Royal Dutch Shell plc, through its Shell Brasil Petróleo Ltda. subsidiary and consortium partners, recently announced that FPSO P-69 has begun deep-water production at the Lula Extreme South in Brazil’s Santos Basin. Reportedly being operated by Petrobras, FPSO P-69 is able to process up to 150,000 barrels of oil along with 6 million cubic meters of natural gas every day.

According to Shell, the P-69 will boost production via 8 producing and 7 injection wells. P-69 is apparently Shell’s 14th deepwater FPSO in Brazil, where the company has FPSOs in the pre-salt Santos and Campos basin. Shell operates the BC-10 as well as the Bijupira and Salema FPSOs.

Andy Brown, Shell’s Upstream Director, was quoted saying that Brazilian pre-salt fields are among the best deepwater provinces globally, and due to significant flow rates deepwater projects in Brazil break even at less than $40 per barrel. Commending Petrobras for achieving this milestone, Brown said Shell would look to progress additional development plants with its consortium partners.

After Lula Extreme South, the next FPSO would be P-67 planned for Lula North, said sources with knowledge of the matter. Under the continuing Libra product sharing agreement, progress has been made with an extended well test and the Mero 1 FPSO, with plans for additional FPSOs. Shell has also planned development drilling in 2019 for the Gato do Mato South field, which it operates, the sources mentioned.

For the record, Shell holds a 25% stake in the Lula consortium, operated by Petrobras that has a 65% stake, with Galp’s subsidiary Petrogal Brasil holding the remaining 10% interest. The deep water business of Shell produces nearly 740 thousand barrels of oil equivalent per day (boe/d) and by 2020, is anticipated to reach about 900 thousand boe/d from already discovered and established areas.

Recent bid rounds provide Shell with significant opportunities for additional deep water discoveries. Shell’s total operated presence offshore Brazil has extended to 27 concessions and approx. 2.7 million acres.