Shell offshore project suffers another setback

Shell Pakistan offshore project for exploration in Pakistan's deep waters suffered another setback as 'Transocean'-the rig-mounted ship-could not clear trial after maintenance. The ship was brought into deep waters in Arabian Sea early this month for trial but failed to work properly. The trial failure led to the ship's return to Singapore for proper maintenance.
The failure is going to delay the project for an indefinite period. The project has not been taking off since 2004, and now technical failure of the ship-mounted rig has made it next to impossible to happen. Sources said the rig-mounted ship, hired by the joint venture, is still not ready due to some technical problem and since the repair work is in progress the partners expect its entry in Pakistan's territorial waters by middle of August.
Will it happen? It's premature to say something with authority, but at least the joint venture partners have no other option but to build up hopes against hopes.
One of the joint venture partners told Business Recorder on Thursday that Shell Pakistan, operator of the project, has conveyed to the partners that due to some technical problem the rig-ship's movement from Singapore, where it was stationed for maintenance, had been delayed.
Earlier, Shell Pakistan had conveyed to partners that rig was arriving in Pakistan's territorial waters in the first week of July for drilling work on the offshore project.
It's forth delay in the start of the offshore project during the last two and half years. Shell Pakistan had entered in a joint venture for offshore exploration work with OGDC, PPL and Government Holdings in 2004 and the cost of the project was estimated at $ 21 million. Shell Pakistan as an operator signed an agreement with Transocean, an American services company, for supply of rig-ship.
The work on the project was to start in 2005. But, despite repeated assurances to the operators, rig availability could not be ensured. Delay costs the joint venture partners heavily as estimated expenditures went up from $ 21 million in 2005, to $ 40 million in May 2007, and still there is no sign of availability of rig-ship.
Inordinate delay is worrying the partners, which are public sector companies and can not afford further delay.
Secondly, further delay may put the project at risk as monsoon weather is around when sea becomes hostile that can make exploration work impossible due to high tide.