Companies in the Gulf are catching a new wave

A popular topic of discussion at the 2008 Offshore Technology Conference at Houston was the Lower Tertiary ultra-deepwater trend in the Gulf of Mexico.

Executives from Shell, Chevron, BP, Anadarko and Devon Energy spoke of the Lower Tertiary as the "new wave" in the Gulf of Mexico, an area with great potential but equally great challenges that could extend the life of the Gulf of Mexico offshore industry, much like the move from drilling on the Shelf to deepwater did. The Lower Tertiary trend includes recent discoveries and projects such as Kaskida, Cascade, Chinook, Perdido, St. Malo and Jack. While operators estimate large reserves at these fields, many of the executives talked about specific difficulties associated with the area. Russ Ford, technical vice president for Shell E&P in the Americas, mentioned the viscous oil and low energy reservoirs of the trend as particular problems, but said Shell looks forward to the challenge. Shell's Perdido project, in 8,000 feet (2,438 m) of water, will feature subsea boosting and expandable casing to exploit resources there. Executives from Devon and Chevron both talked about the Jack and St. Malo discoveries as part of the Lower tertiary wave. Located around 30 miles (48 km)apart in Walker Ridge Blocks 678 and 758, the companies will face the challenge of a lack of infrastructure in the area by developing the two discoveries from a single production platform. Brian Smith, general manager of major capital projects for Chevron, said that the discoveries could come on the front end engineering and design phase by early 2009. Transocean is building two new drillships for Chevron to use on the project.

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