R&D/innovation

US Agencies Advance Research To Increase Gulf of Mexico Production

The research will focus on potential policy changes that could help increase oil and gas production from deepwater infrastructure already in place in the Gulf of Mexico to reduce stranded assets.

Long distance photo of platform in the Gulf of Mexico
Getty Images

The US Bureau of Ocean Energy Management (BOEM) and Bureau of Safety and Environmental Enforcement (BSEE) have announced they are collaborating to advance new research into whether certain policy changes could help increase oil and gas production from deepwater infrastructure already in place in the Gulf of Mexico (GOM). The study will examine specific economic parameters used by BOEM and BSEE for new and high-cost technologies such as extended-reach subsea tiebacks that, if implemented, could minimize stranded hydrocarbon resources. This research would apply to developments that might connect to deepwater facilities that have additional production capacity.

Deepwater production, which comes from depths greater than 656 ft, accounts for 92% of total GOM offshore oil production, and 14% of all domestic oil produced in the US, according to the agencies. In 2019, facilities in deepwater GOM averaged 1.7 million BOPD.

According to a US Department of the Interior news announcement, four out of five deepwater facilities are now producing less than 50% of their daily oil production capacity, based on a 3-year average of daily production rates. Through collaboration, BOEM and BSEE identified contingent resources 30–60 miles from existing facilities. Their research, they said, will identify any difficulties that new technological advances may face that could potentially hinder production and project economics.

Under the Outer Continental Shelf (OCS) Lands Act, the Department of the Interior must regulate in the interest of conservation of OCS natural resources while ensuring receipt of fair market value. BSEE is obligated under its regulations to consider actions that would further the goal of conserving remaining GOM deepwater hydrocarbon resources. Under a longstanding agreement, BOEM’s Economics Division conducts economic, statistical, engineering, and cost-benefit analyses to evaluate policies for offshore energy and minerals programs and works to ensure receipt of fair market value for the rights to produce offshore energy and mineral resources. Tying additional oil and gas production to a facility with existing capacity could ultimately result in more efficient development of natural resources, according to the news announcement.

Once the evaluation is completed, it will be posted on the BOEM and BSEE websites along with any next steps.