Shell takes investment decision for Phase 3 Silvertip project in the US Gulf of Mexico

“This investment at Perdido is another example of our focus on high margin, lower carbon intensity barrels,” said Rich Howe, Shell’s Executive Vice President for Deep Water. “As the largest operator in the US Gulf of Mexico, we prioritize opportunities nearby our existing assets in these advantaged corridors, where we are well-positioned to develop shorter-cycle, high value tieback opportunities.”

The Phase 3 Silvertip project reinforces Shell’s long-term commitment to the United States, in particular to the Gulf of Mexico, where production is essential to ensuring a reliable and secure supply of energy. Additionally, production in the US Gulf of Mexico has among the lowest greenhouse gas (GHG) intensity in the world for producing oil.

Notes to editors

• Perdido is a production spar in the US Gulf of Mexico, located within Alaminos Canyon, approximately 200 miles offshore south of Galveston, Texas in about 8,000 feet of water.
• Shell is operator of the Perdido Regional Host (PRH) and has 35% Working Interest (WI), with Chevron U.S.A. Inc. holding 37.5% WI, 3C Perdido Holdings 26.5% and BP 1% WI.
• The development concept for Phase 3 Silvertip includes two wells, tied into existing subsea infrastructure.
• The reference to our U.S. Gulf of Mexico production having among the lowest GHG intensity in the world is a comparison among other IOGP oil-and gas-producing members.
• Current estimated recoverable resource volumes of Phase 3 Silvertip are 17 million boe. The estimate of resource volumes is currently classified as 2P under the Society of Petroleum Engineers’ Resource Classification System.
• The estimated peak production and current estimated recoverable resources presented above are 100% total gross figures.
• The investment in Phase 3 Silvertip is expected to generate an internal rate of return (IRR) in excess of the hurdle rate for Shell’s Upstream business.

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Shell’s Net Carbon Intensity

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Shell expects to publish its 2024 Energy Transition Strategy on March 14, 2024, which will include an update on Shell’s energy transition strategy and set out Shell’s climate targets and ambitions for the future.

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Source: Shell