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Unlocking energy from deep water
First oil has been produced from the SNEPCo-operated Bonga North West deep-water project in Nigeria. This is a significant step forward for the Bonga project, Nigeria’s first deep-water development in water depths over 1,000 metres, which began producing oil and gas in 2005.
Bonga North West follows the Olympus platform, which started production from the new Mars B development in the Gulf of Mexico earlier in 2014. Mars B is the first deep-water project in the Gulf to expand an existing oil and natural gas field with new infrastructure.
Heavier than more than 300 Boeing 747 jumbo jets and 124 metres (406 feet) tall, Olympus is tethered with immensely strong mooring lines stretching thousands of metres down to the seabed. Combined future production from Olympus and the original Mars platform has the potential to reach an estimated 1 billion barrels of oil equivalent (boe).
Both Bonga North West and Mars B boost Shell’s contribution to meeting growing energy demand from an array of major deep-water projects. Operating at extreme depths around the world requires advanced technologies, high safety standards and a responsible approach.
Tapping into reservoirs up to 6.5 km (four miles) below the sea’s surface requires human ingenuity and advanced technical expertise. In the waters, fish, crab and coral thrive. Onshore, communities rely on the ocean for their livelihood. Bonga North West and Olympus makes use of existing infrastructure, limiting impact on the marine environment.
Engineers designed the Olympus platform to withstand the most violent storms that hit the Gulf, bringing high seas and hurricanes. And the project’s advanced technologies must operate reliably under extreme water pressure and in icy conditions far below the ocean’s surface.
Such challenges are not unique to these developments. All deep-water projects across the world demand significant investment, major feats of engineering and detailed steps to protect people and the environment. So why are energy companies like Shell continuing to go deeper and deeper?
Shell deep-water projects
Over 300 billion barrels of recoverable oil lie beneath deep water, according to the International Energy Agency (IEA). That’s at least 10% of the world’s remaining recoverable conventional oil and gas resources. They will be a vital part of the energy mix as global demand rises.
Deep-water oil and gas already account for around 6% of the world’s energy mix. The IEA predicts an expansion from 4.8 million boe a day in 2011 to about 8.7 million boe by 2035. This will help balance the future decline in production in shallower waters, mainly in the North Sea and parts of the Gulf of Mexico.
A global approach
We employ teams of experts and operate worldwide facilities to design and develop deep-water projects, and we also partner with others. Our deep-water activities extend from the Gulf of Mexico to the China Sea, from the Norwegian continental shelf to the waters off Nigeria’s coast. Shell has decades of experience in developing and operating deep-water projects . We produced around 330,000 boe every day from our deep-water projects in 2012, or 10% of our total global production.
At existing fields, we are finding ways to increase production and extend the lifespan of fields. The Mars B project’s Olympus platform is expected to produce 100,000 barrels of oil equivalent a day at its peak and will extend production at the Mars Field until 2050 or beyond. We have also upgraded facilities at the Draugen field off the coast of Norway to extend production well beyond its original 20-year lifespan.
We have seven deep-water projects under construction, some in new frontiers. Advanced exploration, seismic and modelling developments have allowed us to make fresh discoveries. This includes a technique that creates a wide angle between seismic sound wave transmitters and receivers to better see beneath thick layers of salt that can mask oil and gas reservoirs. Thanks in part to this approach we have made five major discoveries in the Gulf of Mexico, adding hundreds of millions barrels of oil and gas to the region’s resources.
The Olympus platform started production in the Gulf of Mexico in February 2014
The extreme locations of our projects pose unique challenges. In some of the world’s roughest seas off the coast of Norway, for example, a massive landslide over 8,200 years ago created a dramatically uneven seabed, with craters and craggy hills. Engineers had to level the seabed before safely laying down equipment. They created a vast rock foundation – the latest installation to house more production wells required a foundation that could fill 200 Olympic swimming pools.
In contrast, the soft sand in the Campos Basin, Brazil, makes drilling for oil and gas at Parque das Conchas project like digging a hole in the beach – posing its own technical challenges.
Oil and gas reservoirs at our Perdido project in the Gulf of Mexico are scattered. We placed a platform on top of a giant floating steel cylinder, called a spar. It uses a system of mooring lines that can be pulled in or let out to reposition the spar over drilling locations on the seabed, allowing it to tap into the pockets of oil and gas.
At all our operations, including those far below the ocean’s surface, safety is always our top priority. The BP Deepwater Horizon tragedy in 2010 showed the potentially devastating impact if things go wrong. Following this incident, we joined a consortium with eight other leading companies to improve drilling safety and minimise environmental impact in the event of a serious incident. Work has included building a global response system able to cap a well at depths of up to 3,000 metres (over 9,800 feet).
We also joined with other companies that operate in the US Gulf of Mexico to form the Marine Well Containment Company. It set up a rapid-response system that is designed to cap and shut in a well, or capture,contain and flow leaking oil safely to storage in the event of any future underwater well blowout.
All wells at Shell operations must meet rigorous design and construction standards. We use advanced sensors to monitor deep-water wells in real time. This allows engineers based in onshore operations centres to identify any potential risks and respond immediately.
Our advanced technical approach to the safety of wells is combined with extensive training of all our engineers who work on wells. They must qualifythrough an externally, globally recognised three-year training programme before they can work unsupervised as a well or completion engineer or rig-site supervisor.
Workers stand on board the Bonga floating production, storage and offloading platform
Developing deep-water energy resources helps boost national economies.. The Campos Basin, site of our Parque das Conchas project, provides 85% of Brazil’s oil production. We are working with local people to help them better understand our activities and the potential benefits the revenue generated can bring.
We also invest directly in local communities. This includes programmes to help boost skills, such as an initiative in Brazil to help small businesses become suppliers to the oil and gas industry.
In Nigeria, at the Bonga deep-water project, a giant floating, production, storage and offloading vessel moored in over a kilometre of water receives crude from production wells on the seabed. The Shell Nigeria Exploration and Production Company Limited (SNEPCo) manages the project and has worked to help locals develop job skills – including to work on the project – as well as supporting local businesses.
In Malaysia, our Gumusut-Kakap project is supporting the government’s efforts to develop the economy. The facility was built in a shipyard in Johor while the project is led from Shell’s offices in Kuala Lumpur.
Respect for nature
Maintaining the balance of the marine environment in deep water is vital for the health of the planet. In partnership with environmental experts, we work to reduce the impact of our operations. Our rigorous approach includes a systematic assessment of the potential impacts of any activities on people and the environment.
We plan from the earliest stages to minimise any impacts. At our Gumusut-Kakap project, for example, we are injecting the gas produced with the oil back into the reservoir to boost oil production. This helps reduce flaring to burn off waste gas.
We also fund projects to help protect marine life in areas close to our operations. Our initiatives include support for the first dolphin conservation programme in Malaysia. Off the coast of Brazil we are working with the Scientific Institute Aqualie, a Brazilian non-profit organisation, to learn more about the behaviour of whales.
The Mars B project in the Gulf of Mexico is investing $5 million in community and environmental initiatives, partnering with US Gulf Coast groups that include The Nature Conservancy, Barataria-Terrebonne National Estuary Program and LA-1 Coalition.