Shell Offshore Inc, a subsidiary of Royal Dutch Shell plc, today announces the final investment decision for Vito, a deep-water development in the U.S. Gulf of Mexico with a forward-looking, break-even price estimated to be less than $ 35 per barrel. This decision sets in motion the construction and fabrication of a new, simplified host design and subsea infrastructure.
Vito is expected to reach peak production of approximately 100,000 barrels of oil equivalent (boe) per day, which represents a significant contribution to our continued growth in the Gulf of Mexico. The development currently has an estimated, recoverable resource of 300 million boe.
n++With a lower-cost developmental approach, the Vito project is a very competitive and attractive opportunity industry-wide,n++ said Andy Brown, Shell Upstream Director. n++Our ability to advance this world-class resource is a testament to the skill and ingenuity of our development, engineering and drilling teams.n++
In 2015, Shell began to redesign the Vito project, reducing cost estimates by more than 70% from the original concept. Vitos cost savings are due to the simplified design, in addition to working collaboratively with vendors in a variety of areas including well design and completions, subsea, contracting, and topsides design.