Shell has resumed oil and gas production from the Penguins field in the UK North Sea using a new floating, production, storage, and offloading (FPSO) unit, the company announced on Tuesday. This follows a recent court ruling that found government approvals for two planned UK fields to be unlawful.
The new FPSO, operated by Shell, will serve as the export route for oil and gas from the Penguins field, replacing the Brent Charlie platform, which halted production in 2021 and is being decommissioned.
The field, located 150 miles northeast of the Shetland Islands, has been redeveloped with additional wells connected to the new FPSO. Penguins, discovered in 1974, produced oil and gas from 2003 to 2021.
Shell projects peak production from Penguins to reach about 45,000 barrels of oil equivalent per day (boed). The field has an estimated recoverable resource of around 100 million barrels of oil equivalent (boe).
While Penguins is primarily focused on oil production, the field will also generate enough gas to power approximately 700,000 UK homes annually, Shell stated.
The new FPSO is expected to reduce operational emissions by 30% compared to the Brent Charlie platform and could extend the field’s lifespan by up to 20 years.
Natural gas produced from Penguins will be transported via an existing pipeline to the St Fergus gas terminal in northeast Scotland, which is part of the UK’s national gas network.
Zoë Yujnovich, Shell’s Integrated Gas and Upstream Director, emphasized that the UK heavily relies on oil and gas imports to meet its energy needs. “The Penguins field is a key source of secure domestic energy production,” she added.
The restart of production comes just days after the Scottish Court of Session ruled that the UK government’s approval for Shell’s Jackdaw and Equinor’s Rosebank fields in the North Sea was unlawful. This ruling has dampened industry expectations for new domestic oil and gas projects to help reduce the UK’s dependence on imports.
At the end of last year, Equinor and Shell announced a 50/50 joint venture to merge their UK oil and gas assets, creating the largest independent producer in the UK North Sea.
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