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Shell starts production on Kaikias a year early

Shell Offshore, a subsidiary of Royal Dutch Shell, announced the early start of production – around one year ahead of schedule – at the first phase of Kaikias, an economically resilient subsea development in the US Gulf of Mexico with estimated peak production of 40,000 bbl of oil equivalent per day (boed).

Shell has reduced costs by around 30% at this deepwater project since taking the investment decision in early 2017, lowering the forward-looking, break-even price to less than $30 per bbl of oil.

“We believe Kaikias is the most competitive subsea development in the Gulf of Mexico and a prime example of the deepwater opportunities we’re able to advance with our technical expertise and capital discipline,” Andy Brown, Upstream Director, Royal Dutch Shell, said. “In addition to accelerating production for Kaikias, we reduced costs with a simplified well design and the incorporation of existing subsea and processing equipment.”

Kaikias is located in the prolific Mars-Ursa basin approximately 130 miles (210 km) from the Louisiana coast and is owned by Shell (80% working interest) as operator and MOEX North America (20% working interest), a wholly owned subsidiary of Mitsui Oil Exploration Co.

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