Deepwater Gulf of Mexico 2004: America's Expanding ... - OCS BBS

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OIL Louisiana Mississippi Alabama Texas 1000 ft 1500 ft 5000 ft 7500 ft GAS Louisiana Mississippi Alabama Texas 1000 ft 1500 ft 5000 ft 7500 ft 50 0 50 mi 50 0 50 km Existing Deepwater Pipelines New Proposed Figure 23. Deepwater oil and gas pipelines in the Gulf of Mexico. 36
LEASING Until the mid-1990's, leasing activities in the Gulf of Mexico were focused on shallow-water blocks located on the continental shelf (water depths of approximately 650 ft [200 m] or less). For example, in 1992 there were 176 leases issued in water depths less than approximately 650 ft (200 m), compared with only 28 leases issued in water depths greater than that depth. In 1995, the DWRRA established incentives for royalty relief based on water-depth intervals defined in meters. The water-depth categories depicted in figure 24 reflect the divisions used in the DWRRA. This figure shows the magnitude of the DWRRA impact, with tremendous deepwater leasing activity from 1996 through 1998 in water depths greater than 800 m (2,625 ft), where the greatest royalty relief was available. In 1992, for example, leases in water depths greater than 800 m (2,625 ft) only accounted for 3 percent of leases issued. By the end of 1998, however, this had grown to almost 70 percent. While interest in deepwater blocks increased during the mid-1990’s, interest in shallow-water blocks faded during that period. For example, shelf leases accounted for 86 percent of all leases issued in 1992, but this dropped to 23 percent by the end of 1998. BIDDING AND LEASING TRENDS The Gulf experienced a lull in leasing activities in 1999 — about a four-fold decrease compared with the 1998 levels. However, interest is rekindling in blocks in the 200-m (650-ft) or less range and in the greater than 800-m (2,625-ft) range, evidenced by increased leasing activities in the 1999-2003 interval. Note that shelf leasing has once again outpaced leasing in water depths greater than 800 m (2,625 ft). Some of the resurgent interest in the shelf area may be the result of the MMS’s recent royalty suspension program for new deep-gas development in water depths less than 200 m (650 ft). Data in figure 24 include 95 leases awarded in Sale 181 (2001) and 14 leases in Sale 198 (2003), both Eastern GOM sales. All of the leases in these Eastern GOM sales are located in water depths of 1,600 m (5,250 ft) or greater. Figure 25a was derived from the data in figure 24 but displays the deepwater categories used elsewhere in this report (shallow-water data are excluded from figure 25a). These deepwater data show the rapid increase in leasing activity that began in 1995. Although GOM leasing activity plummeted in 1999, there has since been a steady increase in leases awarded in the 1,500-4,999 ft (457-1,524 m) and the 5,000-7,499 ft (1,524- 2,286 m) intervals since that time. Figure 25b shows the total amount of money spent annually for leases in each water-depth range. Large financial investments were made by the oil and gas industry from 1996 through 1998. Bid amounts were depressed in 1999, moderately increased to 2001, and slightly decreased since that time. Most important for lease trend analysis is the average bid amount per lease as depicted in figure 25c. Overall, the average bid price for all deepwater leases steadily increased from 1992 through 2001. Beginning in 2002, there was a downturn in average bid amount per deepwater block. The high average bid amounts for 2001 reflect the fact that the industry bid large amounts per block for leases in the Eastern GOM. This was the first opportunity in 16 years for companies to bid in an area immediately adjacent to discoveries in the Central GOM area. As the value of deepwater leases increased throughout the 1990’s, MMS rejected an increasing number of deepwater high bids that it viewed as insufficient. Figure 26 shows that tracts with rejected bids moved into increasingly deeper waters over time. The rejection trend reflects the fact that, as more deepwater fields began production, they provided analogs (with high production rates, thick reservoir sections, and production infrastructure) and thus reduced the risk on similar deepwater blocks, leading to an increase in the estimated net present worth of the unleased deepwater blocks. 37
Page 2 and 3: ON COVER - The cover features four
Page 5 and 6: Table of Contents Page PREFACE.....
Page 7 and 8: Figures Page Figure 1. The Gulf of
Page 9 and 10: Figures — continued Page Figure 5
Page 11: Tables Page Table 1 List of Deepwat
Page 15 and 16: INTRODUCTION The deepwater Gulf of
Page 17 and 18: BACKGROUND DEFINITIONS The GOM Oute
Page 19 and 20: EXPANDING FRONTIER When the origina
Page 21 and 22: 1992 - 1993 Louisiana Mississippi A
Page 23 and 24: 1992 - 2003 Texas Louisiana Mississ
Page 25 and 26: fffffffffffffffff 1500 ft Quaternar
Page 27 and 28: In addition to the traditional oil
Page 29 and 30: 15 Figure 8. Gas hydrates on the se
Page 33 and 34: 4,500 4,000 Number of Active Leases
Page 35 and 36: ENVIRONMENTAL ACTIVITY The extensiv
Page 37 and 38: Operators submit a remotely operate
Page 39 and 40: 25 Figure 15. Loop and eddy current
Page 43 and 44: 29 Deepwater Discoveries $ #Y Texas
Page 45 and 46: 31 Texas ð PORT ARANSAS 1000 ft 15
Page 47 and 48: Louisiana Mississippi Alabama 33 Te
Page 49: Pipelines New pipelines Proposed pi
Page 53 and 54: Number of Leases Bid On 600 500 400
Page 59 and 60: 2004 - 2005 (741 leases) Louisiana
Page 61 and 62: DRILLING AND DEVELOPMENT Deepwater
Page 63 and 64: 49 Figure 30. The Discoverer Deep S
Page 65 and 66: 51 Number of Wells Spudded 250 200
Page 67 and 68: 120 > 7,500 ft 107 108 100 5,000 -
Page 73 and 74: 180 160 Deepwater EP Deepwater DOCD
Page 75 and 76: 340 626 390 472 472 456 393 475 590
Page 77 and 78: Year of First Production Table 4 De
Page 79 and 80: Year of First Production Table 4 De
Page 81 and 82: A predominant workhorse of the GOM
Page 83 and 84: 3 Number Installed 2 1 0 2004 69 TL
Page 85 and 86: Flow lines to host platform Subsea
Page 87 and 88: 140 131 120 100 78 Number of Wells
Page 89 and 90: RESERVES AND PRODUCTION The deepwat
Page 91 and 92: 77 Million Barrels of Oil Equivalen
Page 93 and 94: 18 16 14 12 10 8 Number of Fields 6
Page 95 and 96: 81 Million Barrels of Oil Equivalen
Page 97 and 98: 45,000 40,000 Million Barrels Oil E
Page 99 and 100: 1992-1993 1994-1995 1996-1997 Lease
Page 101 and 102:
S hallo w- wa ter GOM 11% Deepwater
Page 103 and 104:
1,200,000 1,000,000 Total productio
Page 105 and 106:
1,100,000 1,000,000 Subsea oil Tota
Page 107 and 108:
900,000 800,000 Majors Nonmajors 70
Page 109 and 110:
45,000 40,000 Max oil rate 1,000-1,
Page 111 and 112:
4,000 3,500 Shallow water Deepwater
Page 113 and 114:
Texas Auger Louisiana SS182 Troika
Page 115 and 116:
SUMMARY AND CONCLUSIONS This report
Page 117 and 118:
2,500 Number of leases Average U.S.
Page 119 and 120:
Number of Years 14 12 leas es in p
Page 121 and 122:
data for this analysis include only
Page 123 and 124:
80 2500 70 60 Number of leases dril
Page 125 and 126:
4,500 4,000 3,500 Leases tested Lea
Page 127:
• Nonmajor companies have made mo
Page 131:
REFERENCES Bascle, B. J., L. D. Nix
Page 134 and 135:
Project Name Area/Block Water Depth
Page 136 and 137:
Page 138 and 139:
Page 140 and 141:
Page 142 and 143:
Page 144 and 145:
Page 146 and 147:
Sale Number Sale Location Sale Date
Page 148 and 149:
Completed Studies [MMS Study Number
Page 150 and 151:
Group Name Company Name MMS Number
Page 152 and 153:
Group Name Company Name MMS Number
Page 154 and 155:
Appendix G. Subsea Completions. Are
Page 156 and 157:
Area Block API Number Operator Comp
Page 158 and 159:
Area Block API Number Operator 144
Page 160 and 161:
Page 162 and 163:
Page 164 and 165:
Year Shallowwater Oil (MBOPD) Deepw
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Deepwater Gulf of Mexico 2004: America's Expanding ... - OCS BBS

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