In Gulf of Mexico, Industry Closes In On New Oil Source

Wall Street Journal ^ | 5 September 2006 | RUSSELL GOLD

[shrinkermd]

The oil industry is on the verge of cracking open a deep-water region in the Gulf of Mexico that could become the nation's biggest new domestic source of oil since the discovery of Alaska's North Slope more than a generation ago.

Chevron Corp. and partners Devon Energy Corp. and Statoil ASA announced today the first successful oil production from the region, a 300-mile-wide swath of the Gulf that lies below miles of water and deep within a bed of ancient rocks geologists call the lower tertiary. The company said the well sustained a flow rate of more than 6,000 barrels of crude oil a day during the production test...

[shrinkermd]

Better than no discovery at all.

[larrysh]

Whoops! Successfull drilling in the Gulf of Mexico,
Dems better react quick to put a stop to it!

[snoringbear]

Well, when I read this blurb and saw the "miles below below" line, I got out my trusty National Geographic World Atlas which has a section devoted to the ocean floors, depths and such. Per my atlas, the deepest trough in the Gulf of Mexico is the Mexican Basin with a depth of 3504 meters,roughly two miles deep. I was surprised. I didn't think there was that kind of deep water in the gulf. Live and learn.

[tcostell]

2007 will bring the single largest non-opec increase in crude production in history. (I've seen the field estimates) Much of this is as a result of relatively new advances in 2 key technologies, bio fuels, and deep water drilling.

If nothing else goes wrong (and that's a big if) then we could see crude prices below $50 per barrel.

[sportutegrl]

This spring, the companies parked the Cajun Express, a 350-foot floating rig, above the second well and turned on the well. Chevron says it produced 6,000 barrels of oil a day, a maximum rate set to prevent damage to equipment. They perforated only a portion of the 350-foot-thick reservoir. The oil is both light and sweet, says Mr. Siegele, the kind that commands the best prices and is in the most demand.

Good thing this is below Louisiana and not Florida or California.

[protest1]

I suspect the Dims will be drafting laws to make this illegal even as I type!

[IrishMike]

Heard on the radio it's got the potential to increase known reserves by 50%.
This is a big hit.

[mathluv]

The 'miles below' line got my attention, too. I don't know, but two mmiles just does not seem 'miles below'.

It is plenty deep. I wonder if it is in the area China was going to drill?

[johnny7]

Damn Big-Oil!

[AmericaUnited]

2007 will bring the single largest non-opec increase in crude production in history

OPEC, Iran, etc. have really screwed the pooch with these high prices. They will look back at this time and realize they got greedy and shot themselves in the foot!!

[Jimnorwellwarren]

One thing people often forget when oil prices surge is that the United States is the worlds third largest oil producer. High oil prices are a boon to many areas of our country; those areas tend to be Republican.

[Lazamataz]

Live and learn,

or,

Crash and burn.

[protest1]

"...with a deapth of 3504 meters "

Nearly 11,500 feet or 1916 fathoms deep.

http://www.engnetglobal.com/tips/convert.asp?catid=1

ps metric is evil.

[chemicalman]

It's all Bush's, Cheney's, Halliburton's fault!

[Dallas59]

This is racism against Middles East oil...oh...and Venezuela.../s

[carumba]

Someday GW Bush's evil plan to bring Iraq oil production online will scandalize the world. Evil genius will figure out a way to pump oil and raise prices at the same time. Then we will all quit running on gas and start pedaling bicycles. Environmentalist drool at the prospect. Skinny Americans eating high calorie junk food without the consequence of flab. We will have to put up with bicycle fashion and BO./s

[ASA Vet]

Momma said metric is evil.

Momma also said Daisy Mae was the devil.

[kittymyrib]

"Good thing this is below Louisiana and not Florida or California."

And poor LA really gets cheated when it sells the energy companies its oil and doesn't reap the revenue that TX gets. Texas was smart enough in coming into the US as a republic, to retain its mineral rights to the 12 miles limit of nations )the tide lands), instead of the 3 mile limit of states, and that difference has netted Texas billions over the years.
Of course, those billions go into the Permanent University Fund, earmarked only for UT and A&M, and PUF sits on those billions while Texas families struggle to pay the ever-inflating tuition costs of those universities. A thorough investigation of the PUF would be interesting.

[uglybiker]

I don't know, but two mmiles just does not seem 'miles below'.

It's not just laying there on the ocean floor.

"...lies below miles of water and deep within a bed of ancient rocks geologists call the lower tertiary."

[mathluv]

'below miles of water' - the AND takes it out of 'below'.

[Alkhin]

Oil is everywhere. Doesnt do us any damn good if we continue to allow the Watermelons to dictate how many refineries we can build (which so far has been NONE!)

[FreedomPoster]

>>Damn Big-Oil!

It's all part of a complex Rovian plot to help the GOP Presidential candidate in '08.

[johnny7]

Wouldn't you know that when oil is found... it's always those fascist, drilling types that find it? It ticks me off no end!

[Rb ver. 2.0]

"High oil prices are a boon to many areas of our country; those areas tend to be Republican."

How so?

[FreedomPoster]

If you live/work in an area/industry that benefits from drilling and platform operation and construction, etc., high oil prices tend to increase the money spent in these areas, as the economic returns for investors are higher.

[thackney]

BTTT

[Coop]

The oil is both light and sweet, says Mr. Siegele

Ugh. I hope the taste tester is well compensated... and brushes his/her teeth!

[mikeybaby]

A 350 foot production zone is hugh (and series).
Kidding aside, when I worked offshore anything over 10 feet (all things being equal) was considered producible.
For comparison, in Saudi Arabia, production zones of 2000 feet have been found.

[2001convSVT]

Now I know what oil stocks to buy! Long term recommendation.

[builder]

To paraphrase our Dem "friends".....No drilling war for oil!

[cibco]

What was the average depth of the zones that you worked in?

[mikeybaby]

The range was 8 to 60 feet, but heard guys talk of zones greater than 200 feet.
As you might imagine, this information was pretty closely guarded (but this was 25 years ago).
I only spent about 18 months working offshore for Schlumberger.
There was (and is) speculation that OPEC took prices down to discourage the US (and others) from exploration-landing us in our current situation.
There was also an attitude of "let's use their oil first and save ours" that was prevalent.

[Jimnorwellwarren]

How so? Why because the private owners of those oil/gas/coal assets get more money. You've never driven past oil stripper wells in PA, OK, KS, TX or LA?

[Jimnorwellwarren]

Penn West ain't bad, and the dividend income is decent.

[denydenydeny]

That was the thing about Southern California that was most striking the one time I visited in the 80s. Parts of the LA/Orange County metropolitan area still had oil wells seemingly everywhere, though you never saw them on TV or in movies.

I've visited parts of upstate PA where you still find oil wells pumping away even today.

[Jimnorwellwarren]

Yes, as I understand it they provide a decent extra (or primary) income for those who have them. As for me, I wish I'd bought a few thousand BPT when it was under five.