Offshore the East Coast in the Atlantic Continental Shelf, a treasure trove of energy reserves could be deep beneath the water, holding as much as 37 Tcf of natural gas and 3.8 billion bbl of oil, IHS Cambridge Energy Research Associates (CERA) said late Wednesday.

First production could come within a decade following the Obama administration’s decision to open part of the East Coast to exploration, IHS CERA experts noted in a report (see Daily GPI, April 1). However, how much energy is able to be tapped is still debatable, the energy consultant acknowledged.

Based on historic data, the Minerals Management Service has estimated that the Offshore Atlantic Continental Shelf contains 37 Tcf and 3.8 billion bbl of oil.

“In view of the upside potential of other Atlantic margin rift basins this estimate may be conservative,” said IHS CERA Vice President Pete Stark. “At this point, though, any resource estimate for the intriguing U.S. Atlantic Continental Shelf is very preliminary. A firmer estimate will not be available until the critical modern geophysical analyses and test results from new exploratory wells are known.”

The hydrocarbon potential of the offshore Atlantic Continental Shelf has been established by gas production offshore Nova Scotia and from flowing gas tests in five wells that were drilled about 30 years ago in the Baltimore Canyon Trough, which is about 100 miles southeast of Atlantic City. The IHS database found 35 wells that were drilled in the Baltimore Canyon Trough from 1977 through 1984.

Five of the wells in the Hudson Canyon and Wilmington Canyon offshore areas of the Baltimore Canyon Trough “reported tests of natural gas ranging from 5,500 MMcf/d to 16,000 MMcf/d from Upper Jurassic and Lower Cretaceous sandstones at depths ranging from 12,000 feet to 15,000 feet,” said IHS CERA. One well also tested about 630 b/d of oil from Upper Cretaceous sandstone.

“These hydrocarbon tests established the presence of oil and gas but the wells were determined to be noncommercial during a period of low natural gas prices and were abandoned,” said the consultant. “During the same period of time 10 exploratory wells were drilled in the Georges Bank area offshore New England and seven were drilled offshore Georgia and northeast Florida.

“The technology for exploration and production has advanced dramatically in the years since those exploratory wells were drilled, greatly expanding capabilities, but no assessment of the resource potential has been made in the Atlantic margin in the decades since.”

The Baltimore Canyon Trough was formed during the rifting between North America and Africa that began during the Middle to Late Triassic.

“This kind of geologic setting has yielded substantial — and increasing — volumes of hydrocarbons in the U.S. Gulf of Mexico and also in the south Atlantic offshore Brazil,” said Stark. “The evidence from three decades ago indicates the offshore U.S. Atlantic Continental Shelf is primarily gas prone but it is certainly possible that deeper drilling may confirm the presence of untested sub-salt formations that could boost the oil and gas potential substantially — as it is now doing off the coast of Brazil.”

The areas that have been designated for oil and gas exploration by the Obama administration are south of the Hudson Canyon and Wilmington Canyon blocks where the initial gas tests were reported, said IHS CERA.

“Therefore, these new open areas should be regarded as frontier oil and gas provinces that will require substantial investment in modern geophysical and exploration analyses to identify hydrocarbon play drillable prospects,” it said. “Thus, with favorable results it could take seven years to realize first production of oil or gas. If the leasing were in the blocks where there had already been exploration, the lead time would be closer to five years.”

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