Shell sanctions its 7th North Sea project of 2018 – Shearwater gas hub

Shell has made the final investment decision (FID) for the Shearwater gas infrastructure hub in the UK North Sea, marking, as Shell says, the company’s seventh FID for Shell in the UK North Sea in 2018.

Aerial photography of Shell’s Shearwater Platform in the Central North Sea. Copyright: Shell International Ltd / Photographer: Ross Johnston

Dry gas produced by the Shearwater platform currently flows via the Shearwater Elgin Area Line (SEAL) pipeline to Bacton, on the east coast of England. As part of the newly sanctioned project, the Shearwater platform will be modified and a 23-mile (37-kilometer) pipeline from the Fulmar Gas Line (FGL) to Shearwater installed, enabling wet gas to flow into the Shell Esso Gas and Associated Liquids (SEGAL) pipeline.

The gas will initially be processed at the St Fergus plant in Scotland prior to onward transmission of natural gas liquids (NGLs) to the Fife Natural Gas Liquids plant (FNGL) and Fife Ethylene Plant (FEP) at Mossmorran where they will be separated and exported to customers.

“This is part of our strategy to grow our gas production from around the Shearwater platform and it underscores Shell’s commitment to maximizing the economic recovery of oil and gas from the North Sea,” said Steve Phimister, Shell’s Vice President for Upstream in the UK.

“Through close collaboration with our partners and suppliers, we have been able to reduce costs, simplify the production process and create an important production hub at Shearwater. Fifty years after Shell began working in the North Sea, we continue to invest in projects to deliver more gas to UK consumers for years to come.”

Shell has been working on the ‘Central Graben strategy’, which links fields such as Fram and Arran back to the Shearwater platform hub. The strategy will see a simplification of the production process on Shearwater while maximizing the value of wet gas flowing into the SEGAL system and on to the FNGL and FEG plants at Mossmorran.

At peak production, the wet gas export capacity of the Shearwater hub is expected to be around 400 million standard cubic feet of gas a day, which equates to approximately 70,000 barrels of oil equivalent per day.

The Shearwater gas infrastructure hub follows the decision to develop the Penguins fields in the northern North Sea, the BP-operated Alligin field west of Shetland, the Fram, Arran, and Gannet E fields along with the Gannet Export infrastructure investment in the central North Sea.

Worth noting, the Shearwater will have a positive effect on other operators as well. Serica Energy has recently filed a field development plan (FDP) for the Columbus development located in the UK North Sea. The Columbus field will be drained by a single subsea well, which will be connected to the proposed Arran-Shearwater pipeline, through which Columbus production will be exported along with Arran field production.

When the production reaches the Shell-operated Shearwater platform facilities, it will be separated into gas and liquids and exported via the SEGAL line to St Fergus and Forties Pipeline System to Cruden Bay respectively. Columbus development timing will depend on the Arran-Shearwater pipeline being tied into the Shearwater platform in 3Q 2020. Columbus start-up is targeted for 2Q 2021.