New development plan Shell

On February 21, Shell notified SBM about the revision of the development plan for the oil and gas condensate field (Fram), which led to the refusal to continue several key contracts related to this development, including the construction of FPSO. The SBM Offshore Company confirms this. After the discovery of Fram’s NGMF in 1969, 3 exploration wells were drilled: 1 well in 1999 and 2 in 2009.

Exploratory drilling proved that there are sufficient recoverable reserves of hydrocarbons.

According to the Shell’s data, the field contains about 390 million barrels of oil and gas in proportion approximately 2/3 of gas and 1/3 of oil.

After this news, Shell, being the operator and coordinator of the development program of NGKM Fram, and Esso Exploration Production U.K significantly intensified their efforts in the development of the project.

The scope of the project

low angle photography of Shell gas station at night

NGKM Fram has become one of the largest deposits at present, of those planned to be developed in the British sector of the North Sea within the next 5 years with the possibility of transportation.

Fram is located in the central part of the North Sea about 221 km southeast of Aberdeen.

It was assumed that Fram NGKM would be developed with the help of 2 subsea production wells connected to a floating oil production, storage, and unloading complex (FPSO).

A solution of the company

Shell’s decision to use this type of FPSO was due to several reasons, including a shorter construction time for FPSO, as well as optimal compliance for hydro-meteorological and environmental conditions in this area of the North Sea.

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In October, Shell’s Vice President announced that Fram NGKM would reach a peak capacity of about 35,000 barrels per day in 2 years from the beginning of the commercial operation. In July, the offshore platform Diamond Offshore Drilling Inc. was installed at OGKM. As there was no final investment decision, the project was not included in the SBM Offshore portfolio.

SBM Offshore began work on the FPSO solution for this field after receiving a letter on the interim solution (LoIA) on June 15.

In March, Shell and SBM Offshore signed the Agreement for a period of 5 years with the possibility of extending for another 5 years, for the supply of small and medium-sized FPSO under lease and operation conditions.