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Anadarko positions itself for Eastern Gulf exploration Company's plan appears most aggressive, with 36 wells proposed for Hawkeye and Atlas prospects; company bid $48.5 million for eight blocks Petroleum News Alaska Houston Office
North Slope producer Anadarko Petroleum Corp., a relative newcomer to deepwater Gulf of Mexico, is among a handful of companies positioning itself for an exploration assault on the Eastern Gulf, one of last remaining deepwater frontiers in the vast region.
In fact, of the four companies that so far have filed exploration plans for the Eastern Gulf, Anadarko's plan appears to be the most aggressive, with up to 36 wells planned for prospects Hawkeye and Atlas, according to records provided by the U.S. Minerals Management Service.
It's unlikely Anadarko would drill 36 wells during the exploration phase, but company plans for the region further demonstrate Anadarko's serious interest in the largely unexplored Eastern Gulf.
In the December 2001 Eastern Gulf lease sale, the first for the area in 13 years, Anadarko shelled out a rich $48.5 million in winning bids for the eight blocks that now make up the Hawkeye and Atlas prospects. That included $18.3 million for Lloyd Ridge 316, among the highest bids for a single block in the entire sale.
Company awaiting permits Anadarko said it is waiting for government permits, but hopes to begin drilling either Hawkeye or Atlas during the first half of 2003. The company decline to provide pre-drill reserve estimates for the two prospects, which are 100 percent owned by Anadarko.
Other companies that have so far submitted exploration plans for the Eastern Gulf are Shell, Marathon Oil and Ocean Energy. Marathon actually has commenced drilling its Barracuda prospect, held 50-50 by Marathon and Oklahoma-based independent Kerr-McGee.
Meanwhile, Anadarko said it is seeking partners to share drilling expenses for four deepwater prospects — Storm Warning, Gauntlet, Blues Image and Shark Attack — located in more traditional areas of the Gulf outside of the Eastern Gulf Lease Sale 181 area.
Anadarko said that Blues Ridge, with estimated reserves of 500 million to over 1 billion barrels of oil equivalent, is situated in the same middle and lower Miocene intervals found at BP's huge 1.5 billion barrel Thunder Horse discovery in Mississippi Canyon. Anadarko said Blues Ridge is located in Mississippi Canyon, but for competitive reasons would not provide a specific block location.
Storm Warning and its estimated 100 to 300 million barrels of oil equivalent also are located in Mississippi Canyon, but again Anadarko declined to say exactly where. It was the same story for Gauntlet and its potential 500 million barrels of oil equivalent and for Shark Attack and its pre-drill estimate of 100 million barrels of oil equivalent.
Ten Gulf exploration wells this year Anadarko has set aside about $460 million of its $2.3 billion capital budget in 2003 for projects in the Gulf of Mexico, including $363 million for development and $98 million for exploration. That's more than twice what the company spent on development in 2002 and considerably less than what it invested in exploration. However, Anadarko said the exploration budget will be more heavily focused on drilling this year.
Anadarko said it plans to drill 10 Gulf exploration wells this year, five of them in the deepwater. First on the agenda is the Jubilee prospect, located on the border separating the Central and Eastern Gulf. After Jubilee, the rig likely would be moved to either Hawkeye or Atlas in the Eastern Gulf, the company said.
Six deepwater development wells are planned around Anadarko's Marco Polo and K2 discoveries. First production from Marco Polo, the company's first deepwater discovery, is expected in early 2004. The field in located in 4,300 feet of water. In just a few years, Anadarko has managed to accumulate interests in some 180 deepwater blocks in the Gulf.
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