Mars and Auger Flexjoint Repairs Delayed

Due to ongoing loop currents in the area, Shell will delay the shut down of its Mars tension leg platform (TLP) for replacement of the flexjoints on both its oil and natural gas export lines. These types of currents affect the safe and effective diving operations that are essential to complete the flexjoint repairs. In January, Shell announced the repairs would commence on or around March 17, weather permitting.

While a precise repair date is not known, Shell will continue to monitor the loop currents with the possibility that this work can begin in the mid- April to late-May timeframe. The repairs will take an estimated 14 days to complete.

Loop currents form when a portion of the Gulf Stream enters the Gulf of Mexico through the Yucatan Straits, flow north, and turn east and south to exit the Florida Straits forming a "loop." The loop current is a permanent oceanographic feature in the Gulf of Mexico and, at certain times of the year, can extend north far enough to impact deepwater lease blocks in the central Gulf of Mexico.

The Mars TLP, located in Mississippi Canyon Block 807 in the Gulf of Mexico, was initially shut in on May 22 last year when Shell discovered damage to the oil pipeline flexjoint. Subsequent inspections of the natural gas line showed signs of deterioration on its flexjoint as well. A decision was made to make temporary repairs to both lines while the flexjoints were refurbished. Production resumed at Mars on June 28.

Shell is the operator of the Mars TLP with a 71.5 percent interest. BP has the remaining 28.5 percent interest in the project.

The flexjoint replacement at Shell's Auger TLP, also referenced in the January announcement, will now be delayed until the June-July timeframe. This work utilizes much of the same equipment and resources needed at Mars; it is still estimated that the repairs at Auger will take 10 to 14 days to complete.

Auger is located in Garden Banks 426 in 2,860 feet of water. Shell has a 100% interest in the Auger platform and is the operator.

Mars currently produces 140,000 barrels of oil and 156 million cubic feet of gas, per day. Auger current production is 75,000 barrels of oil and 180 million cubic feet of gas, per day.

Inspections of the remaining oil and gas export flexjoints, as well as all flowline flexjoints, on Shell's TLP revealed no deterioration.