SEPCo outlines Na Kika project, reveals Princess discovery

Shell Exploration & Production Co. (SEPCo) Wednesday outlined a $1.26 billion plan to develop the Na Kika deepwater project with the Gulf of Mexico�s first floating production/storage vessel. Project approval by Shell�s 50:50 partner, BP, is pending. Shell said the fields included in the Na Kika project and a newly discovered field, Princess, had combined reserves of more than 500 million bbl. Both are in the Mississippi Canyon area off Louisiana.


Shell Exploration & Production Co. (SEPCo) Wednesday outlined a $1.26 billion plan to develop the Na Kika deepwater project with the Gulf of Mexico�s first floating production/storage vessel. Project approval by Shell�s 50:50 partner, BP, is pending. Shell said the fields included in the Na Kika project and a newly discovered field, Princess, had combined reserves of more than 500 million bbl. Both are in the Mississippi Canyon area off Louisiana.

The Na Kika development would consist of six subsea production systems serving satellite fields tied back to a centrally located floating production facility. The six fields are located in 5,800-7,600 ft of water. The project is expected to recover more than 300 million boe.

The semisubmersible host facility will be permanently moored�via a 16-leg catenary mooring system comprised of chain, wire rope, and suction piles�about 140 miles southeast of New Orleans. Oil and gas production will be transported to shore via export pipelines.

Na Kika will produce from BP-SEPCo-owned fields Ariel, East Anstey, Fourier, Herschel, and Kepler to begin with, and Coulomb (owned 100% by SEPCo) will be tied-in later. Kepler is on Mississippi Canyon (MC) 383; Ariel, on MC 429; East Anstey, MC 607; Herschel, MC 520 and 522; Fourier, MC 522; and Coulomb, MC 657.

The partners will produce from two wells on Kepler, three on Ariel, one on East Anstey, one on Herschel, three on Fourier, and either one or two on Coulomb. Kepler produces mostly oil, as do Ariel and Herschel; East Anstey produces mostly gas; Fourier produces oil and gas; and Coulomb is mostly gas. The oil will flow to the host facility through pipe-in-pipe insulated flowlines, and the gas will flow through uninsulated flowlines.

Production will be processed at the host vessel�which will have separation, dehydration, and treatment facilities capable of handling 325 MMcfd of gas and 100,000 b/d of oil�and then transported to shore via an 18-in. oil pipeline and a 20-in. gas pipeline.

Contractors for the system component fabrication, integration, and installation will be announced during the first quarter of 2001.

Drilling work will begin with the Kepler area in 2001. Installation of the subsea equipment is expected to begin in the second quarter 2002; production is scheduled to begin in mid-2003. Production from Coulomb is anticipated by 2005.

Peak production rates are expected to reach 325 MMcfd of gas and 100,000 b/d of oil.

Shell will be the preproduction operator and be responsible for the design, fabrication, and installation of the production host facilities and subsea systems, as well as the drilling and completion of the 10 development wells. BP will serve as the postproduction operator, responsible for the operation of the host facilities and surveillance of the satellite fields.

SEPCo said it is using numerous new technologies in the this project, including advanced slug control (gas lift, surface slug suppression device, automated process controls, dynamic modeling), coiled tubing gas lift for startup and production enhancement, and advanced produced water treatment.

It also said it will be using the first pipe-in-pipe risers in the world, the first gas lift risers in the gulf, the first lazy wave risers, and the first electrically heated-ready flowlines and risers. Plus, it said, this will be the first deepwater subsea well completion with three commingled reservoirs.

Half the costs of the project come from the fabrication and installation of the host facility and pipeline, a quarter of the costs are associated with the fabrication and installation of the subsea components, and the rest are associated with the drilling and completion of the wells, said SEPCo.

Na Kika is the octopus god of the Kiribati people of the Gilbert Islands, said the company, who shoved up the earth from the bottom of the sea to form the islands, the beaches, and the rocks.

Princess
The Princess discovery is on Mississippi Canyon 765 in 3,600 ft of water. Four wells on the prospect have found 300 net ft of pay in several zones, said SEPCo, which added the reservoir thickness and quality of sands are similar to the productive sands at its Ursa field. At Ursa, production levels have reached 100,000 b/d of oil and 140 MMcfd from four wells.

"Princess is a significant addition to Shell's growing deepwater inventory," said van de Vijver. "Common ownership of the neighboring infrastructure at Shell's Ursa field just three miles south of Princess allows us to consider some very cost-effective development options for this discovery. Shell and its partners are currently considering additional appraisal options as well as evaluating those various development scenarios."

SEPCo operates Princess with 45% interest; BP holds 23% interest; and Conoco Inc. and ExxonMobil Corp. each hold a 16% working interest.

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