Shell invests in the Gato do Mato project in Brazil's pre-salt

Rhea-AI Summary

Shell has announced its Final Investment Decision (FID) for the Gato do Mato deep-water project in Brazil's pre-salt Santos Basin. The project, operated by Shell (50% stake) in consortium with Ecopetrol (30%) and TotalEnergies (20%), will feature a floating production storage and offloading (FPSO) vessel designed to produce up to 120,000 barrels of oil per day.

The development has estimated recoverable resources of approximately 370 million barrels and is expected to commence operations in 2029. Located offshore Rio de Janeiro in water depths of 1,750 to 2,050 metres, the project covers two blocks: BM-S-54 and Sul de Gato do Mato. Initial operations will involve natural gas reinjection for reservoir pressure support, with future potential for onshore gas export.

Positive

• Project expected to generate IRR exceeding Shell's Upstream business hurdle rate
• Strengthens Shell's position as largest foreign producer in Brazil
• Significant resource base of 370 million recoverable barrels
• High production capacity of 120,000 barrels per day

Negative

• Long development timeline with operations starting in 2029
• Initial operations to gas reinjection without immediate gas monetization

RIO DE JANEIRO, March 21, 2025 /PRNewswire/ -- Shell Brasil Petróleo Ltda. (Shell Brasil), a subsidiary of Shell plc, has taken the Final Investment Decision (FID) for Gato do Mato, a deep-water project in the pre-salt area of the Santos Basin, offshore Brazil.   

The Gato do Mato Consortium includes Shell (operator with a 50% stake), Ecopetrol (30%), TotalEnergies (20%) and Pré-Sal Petróleo S.A. (PPSA) acting as the manager of the production sharing contract (PSC). The development plan includes the installation of a floating production storage and offloading (FPSO) vessel and is designed to produce up to 120,000 barrels of oil per day. Current estimated recoverable resource volumes of the Gato do Mato development are approximately 370 million barrels.

"Gato do Mato is an example of our ongoing investment in increasingly efficient projects," said Zoë Yujnovich, Shell's Integrated Gas and Upstream Director. "The project contributes to maintaining stable liquids production from our advantaged Upstream business, and expands our leadership as the largest foreign producer in Brazil as we continue working to provide for the world's energy needs well into the future." 

The consortium anticipates that the Gato do Mato field will commence operations in 2029.  

Notes to editors 

• Located in the Santos Basin, the Gato do Mato project is a pre-salt gas-condensate discovery that covers two contiguous blocks: BM-S-54, a concession contract entered into in 2005, and Sul de Gato do Mato, a production sharing agreement obtained in 2017.
• Initial operations will involve the reinjection of natural gas for reservoir pressure support, with future optionality to export gas to onshore facilities.
• The blocks are offshore Brazil from the Rio de Janeiro coast, in water depths ranging from 1,750 to 2,050 metres.
• Resource volumes are 100% total gross and a P50 estimate under the Society of Petroleum Engineers' Petroleum Resources Classification System. P50 means there is a 50% probability of the estimate being lower and a 50% probability of being higher.
• The investment in Gato do Mato is expected to generate an internal rate of return (IRR) in excess of the hurdle rate for Shell's Upstream business.

Cautionary note
The companies in which Shell plc directly and indirectly owns investments are separate legal entities. In this press release "Shell", "Shell Group" and "Group" are sometimes used for convenience where references are made to Shell plc and its subsidiaries in general. Likewise, the words "we", "us" and "our" are also used to refer to Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ''Subsidiaries'', "Shell subsidiaries" and "Shell companies" as used in this press release refer to entities over which Shell plc either directly or indirectly has control. The term "joint venture", "joint operations", "joint arrangements", and "associates" may also be used to refer to a commercial arrangement in which Shell has a direct or indirect ownership interest with one or more parties. The term "Shell interest" is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.

Forward-Looking Statements
This press release contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results of operations and businesses of Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Shell to market risks and statements expressing management's expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as "aim"; "ambition"; ''anticipate''; ''believe''; "commit"; "commitment"; ''could''; ''estimate''; ''expect''; ''goals''; ''intend''; ''may''; "milestones"; ''objectives''; ''outlook''; ''plan''; ''probably''; ''project''; ''risks''; "schedule"; ''seek''; ''should''; ''target''; ''will''; "would" and similar terms and phrases. There are a number of factors that could affect the future operations of Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this press release, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell's products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, judicial, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; (m) risks associated with the impact of pandemics, such as the COVID-19 (coronavirus) outbreak, regional conflicts, such as the Russia-Ukraine war, and a significant cybersecurity breach; and (n) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this press release are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional risk factors that may affect future results are contained in Shell plc's Form 20-F for the year ended December 31, 2023 (available at www.shell.com/investors/news-and-filings/sec-filings.html and www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this press release and should be considered by the reader. Each forward-looking statement speaks only as of the date of this press release, March 21, 2025. Neither Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this press release.

Shell's net carbon intensity
Also, in this press release we may refer to Shell's "Net Carbon Intensity" (NCI), which includes Shell's carbon emissions from the production of our energy products, our suppliers' carbon emissions in supplying energy for that production and our customers' carbon emissions associated with their use of the energy products we sell. Shell's NCI also includes the emissions associated with the production and use of energy products produced by others which Shell purchases for resale. Shell only controls its own emissions. The use of the terms Shell's "Net Carbon Intensity" or NCI are for convenience only and not intended to suggest these emissions are those of Shell plc or its subsidiaries.

Shell's net-Zero Emissions Target
Shell's operating plan, outlook and budgets are forecasted for a ten-year period and are updated every year. They reflect the current economic environment and what we can reasonably expect to see over the next ten years. Accordingly, they reflect our Scope 1, Scope 2 and NCI targets over the next ten years. However, Shell's operating plans cannot reflect our 2050 net-zero emissions target, as this target is currently outside our planning period. In the future, as society moves towards net-zero emissions, we expect Shell's operating plans to reflect this movement. However, if society is not net zero in 2050, as of today, there would be significant risk that Shell may not meet this target.

Forward Looking Non-GAAP measures
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SOURCE Shell

FAQ

What is the production capacity of Shell's Gato do Mato project (SHEL)?

The Gato do Mato project is designed to produce up to 120,000 barrels of oil per day.

When will Shell's Gato do Mato field (SHEL) begin operations?

The Gato do Mato field is anticipated to commence operations in 2029.

What are the estimated recoverable resources for Shell's Gato do Mato project (SHEL)?

The project has estimated recoverable resources of approximately 370 million barrels.

What is Shell's ownership stake in the Gato do Mato project (SHEL)?

Shell is the operator with a 50% stake, partnering with Ecopetrol (30%) and TotalEnergies (20%).

What are the water depths for Shell's Gato do Mato project (SHEL)?

The project is located in water depths ranging from 1,750 to 2,050 metres offshore Brazil.