Hess Corp. will proceed with the development of Tubular Bells, a deepwater oil and gas project it operates in the Gulf of Mexico (GOM), the company said Tuesday. Drilling is scheduled to begin in 2012, and initial production is expected in 2014, subject to permitting.

Discovered in 2003, Tubular Bells is about 135 miles southeast of New Orleans in the Mississippi Canyon area of the GOM. The field lies in water depths of 4,300 to 4,600 feet and is named after musician Mike Oldfield’s 1973 debut album, which provided some of the music in The Exorcist.

The development plan initially calls for three subsea production wells and two water injection wells from two subsea drill centers tied back to a third party-owned spar production facility, the first of its kind to be constructed entirely in the United States, Hess said.

Williams Partners LP is to design, construct and install the system, which could serve as a central host facility for other deepwater prospects in the area. It said it will use its Gulfstar floating production system and would be able to process up to 60,000 b/d of oil and 200 MMcf/d of gas (see Daily GPI, May 26).

Annual gross production is expected to peak in the range of 40,000–45,000 boe/d. Total estimated recoverable resources for Tubular Bells are estimated at more than 120 million boe. The development is estimated to cost $2.3 billion, with additional commitments for production handling, export pipeline, and oil and gas gathering and processing services.

Following Bureau of Ocean Energy Management approval of the recent assignment of BP plc’s interest, Hess will hold a 57.14% interest in the field, and Chevron U.S.A. Inc. will hold the remaining 42.86%.

In recent days BP received preliminary approval from federal regulators to drill four deepwater wells in the GOM Keathley Canyon, its first offshore permit approval since the Macondo well blowout in April 2010 (see Daily GPI, Oct. 25).

©Copyright 2011Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.