heavier the deeperthe water, which creates specifc design challenges in termso their atigue lie and the way they interace with surace andseabed acilities.

Platorms become bigger and more complicated toaccommodate the hardware requirements and cope withthe massive loads involved. O course, the natural environmentdoes not help. When working in deeper water, which isgenerally urther oshore, the weather conditions, the waveorces and the currents can be extreme, which adds to thechallenge o designing adequate acilities. Seabed temperaturesalso all towards reezing, which raises the issue o hydrateormation and makes ow assurance a particularly importantdeepwater technology ocus.

And the challenges do not end once production begins.Every aspect o oilfeld operations and logistics, especially thoseinvolving well intervention, has to be viewed in a new and otencostly light.

Shells 30+ years o deepwater operations in the Gul o Mexico produce an average Shell-share o about

187 thousand barrels o oil equivalent per day


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Ongoing investment in research and development over the yearshas underpinned Shells ability to continuously extend thedeepwater rontier. Our overall research and developmentexpenditure was more than $1.1 billion in 2011, once again thehighest among the international oil companies. Developingoptimum technology solutions also requires us to look outwards. Theability to capitalise on the skills and abilities o other industry playersand specialist oilfeld services companies is vital to success.

comprehensive skillsetDeepwater resources are vital to help meet the worlds risingenergy demand. Resources o over 80 billion barrels o oilequivalent are estimated in the Gul o Mexico, Brazil andNigeria deepwater regions alone.

Technology is the key to unlocking these massive resources o oiland gas, and the scale required should not be underestimated.The complexity o most deepwater projects and the uniquechallenges each presents call or an unusually comprehensive

surace and subsurace technology skillset: one that spans theentire oilfeld lie-cycle.

personal ownership anD abiDingprinciplesAll this innovation and integration would be impossible withoutthe right people and the best minds within our organisation.The knowledge, experience and imagination o the peopleworking at our Deepwater Centre o Excellence in Houston, USA,and at closely linked regional hubs in New Orleans, USA;Stavanger, Norway; Kuala Lumpur, Malaysia; and Lagos, Nigeria,provide us with a competitive edge. It is they who take ownershipo the challenges we ace and who embody Shells abiding

principle o providing or the worlds energy needs in ways that aresae, aordable and environmentally sustainable, regardless o t hepractical challenges.

Continual investment in research and development coupled with the ability to capitalise on the skills and

abilities o other industry players and specialist oilfeld services companies is vital to success

Cognac1978

Bullwinkle1988

Auger1993

Mars1996

Olympusin progress

Ram-Powell1997

Bonga2005

Ormen Lange2007

Ursa1999

Gumusut-Kakapin progress

Parque das Conchas2010

Na Kika2003

Perdido2010

Mensa1997

600m

800m

1,000m

1,200m

1,400m

1,600m

1,800m

2,000m

2,200m

2,400m


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Troika splashing BOP assembly, USA

We have a highly

developed asset integritymanagement system

covering all aspects o

our operations


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Ormen Lange, Norway

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Shell has health, saety and environmental (HSE) standardsthat rank among the most robust in the world and maintains the

necessary management procedures to ensure they are aithullyapplied. We have a highly developed asset integritymanagement system covering all aspects o our operations.For well integrity, we have specifc sotware tools, wh ich aretried and tested in hydrocarbon provinces with ageing wellstocks, to help us manage the operation, maintenance andworkover o wells or their long-term reliability and saety.

wells must be saFeSae well operations demand highly competent people,strict saety procedures and rigorous design, constructionand maintenance standards or all equipment. Shell applies

a multilayered well control system designed to minimise risks,so that i any system or device ails it should not lead to loss ocontainment. As well as primarily ocussing on prevention, wealso work on secondary (cap-and-contain) well control toolsand techniques to shut o subsea wells saely and quicklyater an uncontrolled release o hydrocarbons.

The Deepwater Horizon disaster in the Macondo feld, Gul oMexico, in 2010, had a proound impact on t he industry, andinstigated a thorough review o our approach to deepwater

development, especially in terms o drilling and wellconstruction. Despite our utmost confdence in Shells standardwell designs and construction procedures, we are ocusing on aseries o measures to urther reduce the chance o a catastrophicwell ailure.

Our work has centred on blowout preventer (BOP) stacks thatrequire less manual intervention and shut down problem wellsautomatically. We are developing explosive well severancesystems to augment the hydraulic rams normally used in BOPs.

Emphasis on saety

Blowout preventer


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EMPHASIS ON SAFETY

MWCC capping stack (Courtesy: Marine Well Containment Company)

We are engaged in a range o initiatives and projects to develop

improved well capping systems

In addition, we are employing well designs that can survivecomplete loss o well control and then shut o the ow at theseabed.

In March 2011, Shell became the frst oil and gas company tobe awarded a permit to drill a new exploration well in the Gulo Mexico ollowing the Deepwater Horizon oil spill in April2010. This demonstrated the credibility o our robust approach

to saety and operating responsibly, which is based on rigorousglobal standards and practices.

reaDy to responD containmentinitiativesHowever small the chance o a well suering a blowout othe kind at Macondo, we have to accept that it cannot becompletely ruled out. For that reason, we are engaged in arange o initiatives and projects to develop improved cappingsystems to suppress wells that are releasing oil and gas intothe sea.

Shell has already designed a modular capping system or its

own deepwater wells or easy transportation anywhere in theworld. We are also working on an Arctic version dedicated tocapping Shell wells in Alaska. Shell, along with ExxonMobil,Chevron and ConocoPhillips, ormed the Marine WellContainment Company, a not-or-proft, independent companythat provides well containment equipment and technology in thedeepwater U.S. Gul o Mexico. The company has developedan interim response system that will provide rapid containmentresponse capabilities in the event o a potential utureunderwater well control incident in the deepwater Gul oMexico and is developing an expanded system. The majorityo the expanded containment system will be complete in 2012

with the remaining equipment arriving in 2013.

Shell is also leading the International Subsea Well ResponseProject rom its ofce in Stavanger, Norway. The project hasnine oil company members and is initially assessing equipmentand operating plans to accelerate and improve the industrysresponse to serious well ailures. This is likely to lead to thedesign o new capping systems.

Shell capping stack


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Dealing with aDversity saFelyHurricane Katrina swept through the Gul o Mexicoin 2005 causing serious damage to oil and gasinstallations. Shells Mars ield tension-leg platorm(TLP) and its wells survived the extreme weatherconditions but the platorms drilling rig toppledand various production acilities were badly

aected. The ields 18-inch oil and 14-inch gasexport pipelines also suered damage when ananchor belonging to a driting semisubmersibledrilling rig dragged across them during the storm.

The complex exercise to repair the platormacilities was planned in detail and meticulouspreparations were made oshore beore the1,000-tonne drilling rig was lited away rom theplatorm in two pieces to be repaired onshore.Ultimately, achieving this lit without aecting acritical, high-pressure gas-treatment vesselunderneath the rig was key to resuming production

ahead o schedule.

The industry-irst pipeline repair in 600 metreso water was accomplished using an emergencysystem Shell developed with this sort o event inmind. Subsea robots controlled rom the suracecut out cracked sections and replaced them withjumpers.

This unprecedented project consumed more thanone million work-hours, during which time therewere no recordable injuries. The project received

a National Ocean Industries Association awardand an Energy Institute award or technology.Oshore Engineering also named it project o the

year. In r ecognition o his pe rsonal contri butio n,the Shell project leader received a corporateleadership award rom the U.S. Department othe Interior.

Repair works subsea robots


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12Noble Bully II

Over the past several years,

Shell has made a series o

important advances that

promise to change the

ace o deepwater well

operations


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Noble Bully I

Drilling anD completion recorDsShell was the driving orce behind the deploymento worlds irst semisubmersible drilling rig, theBluewater 1, in the Gul o Mexico in 1961.In 1993, our Auger TLP was the irst loatingdeepwater platorm in the Gul o Mexico to havea ull drilling rig. The Perdido platorm is currentlythe worlds deepest ull drilling and production

platorm. We have achieved a series o drillingwater depth records over the past 30 years.We have also set and then broken our own recordsor the deepest subsea well completion in theGul o Mexico: West Cameron, the irst subseacompletion (1961); Tahoe, 460 metres (1994);Popeye, 610 metres (1995); Mensa, 1,650 metres(1997); and Perdido, 2,900 metres (2009).

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taking the leaD in Drilling noble bully i anD ii

The highly innovative Noble Bully rig design is the result o aconcerted development programme in collaboration withleading drilling contractor Noble Corporation. The rigs, whichentered service in late 2011 and early 2012, are based on arevolutionary concept: a oating drilling rig with all the attributesand unctionality o the latest fth-generation drillships but withlower capital and operating costs and a reduced environmentalootprint.

Working with Noble, we have achieved that. Noble Bully I andII are signifcantly lighter and shorter than comparable capacitydrillships. Locating the pipe storage in the hull o the vessel and

having a compact, box-type, multipurpose drilling tower ratherthan a conventional drilling derrick ensure its stability. The vesselscan drill in water depths up to 3,000 metres deep.

Noble Clyde Boudreaux semisubmersible drilling rig(Courtesy Noble Corporation)

Drilling innovation


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DRILLING INNOVATION

Perdido, USA

The vessels also boast the latest electronic engine controls andan advanced dynamic positioning system, which preserves uelconsumption and cost, and helps to reduce carbon dioxideemissions by over 100,000 tonnes per year compared withdeepwater drillships with the same capabilities.

exploring the DeepTechnology has a crucial role in providing the inormationwith which to make sound deepwater exploration decisions.Given the complexity and high cost o drilling in deepwater,there is great value in being able to identiy the best spots to

drill exploration wells, to frst place the bit. This skill hinges onour ability to generate an accurate and comprehensive pictureo the Earths subsurace. Seismic technology lies at the hearto this process and is a key research priority or Shell.

Working with various specialist technology entities, wehave driven advances in wide-azimuth, ocean-bottom seismicsurveying that have cast new light on deepwater reservoirs lyingbelow thick salt ormations, which were previously notoriouslychallenging to image. We have enjoyed spectacular successusing this technique to explore the Deimos subsalt prospect inmore than 1,000 metres o water depth in the Gul o Mexico.At the site o a costly earlier dry hole, the prospect has yielded

two new discoveries, the West Boreas and South Deimos felds.These have added signifcantly to the reserves fgures or thealready prolifc Mars basin and we are currently developingthem as part o the massive Mars B project. The new technologywas also instrumental in a more recent discovery in the sameregion: the large Appomattox feld.

I there is a downside to ocean-bottom seismic surveying,especially in deep water, it is the laborious and costly tasko deploying the numerous sensors over the target area. In animaginative attempt to simpliy this task and to reduce the timeand costs involved, Shell is working with GO Science to

develop Flying Nodes. These sel-propelled Nodes can beprogrammed to dive through the water to defned locations inthe survey area up to 100 kilometres rom the launch point.Once in position on the seabed, they will gather seismic datauntil commanded to return to the survey vessel or datadownloading. A trial with 5 Flying Nodes is planned in the Gulo Mexico or the summer o 2012. A larger trial with 50 isplanned or 2013.

Technology has a crucial role in providing the inormation to make sound deepwater exploration decisions

key economic DriversThe cost o hiring a deepwater drilling rig can beup to $1 million dollars per day.

The cost o a deepwater well splits roughly equallybetween drilling and completion work. The ormeris impossible without a drilling rig but, in the caseo the latter, the situation is ar less clear-cut. Theability to complete deepwater wells without a rigprovides huge economic beneits.

Oil recovery rates rom subsea wells are typically inthe range 35 to 45%. Pushing these rates higher byintervention to work over or modiy producing wellsis oten uneconomic owing to the cost o bringingin a drilling rig. Rigless well intervention has thepotential to alter ield production economicsradically in deepwater.


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Construction Olympus TLP hull, Mars B proect, South Korea

cost-eFFective well interventionFor clear economic reasons, it makes sense to seek alternativesto using a drilling rig or completing deepwater wells and anysubsequent intervention. Shell could not be more driven by thisobjective and, over the past several years, t he organisation hasmade a series o important advances that promise to changethe ace o deepwater well operations.

For the past ew years, we have been able to install oilfeld treeson wires rom a workboat equipped with a simple A-rame ora crane. We frst did this in the Gul o Mexico and since thenat Ormen Lange feld, Norway, and Bonga feld, Nigeria.

We also now have initial well clean-up procedures that arepossible via the host acility rather than a drilling rig, and wecan perorm acid stimulation work in deepwater we lls rom aboat. Most impressively, we can conduct open-water wirelinework in water depths to about 2,000 metres. Many thoughtthis would be impossible owing to vortex-induced vibration (VIV)instability issues. In 2009, we successully replaced a valve in850 metres o water in the Gul o Mexico using this technique.At the beginning o 2011, we also used it in Bonga feldoshore Nigeria in 1,155 metres o water and saved millions odollars. In June 2011, we set a depth record in Brazil in 1,890metres o water.

We have plans to build a system or inter ventions on caissonelectrical submersible pumps without using a drilling rig.In 2010, we fnished our frst open-water completion in themulti-feld Parque das Conchas project oshore Brazil: the frststep in building technology and lessons learned or doing thisrom a boat.


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AUGER 1993

Advanced integrated design/analysis tool s/PDMS Coupled global response anal ysis Response based criteria State of the ar t model testing Multiphase flow and hydrateinhibitors

Water depth record

drill & produce platform

ASCE civil engineering

award

Fully integrated drilling rig

MARS 1996

Depressurisation/

blowdown philosophy

RAM-POWELL 1997

Replication of the Mars TLP

URSA 1999

TLP schedule & cost

improvements

Electrically heated flowlines

Deployment on a wire

Steel helically woundumbilicals

Pipeline connectionand repair

BRUTUS 2001 NA KIKA 2003

Pipe-in-pipe electrical

heating ready flowlines

and risers

Shallow water flow

mitigation

First TLP to use the

upper column frame

to isolate topsides

from wave forces

Oil storage in hull

Low motion SEMI in

2,000 metres water depth

Improved Mars design and

construction processes to

reduce cost & schedule

Water depth record

dry tree platform

Water depth record TLP Investment in flexibility Start development of

novel spar concepts

Hydrocarbon dewpoint

control

15,000 ton super lift

SUBSEA ADVANCES

1994 2012+

DEEPWATER PROJECTS

DEEPWATER TECHNOLOGY DEVELOPMENT AND NEW


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OLYMPUS IN PROGRESS

NEW CHALLENGESAND OPPORTUNITIES

Arctic

Floating liquefiednatural gas (FLNG)

Subsea separation and boosting

High pressure, high temperatureapplications

Cost effective wells

Deepwater waterflood and EOR

Continuous project executionimprovement

Advanced design visualisation, data integration and automation tools Standard systems implementation in projects

BONGA 2005

First application of steel

centenary risers for an FPSO

Shells largest FPSO

to date with 225 kbbls/d

net processing capacity

First deepwater project

offshore Nigeria

Multiple subsea FPSO

Subsea separation

and boosting

PARQUE DAS CONCHAS

2010 PERDIDO 2010

Heavy oil

Single lift topsides

Ultra deepwater spar

Post-hurricane Katrina metoceandesign criteria

Forefront of major GOM deep-water developments post Macondo

1st TLP utilisation of passivehull design

6th Shell GOM TLP - enhancevalue via concept replication

1st GOM deepwaterbrownfield development

Extends life of prolific Marsfield to 2060

Smart Fields technology

First Shell deepwater

project in Malaysia

GUMUSUT-KAKAP

IN PROGRESS

Spread-moored FPSO

HORIZONS


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Brutus platorm, Gul o Mexico, USA

Over an eight-year period,

between 1993 and 2001,

Shell installed fve TLPs in

the Gul o Mexico


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Tow-out o the Trollproduction platorm

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You can be as imaginative as possible, you can drive innovationrelentlessly, and you can develop world-class technology across

the widest possible spectrum, as Shell patently has done.But nothing is achievable without the know-how and the skillsto execute these enormous, complex deepwater projects.

Inevitably, they involve multiple partners and legions ocontractors, specialist equipment manuacturers and serviceproviders, all eager to play their part but requiring inspirationalleadership and an integrating orce to make it all happen.This is where experience counts, and where Shell excels.

concrete giantThe Troll A platorm is worthy o inclusion in any catalogue odeepwater achievements. It is the centrepiece o Troll feld inthe Norwegian North Sea, which contains 40% o Norwaysgas reserves. Four enormous concrete legs that reach down toa concrete gravity base 303 metres below the seas suracesupport the production topsides, which can process over 100million cubic metres per day o natural gas. Installed in 1995and weighing 700,000 tonnes without ballast, Troll A remainsthe biggest concrete platorm in the deepest water anywhere

in the world. It is also the tallest structure ever moved over thesurace o the Earth by human beings.

Equally notable about this development is the close co-operationbetween Shell, the feld developer, and Statoil, the feldsproducing operator. This led to a seamless and highly eectivehandover as the giant platorm came to lie.

shells tlp proDuct lineOver the eight-year period between 1993 and 2001, Shellinstalled fve TLPs in the Gul o Mexico. The frst, in Auger feldin 870 metres o water, was then the worlds only TLP to haveull drilling and production capabilities. The Auger feld owlineswere the frst laid in deep water using the near-vertical J-lay

Auger production platorm, Gul o Mexico, USA

Deepwater credibility


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Centralised surveillance, the Bridge,New Orleans, USA

technique, which Shell had developed some years earlier. Augerfeld was also the frst to employ steel catenary risers, whichhave since become the preerred riser technology or deepwaterfeld developments worldwide. Shell is now planning to tie backthe subsea Cardamom feld t o the Auger TLP.

Following Auger was the Mars TLP in 900 metres o water in1996; then the Ram Powell TLP in 980 metres in 1997; theUrsa TLP in 1,160 metres in 1999; and fnally the Brutus TLP in910 metres o water in 2001.

The Brutus TLPs claim to ame is that it was the frst purposelydesigned as a feld hub, though various platorms were

previously retroftted or this role. More signifcantly, the BrutusTLP was completed seven months aster and 18% more cheaplythan Ram Powell, the TLP beore. When compared with theAuger TLP, the cost was down by 60% and the construction timewas hal.

This is a striking example o the economic benefts o the designone build many standardisation concept. However, it can onlyhappen in established and stable organisations such as Shell,where eorts are made to develop and retain peoples skills andthe process o identiying and applying best practices is deeplyingrained.

ten years later, a new tlpTen years ater the Brutus TLP, Shell has a new Gul o MexicoTLP on the drawing board. The Olympus TLP will orm the hearto the Mars B feld development project, the frst seriousdeepwater brownfeld project in the Gul o Mexico. This willincrease recovery rom the Mars basin and tap into the West

Boreas and South Deimos felds recently discovered nearby.The new TLP, at peak, will process approximately 100,000barrels o oil equivalent per day, which puts it in the same classas the earlier fve.

By exploiting the vast TLP operating experience within Shell, theMars B project team aims to provide a model o HSE excellenceor uture deepwater projects. The whole project is beingconducted within the ramework o a ull-cycle integritymanagement process. The latest hazard and eectsmanagement philosophy is being used to defne the optimumacilities layout, the best protection or personnel rom fre, blastand smoke or gas ingress, and the most ergonomic control roomdesign. The TLP, to highlight just one o its process equipmenteatures, will have riser isolation valves to minimise the impacto any serious incident. A similar approach to this is being takento modifcations on the West Delta 143C platorm, to which theMars B production will be transerred by pipeline.

avoiDing the neeD For surFace Facilit iesIn 1997, Shell claimed the record or the worlds deepestsubsea production development and the worlds longest subseatieback, when it developed the Gul o Mexico Mensa gas feld.Mensa feld had three wells initially and now has our that eed

riser technology anD the problemoF vorticesShell has been at the oreront o deepwater risertechnology since the 1970s and can claim a series oindustry frsts in this area. The risers are critical elementso any deepwater development and particularly proneto vortex-induced vibration (VIV), which can reducetheir atigue lie very quickly. Research at Shell aims toimprove understanding o riser responses to VIV,ormulate more eective riser monitoring measures anddevelop hardware solutions, such as strakes andairings, to minimise the eects o VIV.

Shell has a new Gul o Mexico TLP on the drawing board the Olympus TLP. This TLP will orm the heart o

the Mars B feld development project, the frst serious deepwater brownfeld project in the Gul o Mexico


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improveD oil recovery at ursa FielDThe production lives o the deepwater Ursa ield andthe nearby Princess ield, which is tied back to Ursa,have been extended by an expected 10 years byretroitting waterlooding acilities on the Ursa TLP.The Ursa-Princess waterlood project was one othe largest projects ever carried out on an existingplatorm in the Gul o Mexico and involved highlevels o construction, maintenance, commissioningand well service work, all undertaken simultaneously.A key challenge or the project team was itting thenecessary water treatment acilities into the limitedspace on the TLP. The irst injection o treated seawaterwas in July 2008; the volume enhancement capacityo the scheme is 30,000 barrels o oil equivalentper day.

enhanceD oil r ecovery in DeepwaterLowering the salinity and controlling the ioniccomposition o the injection water can improvewaterlooding eiciency. With this mind, Shell hasdeveloped low-salinity waterlooding. The waterproduced by low-salinity waterlooding can be usedor straight waterlooding or to enhance a range ochemical enhanced oil recovery techniques. Itspotential to help take enhanced oil recovery oshoreand into deep water is very real. As such, it is asigniicant component o Shells deepwater technologyprogramme.

into a maniold connected via a 12-inch pipeline to the WestDelta 143C platorm just over 100 kilometres away.

A ew years later, the Ormen Lange project in Norway, a jointdevelopment by Shell and Statoil eclipsed the achievements othe Mensa team. Considered the countrys frst genuinedeepwater development, Ormen Lange lies o the Norwegiancoast in waters ranging rom 850 to 1,100 metres. Thedevelopment is relatively unusual in being completely subseaand connected directly to the shore 120 kilometres away.Production rom 19 wells (each 9 5/8 inches in diameter) in ourclusters is transported through two 30-inch pipelines to anonshore processing centre where the gas and condensate is

separated and treated. The gas is then sent to the UK via thepurpose-built Langeled pipeline. At 1,200 kilometres in length,this is one o the worlds longest subsea pipelines.

The challenges acing the Ormen Lange partners were daunting.The natural environment is harsh, even by North Sea standards.There are sub-zero temperatures or large parts o the year,stormy seas, exceptionally strong underwater currents and asteep, uneven seabed close to a giant back wall ormed bya submarine landslide thousands o years ago.

The seabed is extremely cold and this, combined with the highpressure in the owlines, raised concerns about hydrateormation. Consequently, the two owlines are constantl y dosedwith inhibitor, which is cycled between the shore acilities andthe subsea production maniolds.

Ormen Lange feld came on stream in the second hal o 2007,three years ater the feld development plan was approved andonly two years ater drilling began. It was six months ahead oschedule and within budget. It reached plateau production in2009 and now delivers 20% o the UKs total gas demand.

URSA Princess, Gul o Mexico, USA


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FielD host unlocks DisperseDFielD economicsThe Na Kika development in the Gul o Mexico (on streamsince 2003) is notable or being the frst deepwaterdevelopment to use a central processing acility, asemisubmersible platorm, to host production rom several small,widely dispersed felds: Kepler, Ariel, Fourier, Herschel, EastAnstey and Coulomb, which lie in water depths between 1,770and 2,300 metres. Crucially, none o these felds waseconomically viable on its own.

Several technologies that emerged at the time, including smartwells and real-time multiphase owmeters, enable the ullproduction rom the various felds to be isolated or commingledunder remote control rom the Na Kika host platorm.

Na Kika mooring, Gul o Mexico, USA

Bonga Floating Production Storage and Ooading vessel, Nigeria


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pipeline technology FirstsOur pipeline project record speaks volumes or ourcommitment to technology in this area.We pioneered the J-lay technique in the late 1960sand developed the articulated stinger orcontinuous pipelaying at about the same time.We were behind the introduction o lexiblelowlines in the 1970s. During the 1990s, weperormed the irst deepwater J-lay project (Augerield), installed the irst helically wound, super-duplex steel umbilical (Popeye ield) andestablished a water depth record or S-laying a

pipeline (Mensa ield). The year 1999 saw the irstdeepwater buried pipeline (Angus ield), and a

year later we set the depth record or a pipe-in -pipelowline (Europa ield). In 2003, we set the depthrecord or a subsea lowline (Coulomb ield, 2,316metres), and a couple o years later we perormeda record-depth burial operation to improve thislowlines heat retention properties.

Coming right up to date, connecting the Perdidooil export pipeline to the Hoover oshore oilpipeline system involved us in one o the mostambitious hot taps ever attempted. The Perdidopipeline was connected into the live system in1,370 metres o water during a 17-day windowin 2010. The operation took more than two yearsto plan, work that involved 3D modelling, remotelyoperated vehicle simulation and precise metrology.Key to the exercise was the design o an unusualsemi-buoyant truss structure that orms theoundation or the pipeline tee.

milestones in Floating proDuction,storage anD oFFloaDing (Fpso) FacilityDevelopmentShell has been at the oreront o FPSO acility technology sinceits earliest days. We installed the industr ys frst such vessel inCastellon feld o the coast o Spain in 1977 and we haveplayed a major role in taking this technology into deep watersince then.

The Bonga FPSO acility, in more than 1,000 metres o watero the coast o Nigeria, stands out or several reasons, not leastbecause it was Nigerias frst deepwater project. The vessel,which came on stream in 2005, set the benchmark or the

industry. At the time, it was one o the largest FPSO acilitiesin the world, having the capacity to store 2 million barrels o oil.It was also the frst vessel to utilise Inconel-clad steel catenaryrisers.

We made great eorts to maximise the local content o theBonga project. Various processing modules and oundationequipment were designed and constructed in Nigeria, andthere was a signifcant investment in training and developinglocal operations and production engineers. Consequently, 90%o Bonga felds workorce is now Nigerian.

Bonga feld has 16 subsea wells: a mixture o producers andwater injectors. We plan urther drilling to develop reser ves onthe northwest ringe o the feld, which we uncovered with ourfrst 4D seismic surveys in Nigeria in 2008 and again in 2010.

Final assembly o oshore pipeline construction system, Perdido, USA


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Espirito Santo, Parque das Conchas, Brazil

The Parque das Conchas

and Perdido projects

demonstrate our constant

innovation to ensure the

success o deepwater

ventures and changethe game


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25

Espirito Santo, Parque das Conchas,Brazil

D d d f d-

s

d .

Despite the progress made, deepwater development still hasthe power to set pulses racing. Two recent projects, Parquedas Conchas, oshore Brazil, and Perdido in the Gul o Mexicodemonstrate the requirement or constant innovation to ensure

the success o deepwater ventures.

parque Das conchasIn July 2009, Shell began production rom t he multi-feld Parquedas Conchas development in the Campos basin, 110 kilometreso the south-east coast o Brazil in approximately 1,800 metreso water.

Oil and gas rom three felds, Abalone, Ostra and ArgonautaB-West, are pumped through risers to the Espirito Santo FPSOacility. There are ew such acilities deployed in waters thisdeep and not many that are much bigger. The giant double-sided vessel is 330 metres long and can process up to100,000 barrels o oil and 50 million standard cubic eet ogas per day and store up to 1.5 million barrels o oil.

O the numerous technical innovations or advances associatedwith this project, too many to list here, our stand out asinstrumental in ensuring its economic viability. The frst concernsthe drilling o the wells. Using a high-pressure drilling riser

enabled Shell to go with a cost-eective, third-generation rig todrill and complete the nine production wells and one gasinjector in the three felds. It was the frst time this had beendone. The Transocean Arctic is normally rated or drilling inwaters no deeper than 945 metres; with a surace BOP, thisrating was extended to 2,250 metres.The second is that Parque das Conchas is the frst ull-felddevelopment in which the oil and gas are separated at theseabed and the oil is pumped to the surace. This is essential tothe development, as there is insufcient energy in the reservoirsto lit the heavy oil (1620 API) almost 2 kilometres to the FPSOacility. The power requirement is huge: the FPSO acility boasts

Espirito Santo, Parque das Conchas feld, Brazil

State-o-the-art projects


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STATE-OF-THE-ART PROjECTS

a 68-megawatt power plant to drive the subsea separationsystems and the six 1,500-horsepower, high-pressure pumps thatsit in specially designed artifcial-lit modules on the seabed.The third, a consequence o the power needed at the seabed, isthat the dynamic umbilicals linking the FPSO acility to the

seabed acilities (total length 30 kilometres) are also highlyunusual. They incorporate multiple high-voltage powertransmission lines, steel tubes to convey hydraulic power andchemicals, and low-voltage electrical cables or control purposesand data transmission.

The ourth is that reducing the weight o the risers was critical insuch deep water. Hence, the development uses buoyant steelrisers that take on a lazy-wave orm between the seabed andthe vessel. This decouples the risers rom the motion o the FPSOacility and preserves their atigue lie. This was the frst use osuch technology on a turreted FPSO acility.

Phase 2 o the Parque das Conchas development, in which theArgonauta O-North feld will be developed using sevenproduction and our injection wells, is under way. This secondphase at peak will likely deliver an additional 35,000 barrels ooil per day in addition to the volume rom the frst phase o theproject.

perDiDoShell acquired the leases or the Perdido felds in the Gul oMexico in 1996. Water depths in the area range rom 2,300to nearly 3,000 metres. To add to the challenges, the seabedcovers a part o the Perdido old belt, which resembles a smallerversion o the Grand Canyon and has near-vertical clis up to300 metres tall. It is worth noting that when Shell took on thePerdido acreage, the industry was developing felds in waterdepths o about 1,000 metres maximum and the technologywas at ull stretch.

Ultimately, Shell discovered three felds in the area: Silvertip,Great White and Tobago, which together were judged to orma potentially economic development, as long as the righttechnology solution could be assembled.

Some o the Perdido reservoirs hold relatively heavy oil (1720API) and have low reservoir pressures. Some hold light oil.A wide variety o target zones means that the Perdidodevelopment needs many wells. There are 35 in the

Perdido spar, Gul o Mexico, USA

Perdido is a genuine game changer. When Shell took on the Perdido acreage, the industry was developing

felds in water depths o about 1,000 metres maximum and the technology was at ull stretch. Now, the

Perdido acility is moored in 2,450 metres o water.


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27

development plan: 22 o them clustered together. This wouldhave been a massive, prohibitively costly host platorm usingconventional design concepts.

The solution was to use a buoyant spar, an established,lighter-weight, ultra-deepwater platorm, in combination withdirect-vertical-access wells ftted with subsea (wet) trees. Thisnecessitated a high-pressure drilling and completion riser witha surace BOP. Also key to the whole concept was subseaseparation and boosting, which is very similar to the systemused frst at Parque das Conchas. The produced uids rom thesubsea wells are commingled on the seaoor and directed intoan artifcial lit module consisting o fve identical separation andelectric submersible pumping units. The net eect o all o thistechnology reduces the size and weight o the well bay, andso the platorm topsides, which means the whole system canbe supported on a reasonably sized spar.

The integration o these technology elements in such deepwater represents one o the most remarkable achievements inthe industrys history. It is an achievement that would havebeen impossible without the exemplary commitment,imagination, co-operation and openness displayed by Shell,its venture partners Chevron and BP, and some o the oilfeldservice sectors leading lights. What is particularly signifcantabout the Perdido development is that it points the way or thedevelopment o smaller oil and gas reser ves in ultra-deepwaterall around the world it is a genuine game changer.

subsea processing working at thenext FrontierSubsea processing arguably represents one o the oil

industrys last major rontiers. It is an area o hugepotential rewards and considerable technicalchallenges. Shell has been active in the area or many

years and can take credit or worlds frst use o subseamultiphase pumping; this was in the Draugen feld,Norway, in 1993.

The Parque das Conchas and Perdido developmentswere wholly reliant on subsea processing: thereservoirs in both cases have insufcient naturalpressure to orce the hydrocarbons to the surace andso require artifcial lit. Shell engineers came up withthe idea o caisson-contained electrical submersible

pumps or Parque das Conchas: the frst time this wastried in a continuous production environment. Parquedas Conchas then replicated the design or Perdido.

Key to the development o the systems was theinvolvement o Shell scientists and engineers roma range o disciplines. Well, process, subsea acilitiesand power engineers, riser technologists and owassurance specialists worked together and with leadingequipment manuacturers to design systems that haveperormed remarkably well on these two iconicdeepwater projects.

Research and technology development in this area isnow targeting improved caisson designs and electricalsubmersible pump reliability; the qualifcation odownhole and seabed systems or high-pressure,high-temperature applications; undamentalunderstanding o new ow assurance phenomena; andmeasures to cope with the high salinity and scale levelscommonly associated with subsalt reservoirs.

Cross section o typical umbilical

Installation o enhanced vertical deepwater tree, Perdido


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We have reached the

stage where water depth,per se, no longer represents

quite the technical barrier

it once did

Bonga Floating Production Storage and Ooading vessel, Nigeria


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29

3D visualisation, New Orleans, USA

Subsea compression pilot unit, Ormen Lange, Norway

t d d, d

. a

, d

d d

. a f

d f

f d.

It is tempting to think that ater so many years o deepwater oiland gas development, the challenges might have diminished.However, this is not the case.

We have reached the stage where water depth, per se,no longer represents quite the technical barrier it once did.However, increased saety and environmental challenges havecome along with more complex reser voirs and uid streams,more remote and smaller felds, and constant economic

pressure. In combination, this makes lie as challenging asever or deepwater developers.

technology anD innovationcommitmentAdvances in a wide range o technologies will be necessaryin the uture to maintain the pace o progress. There never has

Looking to the uture

been a single silver-bullet solution as ar as deepwaterdevelopment is concerned. For this reason, Shell remainscommitted to world-class research and development programmesin a variety o key areas.

We are looking to build additional capabilities in subseaprocessing: separation, compression, boosting and, urtherdown the line, water injection. Flow assurance is a constantocus: our attention covers all the produced uids rom thereservoir to the point o export. Well design, containmentsystems and downhole sensor technology are high on ouragenda or saety and production optimisation reasons.


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LOOKING TO THE FUTURE

Driving costs out o the acilities design and construction processis an important aim, so we are looking at lightweight materialsand structures, greater standardisation, process automation andwater management, a particularly key issue.

Over the years, we have made tremendous advances inimproved and enhanced oil recovery technology, and wehave several processes and techniques that we will seek totake oshore in the years ahead.

technology Flow into newexciting areasIt is generally believed that, regardless o the area in which you

work, the best solutions are developed at times o greatest need.The technology solutions devised as we have moved intoever-deeper water bear this out. Deepwater has stimulatedadvances in oilfeld technology rarely seen during any otherperiod in the industr ys history.

We now need to look at what we have gained in deep waterand leverage this at other industry rontiers: oating liquefednatural gas technology is a particularly pertinent example asar as Shell is concerned. Much o what we have learned indeepwater will be immensely valuable during the nex t ew yearsas we develop Prelude gas feld o Australias northwest coastusing what is currently the biggest oating hydrocarbon

processing acility ever built.

stanDarDisation anD leveragingglobalisation

Having stressed the individual nature o deepwater projects,there are elements o these overall ventures that bearstandardisation. There are elements we can replicate to reduce

costs, accelerate project timescales and improve reliability.Not everything needs to be a one-o. We have shown this withthe development o deepwater felds in the Gul o Mexico usingvery similar TLPs. Our work to standardise tree designs is anothergood example, as is the recent development o the Parque dasConchas felds in Brazil and the Perdido complex in the Gul oMexico with almost the same subsea processing systems.

Standardisation will become even more important as thedeepwater industry becomes more global. Transer o the latesttechnology, development concepts and equipment designs in

parallel with the application o best practices in projectmanagement, contracting, procurement and project executionwill speed up deepwater projects in new provinces and helpto raise their local content quickly.

helping Develop peoples skillsProjects like Gumusut-Kakap in Malaysia are valuable in manyways. They enable Shell to expand its deepwater portolio.At the same time they help people to develop their deepwaterproject execution skills, and countries the ir deepwater capabilityand global competitiveness. In addition, these new projects willstimulate the ormation o new supply chains which is a keyocus area or the deepwater industry as more players enter theray. Owing to high demand or key items o specialist subseaequipment, existing supply chains are coming under strain. Thismay ultimately impede the much needed high-pace o felddevelopment.

A stimulating and challenging working environment, plus thechance to work on projects o a remarkably diverse nature,have enabled Shell to build and retain a core o people withoutstanding deepwater knowledge, experience and ability.To ensure continuous renewal at a time when the re is so muchcompetition or young talented people, Shell is partnering withuniversities and investing in programmes to help its senior stabecome better teachers to understand dierent learningprocesses, to communicate more eectively in various culturalsettings and to coach and mentor young people on anindividual basis.

We are working hard to attract the best and brightest people

to join Shell Deepwater Project Centres around the world inthe USA, Nigeria, Malaysia and Norway.

Developing talent worldwide is perhaps the biggest challengewe ace i we are t o continue to overcome the technology,project execution and saety challenges deepwaterdevelopments will inevitably present.

leaDing the wayThe Deepwater Horizon disaster in the Gul oMexico in 2010 orced the industry to think againabout saety. As well as developing technologymeasures to reduce the chances o such an incidentrecurring, we need to look at the structuralrelationships within the industry, to create evengreater partnership and alignment between theield development community and the servicesector. Strong leadership is required rom all sides;at Shell, we are determined to show the way.


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gumusut-kakap points the way For Deepwater globalisationThe Gumusut-Kakap project oshore Malaysia is a great example o how deepwaterexpertise developed in the Atlantic basin, and especially the Gul o Mexico, isdelivering value around the world. The Gumusut and Kakap ields were combinedinto a single development: Shell and ConocoPhillips Sabah Ltd each hold 33%interest in the development, PETRONAS Carigali has 20% and Murphy 14%. Shellis the PETRONAS-appointed operator o the Gumusut-Kakap development.

The Gumusut-Kakap development oshore Sabah is Shells irst deepwater projectin Malaysia. It will have 19 subsea wells linked to a semi-submersible FloatingProduction System (s-FPS) moored in 1,200 m o water. The oil will be exported

by pipeline some 200 km to shore in Kimanis, Sabah. The associated producedgas rom the ield will be reinjected to improve oil production.

Shell Smart Fields technology will optimise production at Gumusut-Kakap. SmartFields technologies integrate digital inormation or real-time decision making byan integrated well and reservoir management team, and help to develop acomprehensive understanding o the entire production system rom reservoir to

sales point. This leads to a high standard in day-to-day production system surveillanceand optimisation, and accurately targeted uture development options. It keeps thesystem availability in the top quartile and ensures top quartile cost. An importantenabler or this is the Smart Fields technology exception based surveillance,whereby thousands o real-time data eeds are computer-monitored, and productionsystem issues are lagged beore they arise.

The Malaysian content o the project is high. The 40,000-tonnes FPS is owned byMalaysia International Shipping Corporation (MISC) and is being built at theMalaysia Marine and Heavy Engineering (MMHE) abrication yard in Pasir Gudang,

Joho r. MISC will lea se the s-FPS to Shell and it co-venturers.

The project is being led rom Shells deepwater major projects oice in Kuala Lumpur,which is also serving as a training centre or Shells Malaysian engineering sta.Malaysian contractors are also providing hundreds o local graduate engineers tothe project, all o whom are accumulating valuable irst-hand experience.

To maintain the pace o progress, advances in a wide range o technologies will be needed in the uture


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