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Shell's FID on Pierce Field Brings North Sea Back Into Focus

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Royal Dutch Shell plc. has taken a final investment decision (FID) with Ithaca Energy to upgrade the Pierce oil field located nearly 165 miles east of Aberdeen in Blocks 23/22a and 23/27 of North Sea’s UK Continental Shelf sector. This strategic move will lead to production of natural gas.

The project will be responsible for drilling new wells and modifying the existing floating production, storage and offloading (FPSO) platform. Moreover, it will install a new subsea gas export line from the FPSO to the SEGAL pipeline and enable Shell to send gas to St Fergus in Scotland, one of UK's foremost gas terminals.

The Pierce field, which came online in 1999, has produced 11,000 barrels of oil equivalent per day (bp/d) and 80 million cubic feet per day (MMcf/d) of natural gas in the first two quarters of 2019. However, with this project, the oil and gas producing field is estimated to churn out nearly 30,000 bp/d during peak production phase. Shell has a 92.52% operated interest in the field with Ithaca Energy accounting for the remainder.

Courtesy of this Pierce development project, the Netherlands-based company will be able to enhance its shareholder value by opening up supplemental gas reserves for households and industries in the UK.

Shell will take services from Luxembourg-registered Subsea 7 (SUBCY - Free Report) , which is ordered to supply and set up an 18.6-mile long gas export pipeline, a riser and other pieces of kit for the Pierce project.

Other operations on this project are already in progress at Subsea 7’s office in Westhill near Aberdeen. While the offshore development activity is expected between 2020 and 2021. This is Shell’s eighth FID with Pierce in Britain’s continental shelf since the beginning of 2018.

Royal Dutch Shell is involved in all phases of the petroleum industry from exploration to final processing and delivery.

Prior to the Pierce oil field, Shell together with Exxon Mobil Corporation (XOM - Free Report) and BP plc (BP - Free Report) made its seventh FID on the Shearwater gas hub in the U.K. North Sea.

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