Oil companies see big Gulf of Mexico discovery
Tests suggest huge oil field found in deep waters
OSLO, Norway - Tests of a deep-water well in the Gulf of Mexico could indicate a significant oil discovery, three companies announced Tuesday, in the first project to tap into a region that reportedly could boost U.S. oil and gas reserves by as much as 50 percent.
...The Wall Street Journal reported Monday that the region where the well is located could become the nation’s biggest new domestic source of oil since the discovery of Alaska’s North Slope more than a generation ago.
The Journal said Chevron and Devon officials estimate that recent discoveries in the Gulf of Mexico’s lower-tertiary formations hold up to 15 billion barrels’ worth of oil and gas reserves, a total that would boost the nation’s current reserves by 50 percent.
msnbc.msn.com
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westexas on Tuesday September 05, 2006 at 9:48 AM EST
Re: GOM Discoveries (Plural)
One important point that seems to be escaping the MSM's attention this morning is that the oil companies are talking about the discoveries (plural) along this trend having 3 Gb to 15 Gb in total recoverable reserves.
According to the WSJ article, Devon says that its four discoveries, including "Jack" have recoverable reserves of at least 300 million barrels each.
This is not a Prudhoe Bay discovery, this is a group of discoveries they estimate will produce between 3 Gb and 15 Gb.
To put the higher figure in perspective, the world uses--from nuclear + fossil fuel sources--the energy equivalent of 15 Gb of oil in less than three months.
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That's what my research is telling me. Best source I've got (pdf) is
Emergence of the Lower Tertiary Wilcox Trend in the Deepwater Gulf of Mexico
More than 12 Bbbl of oil in place have been discovered to date. Potential recoverable reserves per discovery range from 30 to 400 MMboe, with a 69% success rate, i.e., 9/13. Trend-potential ranges from 3 to 15 Bbbl of recoverable oil. All discoveries have a common basinal setting, distal Louann salt basin rim, and are salt-cored anticlinal closures with tectonic styles ranging from thrusted symmetrical box-folds of the PFB in Alaminos Canyon (Figure 2A), to salt pillow structures of Walker Ridge (Figure 2B), and possibly continuing to asymmetrical thrusts of the Mississippi Fan Fold Belt in Green Canyon and Atwater Valley protraction areas
Look for Walker ridge + oil.
This is really deep drilling. Technical challenges are huge.
Several inherent technical challenges need to be addressed to ensure economic feasibility of the Lower Tertiary Wilcox trend. These range from the cost-effective drilling of complex salt canopies and evaluating deep structural targets to the completion and production of reservoirs in water depths that have not occurred to date. Understanding the oil chemistry, reservoir quality and associated flow capability will determine the drilling/ completion technology, and ultimately the creation of infrastructure needed to transform the Lower Tertiary Wilcox into a world-class petroleum system in the deepwater GoM. Figure 11. Schematic Wilcox depositional model with key trend wells.
The "news" is that they got a test well to flow at 6/kbd.
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Darwinian on Tuesday September 05, 2006 at 9:49 AM EST
I have been following this story of the new GOM discovery all morning on CNBC and the net. They have been putting out figures ranging from 3 billion barrels to 15 billion barrels. But the nuts and bolts of the discovery can be found here.
Devon's holdings in the region ``could more than double our current reserve base of about two billion equivalent barrels in the coming years,'' said Stephen J. Hadden, the Devon senior vice president for exploration and production. And... The partners plan to drill another appraisal well at the site in the Walker Ridge Block in 2007. A decision whether to develop Jack may be made in 2007 or 2008, Statoil's Mellbye said. The field would start production in 2013 if development goes ahead, he said..
Devon holds a 25 percent stake in the field.
On CNBC this morning, they were saying the field could produce as much as 400,000 barrels per day for 20 years. That comes out to 3 billion barrels, not 15. At any rate it should start to come on line, as they say, in 2013. That is causing oil prices to drop today.
[new] Darwinian on Tuesday September 05, 2006 at 9:55 AM EST
One more thing I forgot to mention. The field is in 7,000 feet of water and located 20,000 feet below the sea floor. That is deep. In fact, that is below the traditional oil window. This means the well will probably produce a lot more gas than oil. But they are talking about barrels of oil equalevant.
(I know, that last word is spelled wrong. And my damn spell checker wont give me a hint.
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