Offshore field services company Subsea 7 said Friday it won a contract from Shell to help advance a redesigned concept for the Vito field in the Gulf of Mexico.

Royal Dutch Shell estimates Vito has recoverable resources of 300 million barrels of oil equivalent. Peak production of 100,000 boe per day is expected. In 2015, the Dutch supermajor started a design overhaul that reduced field development costs by about 70 percent through work with vendors like Subsea 7.

Subsea 7 said the contract value is between $50 million and $150 million.

"This award will draw on our expertise to ensure our client is given the competency, cost-efficiency and project capability they need to unlock the full potential of this significant deepwater development," Craig Broussard, the company's vice president for the Gulf of Mexico, said in a statement.

Subsea 7 has said that a period of lower crude oil prices has stimulated industry-wide efforts to become more innovative and efficient.

Development of the Vito prospect will consist of eight wells. Shell estimates the project will break even so long as the price of oil is above $35 per barrel. Brent, the global benchmark for the price of oil, was trading at around $75 per barrel early Friday.

The U.S. Energy Information Administration estimates average total U.S. oil production in the first quarter was 10.24 million barrels per day. The Gulf of Mexico represents about 15 percent of that total and production is estimated to increase from an average 1.74 million bpd to 1.85 million bpd in 2018.

Subsea 7 reported first quarter revenues of $809 million, down about 10 percent from the same period last year. Companies like Subsea 7 were under pressure from lower crude oil prices and started looking at joint ventures to weather the market storm.

Subsea 7 and Schlumberger, the largest services firm in the world, formed a joint venture partnership in February that was based on a 2015 arrangement to coordinate broad offshore development work under one umbrella. Subsea 7's move to acquire rival McDermott International was rejected.

Related Links
All About Oil and Gas News at OilGasDaily.com

Tweet

Thanks for being here; We need your help. The SpaceDaily news network continues to grow but revenues have never been harder to maintain. With the rise of Ad Blockers, and Facebook - our traditional revenue sources via quality network advertising continues to decline. And unlike so many other news sites, we don't have a paywall - with those annoying usernames and passwords. Our news coverage takes time and effort to publish 365 days a year. If you find our news sites informative and useful then please consider becoming a regular supporter or for now make a one off contribution.
SpaceDaily Contributor $5 Billed Once credit card or paypal		SpaceDaily Monthly Supporter $5 Billed Monthly paypal only

US air strike in Libya kills Qaeda operative: military
Washington (AFP) June 14, 2018
The US military has conducted an air strike in Libya targeting an Al-Qaeda affiliate, killing one "terrorist," the US military said Thursday. The Wednesday strike took place approximately 50 miles (80 kilometers) southeast of the town of Bani Walid, US Africa Command (AFRICOM) said in a statement. "In coordination with the Libyan Government of National Accord, US forces conducted a precision air strike against Al-Qaeda in the Islamic Maghreb (AQIM)... killing one terrorist," the statement read, ... read more