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Shell to Make 'Sizable' Deepwater Investment

A U.S. subsidiary of Royal Dutch Shell plc on Wednesday sanctioned the Cardamom oil and natural gas field in the Gulf of Mexico (GOM), a deepwater prospect that is expected to produce 50,000 boe/d at peak production and more than 140 million boe over its lifetime.

Cardamom, scheduled to begin full operations in 2014, is in Garden Banks Block 427, about 225 miles (362 kilometers) southwest of New Orleans. Shell is 100% leaseholder. Shell Offshore Inc. got the green light for Cardamom's exploration plan in March after the deepwater drilling moratorium in the GOM was lifted; drilling ramped up within days (see Daily GPI, April 29; March 22).

"Technological advances in seismic imaging and drilling have allowed us to both discover and access this new field," said Shell Upstream Americas Director Marvin Odum. "This is another sizeable deepwater investment by Shell that strengthens energy supplies to the U.S.A. It will also secure employment for more offshore workers."

No financial details were disclosed.

Cardamom's potential was recognized early by Shell as it developed the Auger tension-leg platform in 1994 in Garden Banks Block 426. However, the reservoir could not be fully assessed because of a layer of salt nearby, which affected the quality of traditional seismic images.

The discovery was confirmed last year after Shell drilled a well from the Auger platform, which broke records for length and depth -- the exploration wells were drilled more than four miles (6.4 kilometers) below the seabed. The Cardamom discovery well was 31,634 feet deep (9,642 meters), at a reach of 15,000 feet-plus (4,570 meters) and a vertical depth of more than 25,000 feet (7,620 meters). The initial well has been producing directly from the Auger platform since last December.

Last year Shell began front-end engineering and field design to bring Cardamom onstream. With its sanctioning, development drilling and undersea equipment installation now will begin, Shell said.

Production from Cardamom would flow through the Auger platform, which would minimize the offshore footprint by using existing infrastructure. The completed subsea system is to include five well-expandable manifolds, a dual 20-centimeter (eight-inch) flowline and eight well umbilicals.

To accommodate the new field's output, the Auger platform is to be modified with additional subsea receiving equipment, a new production train and weight mitigation, which would increase liquid handling, cooling and production capabilities. Since it was initially developed Auger already has produced more than 300 million boe, Shell noted.

Developing Cardamom is the latest project to be sanctioned by Shell in the GOM deepwater. Perdido, which is considered the world's deepest offshore production project, restarted early this year (see Daily GPI, Jan. 4). Perdido had begun operations just weeks before the Macondo well blowout (see Daily GPI, April 5, 2010).

Also last year Shell sanctioned a second platform in the deepwater Mars B field in the GOM. A Mars platform was heavily damaged by hurricanes Gustav and Ike in 2008 (see Daily GPI, Oct. 2, 2008).

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