Yahoo Finance Shell (SHEL) Resumes Pierce as Upgrade Allows Gas Production
Shell plc SHEL recently announced through its subsidiary Shell UK Ltd. that it had completed resuming operations at the Pierce field in UK's North Sea. After years of producing oil solely, significant upgrades allowed gas production, leading to the field’s restart.
Pierce is a joint venture that exists between Shell businesses (92.52%) and Ithaca Energy (UK) Limited (7.48%). The Pierce field is located around 165 miles (265 km) east of Aberdeen, Scotland, in water that is approximately 262 feet (85 m) deep. Oil has been produced there since 1999, following its 1975 discovery.
The Haewene Brim floating production, storage and offloading (FPSO) vessel, which is utilized to produce hydrocarbons in the field, has undergone modifications. Additionally, a new subsea gas export line was installed, linking to the SEGAL pipeline system, which transports gas to St Fergus, north of Aberdeen, where it is brought ashore.
The FPSO, which is owned and run by Pierce Production Co. Ltd., a Bluewater company, ceased production in October 2021 in order to provide room for upgradation. It was transformed into a vessel that could also produce gas, which had previously been re-injected into the reservoir, during its 6 months stay in dry dock.
With more gas being produced than oil, the gross peak output is anticipated to exceed 30,000 boe/d, over two times of what it was before redevelopment.The oil will be carried by tankers as earlier, while the gas will be transported by recently built subsea pipes.
Shell Upstream Director Zoe Yujnovich stated that this investment decision was made in 2019, and it is now increasing locally produced gas at a time when this additional supply is critical for UK's energy security.
Zacks Rank & Key Picks
Currently, Shell carries a Zack Rank #4 (Sell).
Some better-ranked stocks for investors interested in the energy sector are CVR Energy CVI, Par Pacific Holdings Inc. PARR and Valero Energy Corporation VLO. While CVI and PARR sport a Zacks Rank #1 (Strong Buy), VLO carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
CVR Energy, a diversified holding company with its main office in Sugar Land, TX, is an independent refiner and marketer of high value transportation fuels. Over the past seven days, CVI has seen an upward revision in earnings estimates for 2023.
Par Pacific, a growth-oriented company, combines knowledge of corporate financing with experience in the oil and gas sector. With 94,000 barrels per day of active refining capacity and a logistical system that includes an SPM, storage, barges, pipelines and trucking operations, PARR owns and manages one of Hawaii's biggest energy networks. Over the past 30 days, the company has witnessed an upward revision in earnings estimates for 2023 and 2024.
Valero Energy is a global manufacturer and marketer of transportation fuels and petrochemical products. With 15 refineries spread across Canada, the United States and United Kingdom, VLO has a daily refining capacity of 3.1 million barrels. Over the past seven days, the company has seen an upward revision in earnings estimates for 2023 and 2024.
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