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Shell: Mars Deepwater Production to Resume in May

Shell Exploration & Production Co. expects initial production from its deepwater Mars platform to resume in late May, at least one month ahead of schedule after it was knocked out of commission last year during Hurricane Katrina. Mars, the largest platform damaged by the massive storm, represents about 5% of current Gulf of Mexico daily production. Pre-Katrina rates are expected to be restored by the end of June.

Shell's Mars and Ursa fields were close to the center of Katrina as it stormed through the Gulf. Mars is connected to the Mississippi Canyon pipeline, and it was producing 150-170 MMcf/d of natural gas and 150,000 bbl/d of oil prior to Katrina. The platform has a production capacity of 220,000 bbl/d of oil and 220 MMcf/d of gas. The Mars tension leg platform (TLP) and wells survived the extreme Katrina weather conditions, but the platform drilling rig and some major elements of the topsides production equipment were heavily damaged.

Marvin Odum, who heads Shell E&P in North and South America, credited the "tremendous work of the Shell team" in rebuilding the platform ahead of schedule. "The Mars platform recovery and deepwater pipeline repairs were among the most technologically complex operations in the world, and our people were up to the task, completing the work safely and ahead of schedule."

Many of the people who helped to restore Mars, said Odum, "were dealing with their own personal recovery, yet they never wavered in their commitment to help Shell restore its operations and increase our country's energy production."

Shell operates the platform and holds a 71.5% stake; BP plc holds the remaining stake. Shell said it has begun to notify midstream transportation, marketing and downstream customers to begin securing sales. Based on progress to date, Shell expects the construction activity necessary for initial production to be completed by the end of April. A brief recommissioning and start-up process will follow, with partial production resuming in May.

By the end of 2005, Shell had repaired all of its hurricane-damaged facilities except Cognac and Mars, which restored more than 75% of its total pre-Katrina production rate.

In restoring the Mars TLP and its pipelines, Shell accomplished what it called "unprecedented" repairs, including:

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