BP plc now has nine rigs operating in the deepwater Gulf of Mexico (GOM) -- a record high -- to ramp up development in the Thunder Horse field and from the Mad Dog platform.
The West Auriga, a new ultra-deepwater drillship under long-term contract from Seadrill Ltd., is drilling at the Thunder Horse field. The rig is capable of operating in up to 12,000 feet of water. At the Mad Dog complex, a reconstructed, state-of-the-art driller is replacing the original rig, badly damaged and left inoperable in 2008 by Hurricane Ike.
"The addition of these two rigs reflects the vital importance of the deepwater Gulf of Mexico to the future of BP," said BP GOM Regional President Richard Morrison. "It also clearly demonstrates BP's commitment to the American economy and to U.S. energy security."
BP had eight rigs in operation at the end of October, and the GOM drove most of BP's U.S. output gains in 3Q2013, said Group CEO Bob Dudley (see Daily GPI,Oct. 29). Next year Na Kika 3 is scheduled to startup, along with the mega-platform Mars B. The Gila exploration well also is progressing.
Over the next decade BP management has said it expects to invest on average at least $4 billion every year in the GOM. Activity and investment is to center around four operated production hubs: Thunder Horse, Na Kika, Atlantis, and Mad Dog. Three nonoperated production hubs in the deepwater also will see more capital investment: Mars, Ursa and Great White. In addition, "significant exploration and appraisal opportunities in the Paleogene and elsewhere" are anticipated.
BP has a lot riding on the success of its deepwater GOM portfolio. Three years ago BP pledged an overriding royalty interest in oil and natural gas production from the fields collateral for the Deepwater Horizon Oil Spill Trust, a $20 billion fund set up to pay Macondo-related disaster claims (seeDaily GPI,Oct. 4, 2010).
A pipeline of future development projects also is on the drawing board. In April BP ramped up the Atlantis North expansion, the first of seven additional wells to be tied back to the existing platform. At Na Kika, another field expansion is planned following the startup in 2012 of the Galapagos development, a subsea tieback. A second phase of the Mad Dog field also is planned.
BP said it was the largest oil and gas producer in the deepwater GOM in 2012, when output accounted for 214,000 boe/d, management noted. The operator has ownership in more than 650 leases in the GOM, making it still one of the top leaseholders.