Shell’s Vito deepwater project: “Break-even at $35 per barrel”

Written by Marine Log Staff
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Jumbo Offshore's Fairplayer will support installation work at the Vito deepwater project

MAY 9, 2018 — The downturn in the price of oil over the past few years forced oil and gas producers to rethink their approach to deepwater offshore oil and gas development. A great example of that new approach is Shell’s Vito project, which is being developed in 4,000 feet of water some 150 miles southeast of New Orleans in the U.S. Gulf of Mexico.

Shell Offshore Inc. (Shell), a subsidiary of Royal Dutch Shell plc, announce on April 24 its final investment decision for Vito, a deepwater development in the U.S. GoM 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. 

The Vito development is owned by Shell Offshore Inc. (63.11% operator) and Statoil USA E&P Inc. (36.89%). Vito is expected to reach peak production of 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.

Infographic at right generated by Shell provides an overview of the size and scope of the Vito project.slide vito fid fact sheet

“With a lower-cost developmental approach, the Vito project is a very competitive and attractive opportunity industry-wide,” said Andy Brown, Shell Upstream Director. “Our ability to advance this world-class resource is a testament to the skill and ingenuity of our development, engineering and drilling teams.”

Jumbo awarded installation contract
Dutch operator Jumbo Offshore was recently awarded an installation contract that involves the initial pre-lay of the mooring system as well as the subsequent tow and hook-up of the FPS.

Roddy Lafontaine, VP Offshore for Jumbo says, “The Jumbo Offshore team is very grateful to Shell for this opportunity. It is the first time Jumbo and Shell will work directly together in U.S. deep-water Gulf of Mexico and we are 100 percent committed to the successful completion of this project. Our engineers are already working on the detailed plans so as always we can perform a reliable, smart and efficient execution.’’

Jumbo’s 144.1m DP2 Heavy Lift Crane Vessel Fairplayer will be deployed for the work. Fairplayer is equipped with two mast cranes with a Safe Working Load (SWL) of 900Te each. The dual cranes provide tandem heavy lift capacity, dual crane upending capability as well as deepwater lowering capability.

The main deck has an exceptionally large working area of 3,100 m2 and offers a loading capacity of 12 Te/m2. The adjustable tween deck has an area of 1,700 m2 and offers a loading capacity of 7 Te/m2 and the lower hold area of 1,400 m2 has a loading capacity of 12 Te/m2.

Downturn prompts rethink
In 2015, Shell began to redesign the Vito project, reducing cost estimates by more than 70% from the original concept. Vito’s 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.

With 40-years of Shell leadership in deep water, Vito will be Shell’s 11th deep-water host in the Gulf of Mexico and is currently scheduled to begin producing oil in 2021. With global production progressing to more than 900,000 boe per day, Shell has deep-water projects and opportunities in the U.S., Brazil, Nigeria, Malaysia, and Mexico.


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