Shell launches new FPSO unit in the North Sea, restoring production from the Penguins field

Shell has restarted production from the Penguins field in the UK sector of the North Sea using a modern floating production, storage, and offloading (FPSO) unit. The project is carried out in collaboration with NEO Energy (ownership: Shell 50% - operator, NEO Energy 50%). The previous oil export system for this field relied on the Brent Charlie platform, which ceased production in 2021 and is currently being decommissioned.

16 february 2025   |   19:33   |   Source: Gazeta Morska   |   Prepared by: Kamil Kusier   |   Print

fot. Shell

The estimated peak production of the Penguins field is approximately 45,000 barrels of oil equivalent per day (boe/d). The current estimated recoverable resources of the field are around 100 million boe. While crude oil is the primary output, the project will also provide enough natural gas to heat approximately 700,000 UK households annually.

The new FPSO unit features 30% lower operational emissions compared to the Brent Charlie platform and will extend the life of the Penguins field by up to 20 years.

Investment in energy security and operational efficiency

- Today, the UK relies heavily on imports to meet its oil and gas demand, said Zoë Yujnovich, Shell’s integrated gas and upstream director. - The Penguins field is an important source of secure domestic energy production, and our new FPSO unit demonstrates our commitment to investing in competitive projects that create more value with fewer emissions.

The crude oil extracted from the Penguins field will be transported by tankers to refineries outside the UK, including those supplying finished products such as gasoline and diesel to the British market. Natural gas will be transported via an existing pipeline to the St Fergus gas terminal in northeast Scotland, from where it will enter the UK’s national gas network.

Advanced technologies and production optimization

The redevelopment of the Penguins field involved drilling additional wells, which have been tied back to the new FPSO unit. The field is located at a depth of 165 meters (541 feet), approximately 150 miles northeast of the Shetland Islands. It was discovered in 1974 and previously produced oil and gas between 2003 and 2021.

The new FPSO unit, built by Norwegian company Sevan, is the first new Shell-operated facility in the UK North Sea for over 20 years. Its cylindrical hull design provides greater operational efficiency and flexibility. Additionally, it features a flareless system that recycles hydrocarbon vapors, reducing emissions.

Shell and Equinor form a new powerhouse in the North Sea

As announced on December 5, 2024, Shell U.K. Limited and Equinor UK Ltd will combine their UK offshore oil and gas assets and expertise to create a new company, which will become the largest independent producer in the region. Upon completion of the transaction, the new company will be 50% owned by Equinor and 50% by Shell. The joint venture will take over Shell’s equity interests in the Penguins field.

According to data from the North Sea Transition Authority, UK oil and gas production declined by 11% over the past year, and domestic production is falling faster than demand. As part of its long-term strategy, Shell announced at its 2023 capital market day that it is committed to delivering upstream and integrated gas projects with a combined peak production of more than 500,000 boe/d by 2025. The Penguins field is expected to play a key role in achieving this target.

Shell continues its efforts to reduce emissions and achieve net-zero carbon emissions by 2050. By the end of 2023, the company had met over 60% of its goal to halve emissions from its operations (scopes 1 and 2) by 2030 compared to 2016 levels.

With its modern technology and long-term investment strategy, Shell is strengthening its position in the North Sea region, ensuring stable oil and gas supplies while reducing the carbon footprint of its operations.

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