Royal Dutch Shell Plc. (Shell) made a final investment decision on the redevelopment of the Penguins oil and gas field in the U.K. North Sea, the company announced on Monday.
According to Shell, the decision authorizes the construction of a floating production, storage and offloading (FPSO) vessel -- the first newly manned installation for the company in the northern North Sea in almost 30 years.
“The redevelopment is an attractive opportunity with a competitive go-forward break-even price below $40 per barrel. The FPSO is expected to have a peak production (100 percent) of circa 45,000 barrels of oil equivalent per day,” the statement read.
The Penguins field currently processes oil and gas using four existing drill centers tied back to the Brent Charlie platform.
The redevelopment of the field, required when Brent Charlie ceases production will see an additional eight wells drilled, which will be tied back to the new FPSO vessel. Natural gas will be exported through the tie-in of existing subsea facilities and additional pipeline infrastructure.
The Penguins field is in 165 meters of water, approximately 150 miles north east of the Shetland Islands. The field was first developed in 2002 and is a joint venture between owner and operator Shell with a 50 percent share and ExxonMobil, the other 50 percent stakeholder.
By Gulsen Cagatay