Shell producing oil from first deepwater Malaysian well

Dutch energy company Shell said Wednesday it started production from a deepwater field in Malaysia, where output should reach 135,000 barrels per day.

Shell started production from the Gumusut-Kakap deepwater platform in waters more than half a mile deep.

"Gumusut-Kakap is our first deep-water development in Malaysia, and uses the best of Shell's global technology and capabilities in deep water," Andrew Brown, an upstream director for Shell, said in a statement.

Oil from the field will be sent through a 125-mile pipeline to onshore terminals.

The company in August announced a natural gas discovery in the Majoram-1 well, a deepwater well located about 110 miles off the Malaysian coast, but provided no estimate of the reserve potential.

Analysis from Wood Mackenzie said Malaysia is on pace to become one of the largest suppliers of liquefied natural gas in the world.