Shell says halting efforts at two US Gulf deepwater wells

Houston (Platts)--2Jun2010/700 pm EDT/2300 GMT



Shell is suspending current activity on two deepwater Gulf of Mexico wells, following the US government's six-month moratorium on drilling in waters below 500 feet because of the Macondo well blowout and spill, the company said Wednesday.

The wells affected are a sidetrack to the recent Vito discovery in 4,038 feet of water and planned drilling at its Tobago field, in 9,627 feet, Shell said in a statement. Tobago is part of Shell' Perdido Hub Development that began producing in late March.

"Another planned well for our recent Appomattox discovery, previously scheduled to be drilled this summer, will now be postponed," the major said.

Shell said it has four semisubmersible drilling rigs under contract in the Gulf of Mexico, but did not immediately say whether it would keep the rigs busy outside the US.

Shell also operates four other drilling rigs on its production platforms at the Auger, Ursa and Mars fields and also at the Perdido Hub in the ultra-deepwater Alaminos Canyon area of the southern US Gulf.

The company added it was "currently evaluating its offshore business plan" for the months ahead in light of the moratorium, which will run through November 30. The ban was imposed by the White House last week and formalized over the weekend.

The moratorium rules stipulate that all companies now drilling in the deepwater US Gulf must bring their wells to a level where they can safely halt operations for the six-month period.

--Starr Spencer, starr_spencer@platts.com