Houston — BP has approved a major expansion at its Gulf of Mexico deepwater Atlantis field, and also found "significant" other oil resources that include a recently identified 1 billion more barrels in place at its storied Thunder Horse platform, the company said Tuesday.
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Those all may spur future development around four US Gulf deepwater production hubs BP operates, the company said in a statement.
The $1.3 billion Phase 3 Atlantis expansion came about after recent BP innovations in seismic imaging and reservoir characterization identified an additional 400 million barrels of oil in place at the field, BP said.
Moreover, the same advanced technology has now revealed an additional 1 billion barrels of oil in place at Thunder Horse field, for a total of nearly 3 billion barrels of oil eequivalent, according to BP slides.
"We are building on our world-class position, upgrading the resources at our fields through technology, productivity and exploration success," Bernard Looney, BP's upstream chief executive, said.
Looney added that just 12% of the hydrocarbons in place across its Gulf portfolio have been produced so far.
"We can see many opportunities for further development, offering the potential to continue to create significant value through the middle of the next decade and beyond," he added.
Thunder Horse, another of BP's four operated platforms in the Gulf -- the two others are Mad Dog and Na Kika -- is sited in 6,050 feet of water and is also offshore Louisiana. ExxonMobil is BP's 25% partner at that field.
SEES 400,000 BOE/D OF US GULF PRODUCTION BY 2025
Atlantis, along with additional reserves identified or uncovered recently, should help boost BP's Gulf of Mexico production to about 400,000 boe/d by about mid-2025, from more than 300,000 boe/d currently and less than 200,000 boe/d in 2013, the company said. Its production has grown more than 60% in the past six years.
Atlantis Phase 3 is slated to come on stream in 2020, and will hike production at the platform by roughly 38,000 boe/d. Development includes construction of a new subsea production system from eight new wells that will tie into the existing platform, located 150 miles south of New Orleans in about 7,000 feet of water.
Atlantis, said at one time to be the third largest field in the US Gulf, "is certainly one of the largest today," BP spokesman Jason Ryan said.
In conjunction with the Atlantis expansion, BP also said unveiled two Gulf of Mexico oil discoveries, Manual and Nearly Headless Nick.
TWO NEW GULF FINDS: MANUEL, NEARLY HEADLESS NICK
Manuel is about 25 miles northeast of Thunder Horse in the Mississippi Canyon area of the Gulf off the Louisiana coast and east of BP's operated Na Kika platform, which the company co-owns 50-50 with Shell. Manuel found oil pay in high-quality Miocene sandstone reservoirs. BP expects to develop Manuel in tiebacks to Na Kika.
LLOG, known for its colorful field names, operates the Nearly Headless Nick discovery further north in the Mississippi Canyon area, where BP also has a 20.25% stake. Nearly Headless Nick, named for a character in the Harry Potter book and movie series, is expected to be tied back to the LLOG-operated Delta House production facility.
BP declined to release current specific production at Atlantis or its other hubs, although it did say in a late 2018 press release that the Thunder Horse Northwest Expansion would boost that hub's output by 30,000 boe/d to over 200,000 boe/d. That expansion came online in October.
The most recent oil production figure for the Gulf of Mexico is currently around 1.74 million b/d. The number has risen in recent years as large remote deepwater fields discovered nearly a decade ago have come on stream after long periods of planning.
While a full-fledged renaissance that includes a return to widespread exploration may not be in store for the US Gulf just yet after a painful industry downturn in 2015 and 2016 that saw some Gulf producers pare down activity and others leave the area completely, interest in that sphere has perked up in the last year.
Last month, Hess said it intends to get more active in the deepwater Gulf where it operates the Tubular Bells, Stampede and Baldpate fields. Murphy Oil expressed the same desire earlier in 2018.
Also, a couple of new Gulf companies been formed with private equity funds, and existing smaller producers have become more active. Kosmos Energy entered the US Gulf last year through acquiring a private operator, Deep Gulf Energy, while Talos Energy bought Stone Energy and is eyeing further expansion.
Moreover, long-time US Gulf player LLOG which for many years was a small company that mostly stuck to shallow waters, has waded into the deepwater.
-- Starr Spencer, firstname.lastname@example.org
-- Edited by Derek Sands, email@example.com