Two announcements last week indicate that Gulf of Mexico (GOM) discoveries have not ended, nor have producers put their deepwater work on the back burner.

In the first news early last week, Kerr-McGee said it has ramped up development of its Constitution field in the Gulf of Mexico (GOM), which is estimated to have proven and probable reserves of 110 MMboe. First production is expected by mid-2006, with peak production expected to reach 40,000 bbl/d and 75 MMcf/d in 2007.

Meanwhile, Unocal Corp. and its partners reported that their Puma prospect, located in Green Canyon block 823, has hit a “significant” discovery in a hydrocarbon-rich area near existing developments. As operator, BP holds a 52% working interest, Unocal holds 15% and the remaining 33% is held by BHP Billiton Ltd.

Kerr-McGee’s Constitution field is located in 5,000 feet of water at Green Canyon blocks 679 and 680, and total project costs for the wholly owned project, including $125 million spent to date on leases and drilling, will be $600 million.

“Constitution is the next milestone in our successful deepwater exploration and development program,” said Kerr McGee CEO Luke R. Corbett. “A stand-alone facility at Constitution enables us to dramatically accelerate the development timetable for this significant field.” Corbett said the spar would create Kerr-McGee’s sixth deepwater hub.

Perhaps in response to Royal Dutch/Shell Group’s recategorization of its reserves last week (see NGI, Jan. 12), Kerr-McGee reassured analysts and investors by noting in a statement that Constitution’s estimated reserves had been substantiated by third-party tests and extensive engineering. The company said, “The Constitution field was confirmed by 11 penetrations into predominantly oil-bearing sands in seven hydrocarbon-bearing reservoirs. These high-quality reservoirs have an average porosity of 28%, permeability of approximately 800 millidarcies and oil gravity of approximately 32 degrees API. The Pliocene reservoirs are located at depths from 12,500 feet to 15,000 feet.”

Dave Hager, Kerr-McGee’s senior vice president for oil and gas exploration and production, said that the “extensive appraisal program and evaluation process, combined with our deepwater Gulf of Mexico experience, reinforce our resource estimates and provide a strong foundation for the productivity of this field.” He added that Ryder Scott had reviewed the geoscience and engineering data and “verified our approach to the assessment of the reserves for Constitution.”

In the discovery by BP and its joint partners, Unocal said that the Puma well spudded on Aug. 14 and was drilled in 4,130 feet of water. Drilled to a depth of 19,034 feet, the Puma discovery well encountered approximately 500 net feet of oil pay in Miocene-age reservoirs. Two subsequent sidetrack bores encountered oil in reservoir intervals of a similar age. Initial indications of reservoir productivity are encouraging, Unocal said, based on preliminary analysis of sidewall cores and fluid samples taken from the well.

The BP-operated Puma well lies immediately to the west of the Mad Dog development (Green Canyon 826), where production startup is planned for early 2005. Mad Dog was discovered in 1999, and its net resource potential is expected to be higher than 100 MMboe, and possibly twice that (see NGI, April 13, 1999).

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