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Shell starts production at Perdido - world’s deepest offshore drilling and production facility

31/03/2010 Shell today produced its first oil and natural gas from the Perdido Development, the world's deepest offshore drilling and production facility. Located in an isolated, ultra-deep sector of the Gulf of Mexico, Perdido marks a new era in innovation and safely unlocks domestic sources of energy for US consumers. The facility sits in approximately 2,450 metres (8,000 feet) of water, which is roughly equivalent to six Empire State Buildings stacked one atop the other, and will access reservoirs deep beneath the ocean floor. Perdido smashes the world water depth record for an offshore platform by more than 50%.

"Perdido is an impressive project in a strong Gulf of Mexico portfolio that continues to grow," said Marvin Odum, Upstream Americas Director, Shell Energy Resources Company.  "Perdido presented technical challenges unlike we've ever seen in the Gulf of Mexico.  Shell's team used its expertise to open this new frontier and confront complex reservoir characteristics, extreme marine conditions, and record water depth pressures.  Perdido demonstrates what companies like Shell can do when US federal lands and waters are opened to responsible energy exploration and production."

From the first lease purchase to today's production, the Perdido Development required an industry workforce of approximately 12,000 people, including employees and contractors.  Shell designed, and operates, the Perdido host spar, a floating production facility, which is jointly owned by Shell (35%), Chevron (37.5%), and BP (27.5%).

The facility will produce from the Great White, Silvertip, and Tobago offshore fields, requiring perhaps as many as 35 wells over the life of the fields.  Tobago sits in more than 2,900 metres (9,600 feet) of water and surpasses the world depth record for a completed subsea well.  In addition, all Perdido subsea fields will utilise a unique an innovative subsea separation and boosting system to enable oil and natural gas recovery.

"This is a new frontier in many respects," said Odum.  "Perdido's floating production facility can be expanded to serve the future potential in the area, and we can apply the technology and expertise utilised at Perdido to other similarly challenging environments in the future."

The Perdido Development will ramp up to annual peak production of more than 100,000 barrels of oil equivalent per day.

Also in the Gulf of Mexico, Shell recently announced another deepwater discovery at Appomattox, which is in addition to recent exploration success at West Boreas, Vito, and Stones.  These discoveries underpin the potential for four new production hubs. 

Perdido fast facts:
  • One day's production from Perdido is equivalent to the energy needed to fuel 500 cars for 15 years
  • First commercial production from the Lower Tertiary reservoir in the Gulf of Mexico
  • First Gulf of Mexico full host subsea separation and boosting removes about 2,000 psi of backpressure from the wells
  • First spar wet tree Direct Vertical Access (DVA) wells in water more than two kilometers (1.2 miles) deep
  • The project achieved 10-million hours without a lost time injury
  • Located 320 kilometres (200 miles) from the Texas coast in Alaminos Canyon Block 857
  • The Great White field represents about 80% of Perdido's total estimated production
  • Perdido's project life is expected to be about 20 years
  • Construction of the Perdido host spar began in late 2006
  • Topsides were mated with the spar in a single lift in early 2009
For additional stories, photographs, a map of the area, video, and animations of the Perdido Development, visit the Perdido pages

Royal Dutch Shell plc
Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges. Shell companies have operations in more than 100 countries with businesses including oil and gas exploration and production; production and marketing of Liquefied Natural Gas and Gas to Liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects including wind and solar power. For further information, visit www.shell.com.

Cautionary statement
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate entities. In this document "Shell", "Shell group" and "Royal Dutch Shell" are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words "we", "us" and "our" are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies. ''Subsidiaries'', "Shell subsidiaries" and "Shell companies" as used in this document refer to companies in which Royal Dutch Shell either directly or indirectly has control, by having either a majority of the voting rights or the right to exercise a controlling influence. The companies in which Shell has significant influence but not control are referred to as "associated companies" or "associates" and companies in which Shell has joint control are referred to as "jointly controlled entities". In this document, associates and jointly controlled entities are also referred to as "equity-accounted investments". The term "Shell interest" is used for convenience to indicate the direct and/or indirect (for example, through our 34% shareholding in Woodside Petroleum Ltd.) ownership interest held by Shell in a venture, partnership or company, after exclusion of all third-party interest.

This document contains forward-looking statements concerning the financial condition, results of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management's expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ''anticipate'', ''believe'', ''could'', ''estimate'', ''expect'', ''intend'', ''may'', ''plan'', ''objectives'', ''outlook'', ''probably'', ''project'', ''will'', ''seek'', ''target'', ''risks'', ''goals'', ''should'' and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this document, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for the Group's products; (c) currency fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and regulatory developments including potential litigation and regulatory effects arising from recategorisation of reserves; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. All forward-looking statements contained in this document are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional factors that may affect future results are contained in Royal Dutch Shell's Annual Report and Form 20-F for the year ended December 31, 2009 (available at www.shell.com/investor and www.sec.gov - opens in new window). These factors also should be considered by the reader. Each forward-looking statement speaks only as of the date of this press release, 31 March, 2010. Neither Royal Dutch Shell nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this document.

The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this document that SEC's guidelines strictly prohibit us from including in filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov - opens in new window. You can also obtain these forms from the SEC by calling 1-800-SEC-0330.

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