British Petroleum announced this week that it had identified a drilling area capable of producing 1 billion barrels of oil in the Gulf of Mexico.
The discovery was made thanks to what the company referred to as “recent BP breakthrough in seismic imaging” used for oil exploration.
And the announcement came only days after Bloomberg reported that the United States had become became a net exporter of oil for the first time in decades.
Exciting news: @BP_America just announced a massive discovery at one of their existing facilities in the Gulf of Mexico.
They’re also investing $1.3 billion to further develop energy resources in the Gulf. https://t.co/FxDQqy6cYw
— The NAM (@ShopFloorNAM) January 9, 2019
In a news release, BP announced it expected to grow its gulf production to around 400,000 barrels of oil per day in the next decade.
“BP’s Gulf of Mexico business is key to our strategy of growing production of advantaged high-margin oil. We are building on our world-class position, upgrading the resources at our fields through technology, productivity and exploration success,” said Bernard Looney, BP’s Upstream chief executive, according to the news release.
“And these fields are still young – only 12 percent of the hydrocarbons in place across our 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.”
CNBC reported that BP is scheduled to start production on the new find in 2020 with eight new wells that will add 38,000 barrels per day to BP’s production in the area, which is off the coast of Louisiana.
The discovery “shows how our latest technologies and digital techniques create real value – identifying opportunities, driving efficiencies and enabling the delivery of major projects,” said Starlee Sykes, BP’s regional president for the Gulf of Mexico and Canada, said in the release.
“Developments like this are building an exciting future for our business in the gulf.”
According to its website, BP currently operates in 70 countries and has a, “larger economic footprint in the U.S. than in any other nation, and it has invested more than $100 billion here since 2005.”
In its report about U.S. oil production, Bloomberg quoted Michael Lynch, the president of Strategic Energy & Economic Research, who said, “We are becoming the dominant energy power in the world.”
“But, because the change is gradual over time, I don’t think it’s going to cause a huge revolution, but you do have to think that OPEC is going to have to take that into account when they think about cutting,” Lynch clarified.
However, an energy columnist for Forbes cautioned that elation over U.S. oil production might be premature.
Robert Rapier, a veteran chemical engineer with experience in the international energy field, noted that Bloomberg’s verdict about U.S. energy independence isn’t quite the whole story. The numbers don’t cover the whole context of the oil industry, he wrote.
Neverthess, he wrote, things are heading in the right direction.
“So the bottom line is that we aren’t net exporters of crude oil, and we aren’t energy independent. But, the U.S. has trended in that direction for over a decade. Regardless of whether it remains that way, this is undoubtedly a remarkable achievement. I know a lot of people — including myself — would have scoffed at such a prediction in 2005.”
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