• 4 minutes Tariffs to derail $83.7 Billion Chinese Investment in West Virginia
  • 9 minutes Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 17 minutes Kaplan Says Rising Oil Prices Won't Hurt US Economy
  • 6 hours Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 3 hours Saudi Arabia plans to physically cut off Qatar by moat, nuclear waste and military base
  • 21 hours Corruption On The Top: Netanyahu's Wife Charged With Misuse of Public Funds for Meals
  • 7 hours Why is permian oil "locked in" when refineries abound?
  • 41 mins Saudi Arabia turns to solar
  • 15 hours Russia's Energy Minister says Oil Prices Balanced at $75, so Wants to Increase OPEC + Russia Oil by 1.5 mbpd
  • 3 hours Could Venezuela become a net oil importer?
  • 10 hours Teapots Cut U.S. Oil Shipments
  • 10 hours Oil prices going down
  • 11 hours Hot line, Macron: Phone Calls With Trump Are Like Sausages Best Not To Know What Is Inside
  • 1 day What If Canada Had Wind and Not Oilsands?
  • 1 day "The Gasoline Car Is a Car With a Future"
  • 23 hours U.S. Withdraws From U.N. Human Rights Council
  • 20 hours EU Confirms Trade Retaliation Measures vs. U.S. To Take Effect on June 22
  • 11 hours Putin Says 'Fierce' U.S. Politics Hindering Summit With Trump
  • 2 mins EVs Could Help Coal Demand
Uncertainty Looms Large Over Latin American Oil

Uncertainty Looms Large Over Latin American Oil

While Venezuela is grabbing a…

Oil Markets Turn Bearish Ahead Of OPEC Meeting

Oil Markets Turn Bearish Ahead Of OPEC Meeting

Oil prices fell on Tuesday…

BHP Billiton Greenlights $2.2B Investment In Deepwater Gulf Of Mexico

Offshore Drilling

BHP Billiton said on Thursday that it had approved spending US$2.2 billion of its share of development of BP-operated Mad Dog Phase 2 deepwater project in the Gulf of Mexico, which would mark the UK oil supermajor’s first new project in the area since the Deepwater Horizon disaster.

BHP Billiton holds a 23.9-percent participating interest in the Mad Dog field. The operator BP owns a 60.5-percent participating interest, and an affiliate of Chevron U.S.A. Inc. - Union Oil Company of California - holds the other 15.6 percent participating interest in the project.

In December last year, BP sanctioned the US$9-billion project, which will include a new floating production platform with the capacity to produce up to 140,000 gross barrels of crude oil per day from up to 14 production wells. Oil production is expected to begin in late 2021.

BP has been re-evaluating the project since 2013 after an initial design turned out to be too complex and expensive. BP, the co-owners and contractors have reduced the overall project cost by around 60 percent, to US$9 billion.

BP’s investment decision late last year and BHP Billiton’s joining in today with an investment pledge show that deepwater is not doomed.

At an industry event in October last year, BP’s CEO Bob Dudley was more optimistic about deepwater drilling than his colleagues’ oil executives.

Related: Permian Drilling Costs Surge: Are The Days Of Cheap Oilfield Services Over?

In BP’s statement on sanctioning Mad Dog 2, Dudley said:

This announcement shows that big deepwater projects can still be economic in a low price environment in the U.S. if they are designed in a smart and cost-effective way.

Steve Pastor, BHP Billiton President Operations Petroleum, said today that the project is part of his group’s strategic objective to build a conventional portfolio through the development of large, long-life, high-quality resources.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

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