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Devon Energy launches drilling on Tuscany prospect Newfield Exploration, Kerr-McGee latest to apply for permits in Eastern Gulf Petroleum News
Devon Energy has become the latest company to spud a deepwater exploration well in the Eastern Gulf of Mexico, while fellow independents Newfield Exploration and Kerr-McGee have joined a growing list of companies to file for drilling permits in the remote region.
Just how many wells are drilled and discoveries or dry holes disclosed and new seismic shot prior to the tentatively scheduled Dec. 10 Eastern Gulf lease sale likely would influence bidding patterns. Results from as many as a dozen exploration wells stretched across the sale area could be known prior to the Sale 189.
However, drilling results thus far have been spotty since the Eastern Gulf was re-opened to leasing in late 2001. Anadarko Petroleum has announced discoveries at its Jubilee and Atlas prospect and a dry hole at Hawkeye, and Marathon Oil came up dry at Barracuda. Anadarko's discoveries — one small and the other undisclosed — are believed to be strictly natural gas. Drilling under way at Tuscany Drilling at the Tuscany prospect began the week of Aug. 24, a spokeswoman for partner EOG Resources confirmed recently, adding that it would take 30 to 40 days to complete the well. Located on DeSoto blocks 180 and 224, the prospect could hold an estimated 215 million barrels of oil equivalent, she said. Devon Energy owns 62.5 percent of Tuscany and serves as operator. EOG holds a 37.5 percent interest in the prospect.
Meanwhile, Kerr-McGee and Newfield have become the latest explorers to file for permits, bringing to seven the number of companies that so far have applied for or received government permission to drill on their leases in the Eastern Gulf, according to information furnished by the U.S. Minerals Management Service.
Newfield actually farmed in to Murphy Oil leases acquired in an Eastern Gulf sale held more than a decade prior to the 2001 offering. However, located on DeSoto Canyon blocks 47 and 48, Newfield's Dalmatian prospect is just three miles removed from the northern boundary of up-coming Eastern Gulf Lease Sale 189.
Newfield intends to spud Dalmatian late in the 2003 fourth quarter or early in the 2004 first quarter, a spokesman for the company said. He said Dalmatian is a "significant prospect" with more than 100 billion cubic feet of reserve potential. Newfield holds a 37.5 percent interest in the prospect and serves as operator. Murphy retained a 62.5 percent interest and would operate the development phase in the event of a commercial discovery, Newfield said. Up to five wells at Kish prospect Less is known about Kerr-McGee's Kish prospect, located on DeSoto Canyon blocks 226 and 270. A spokeswoman for the company said Kerr-McGee would operate an initial exploration well in a 50-50 partnership with Marathon Oil. However, she said the partners had not established a spud date and she was unwilling to provide reserve estimates. Kerr-McGee's permit application calls for up to five wells, according to MMS.
The list of permit applicants includes Shell for its Red Dawg prospect at DeSoto Canyon blocks 622 and 666, Shiloh at DeSoto Canyon Block 269, and an unnamed prospect at Lloyd Ridge 399. Others include Dominion E&P for its Amazon prospect at DeSoto Canyon Block 620, and Marathon for its Raptor and West Raptor prospects at DeSoto Canyon blocks 490, 491, 535, 445 and 489.
Anadarko also has permitted its Spiderman prospect at DeSoto Canyon Block 621. Spiderman is located next door to Dominion's Amazon prospect on Block 620. Spiderman and Amazon are said to be in the same prospect and could be drilled under a Dominion-Anadarko partnership later this year.
Anadarko, currently the most active explorer in the Eastern Gulf, also has applied for a permit to drill Jubilee East on Lloyd Ridge blocks 265 and 309, according to MMS. The prospect is located adjacent to the company's announced Jubilee discovery on Atwater Valley Block 349, just outside the Eastern Gulf sale boundary.
Jubilee contains announced reserves of 40 to 50 million barrels of oil equivalent, but Anadarko has said that is not enough volume for a stand-alone commercial project in the ultra-deep waters of the Gulf. "We need to delineate Jubilee, which we hope to do later this year," Robert Allison, Anadarko's chief executive officer, said in the company's 2003 second-quarter conference call.
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