• 4 minutes China 2019 - Orwell was 35 years out
  • 7 minutes Wonders of US Shale: US Shale Benefits: The U.S. leads global petroleum and natural gas production with record growth in 2018
  • 11 minutes Trump will capitulate on the trade war
  • 14 minutes Glory to Hong Kong
  • 3 hours The power of propaganda has no boundaries: Which country has larger territory US od China
  • 3 hours Freedom of Speech for Dummies
  • 50 mins Boring! See Ya Clowns, And Have Fun In Germany
  • 8 hours Iranian Oil Tanker struck by missiles off Jeddah
  • 4 hours Crazy Stories From Round The World
  • 5 hours South Korea Unveils Fighter Jet Mock-Up Amid Program Challenges
  • 20 hours Support Held. Back in UGAZ
  • 8 hours Any difference btw Hunter Biden on BOD of Ukraine Company vs. Qatar bailout of Kushner Real Estate 666 Fifth Ave ?
  • 3 hours How The US Quietly Lost The 1st Amendment
  • 7 hours National Geographic Warns Billions Face Shortages Of Food And Clean Water Over Next 30 Years
  • 1 day ISIS Prisoners Escape Syria Camp After Turkish Shelling. Woohoo!
  • 1 day 5 Tweets That Change The World?
  • 1 day China's Blueprint For Global Power

Breaking News:

Can Tesla Survive Without Tax Credits?

Gulf of Mexico: Preparing for August Auction

Bottom Line: Tentatively scheduled for 28 August, the US government is auctioning off over 21 million acres on the Outer Continental Shelf in 3,953 blocks in shallow and deep waters. If things go as planned, production on these blocks could see another 200 million barrels of oil and up to 900 bcf of natural gas.

Offshore Gulf of Mexico

Analysis: This is Lease Sale 233, to be held in New Orleans, and it is the third such under the Obama administration. The blocks up for grabs are in waters in depths of 16 feet to 11,000 feet. As we noted in last week’s newsletter, the last auction in March showed revived interest from previous auctions, generating $1.2 billion in bids. Overall, we’re looking at 11.5 trillion cubic feet of proven gas resources in the Gulf of Mexico, plus 1.4 billion barrels of proven crude reserves, with new fields coming online and new discoveries increasing in frequency. Deep-water development is picking up, focusing on the Miocene and Tertiary structures, with Lower Tertiary plays sitting beneath a thick layer of salt.

Recommendation: We think it’s a good time to get in on the Gulf of Mexico, especially in view of all the activity in Brazil. Further sweetening the deal, Anadarko Petroleum has announced another discovery in the deep waters of the Gulf of Mexico, encountering oil pay during the drilling of its Phobos-1 well, with about 250 net feet of high-quality oil pay in Lower Tertiary reservoirs. The well was drilled to a total depth of 28,675ft in about 8,500ft of water in the Sigsbee Escarpment Block 39. We’re particularly eyeing the subsalt potential here, banking on Brazil’s success. Development of the Gulf of Mexico’s subsalt potential has been slow so far, largely because of the focus on onshore shale in the US, but we think that’s about to change. This auction is important because it could be the one that turns the Gulf of Mexico into the most active deep-water play in the world. The US government is playing around with the terms of new agreements, hoping that this time around whoever buys the blocks will actually develop them.




Oilprice - The No. 1 Source for Oil & Energy News