Shell invests in PowerNap subsea tie-back in Gulf of Mexico

LONDON - Shell Offshore has elected to invest in its PowerNap deep-water project in the U.S. Gulf of Mexico, a subsea tie-back to the Shell-operated Olympus production hub. The project is expected to start production in late 2021 and produce up to 35,000 boed at peak rates. It is anticipated to have a forward-looking break-even price of less than $35/bbl and is currently estimated to contain more than 85 MMboe recoverable resources.

Shell discovered PowerNap in 2014. 100% developed by Shell, it is located in the south-central Mississippi Canyon area approximately 150 miles from New Orleans in about 4,200 ft of water. The Shell-operated (71.5%) Olympus production hub is co-owned by BP Exploration and Production Inc. (28.5%). Production at Olympus began in 2014. PowerNap production will be transported to market on the Mars pipeline, which is operated by Shell Pipeline Company LP and co-owned by Shell Midstream Partners, L.P. (71.5%) and BP Midstream Partners LP (28.5%).

"PowerNap further strengthens Shell’s leading position in the Gulf of Mexico,” said Wael Sawan, Shell’s upstream director. “It demonstrates the depth of our portfolio of deepwater growth options, and our ability to fully leverage our existing infrastructure to unlock value,” he added.

Shell has a leading deep-water portfolio with an exciting development funnel and strong exploration acreage in the US Gulf of Mexico, Brazil, Nigeria and Malaysia heartlands, as well as in emerging offshore basins such as Mexico, Mauritania and the Western Black Sea. Shell currently is the largest leaseholder and one of the leading offshore producers of oil and natural gas in the US Gulf of Mexico.