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Chevron, BP and ConocoPhillips partner to explore 24 leases in Paleogene trend in deepwater Gulf of Mexico

Chevron Corporation’s subsidiary, Chevron USA will now work with BP Exploration and Production Inc. (BP) and ConocoPhillips Company (COP) to explore and to appraise jointly-held offshore leases in the emerging Paleogene trend in the deepwater Gulf of Mexico.

The transaction encompasses BP’s recent Tiber and Gila discoveries, and the Gibson exploratory prospect. Chevron has acquired an interest in Tiber and Gila from BP. Chevron, BP and ConocoPhillips already held interests in the Gibson prospect. The scope of the collaboration between Chevron, BP and ConocoPhillips includes further exploration and appraisal of these leases as well as evaluating the potential of a centralized production facility, which would provide improved capital efficiency, similar to Chevron’s Jack/St. Malo project.

Chevron will operate Tiber, Gila and Gibson, building on its recent success in starting up the Jack/St. Malo oil production platform in the Paleogene/Lower Tertiary on time and on budget. Operatorship is expected to be transferred after BP finishes drilling appraisal wells at Gila and Tiber.

Completing these agreements will enable BP to do three things that are at the core of our strategy in the deepwater Gulf of Mexico. It will support continued exploration and development in the Paleogene, which we expect to be a key part of our future in the region. It will allow us to manage and maintain capital discipline by sharing development costs. And transferring operatorship of these assets to Chevron will allow BP to increase our focus on maximizing production at our four existing producing hubs in the Gulf, each of which is still in the early stages of development.

—Richard Morrison, president of BP’s Gulf of Mexico business

The recently-announced discovery at Guadalupe, located adjacent to Keathley Canyon (earlier post), could also be developed by utilizing the centralized production facility. Chevron, BP, and Venari, the Guadalupe co-owners, will evaluate this possibility during the upcoming appraisal phase of that discovery.

Chevron-gulf-of-mexico-expansion-434x286-a
Chevron, BP and ConocoPhillips plan to work together in the northwest portion of Keathley Canyon in the US deepwater Gulf of Mexico.

BP discovered Tiber in 2009 and Gila in 2013, and in October 2014 participated as a co-owner in the Chevron-operated Guadalupe discovery.

  • The Gila discovery was made by an exploration well on Keathley Canyon Block 93, about 300 miles (483 km) southwest of New Orleans, in approximately 4,900 feet (1,494 meters) of water. The Gila discovery is located approximately 25 miles (40 km) west of Tiber, also located in the Keathley Canyon area.

  • The Tiber discovery well, located in Keathley Canyon block 102, approximately 250 miles (400 km) south east of Houston, is in 4,132 feet (1,259 meters) of water. The Tiber well was drilled to a total depth of approximately 35,055 feet (10,685 meters) making it one of the deepest wells ever drilled by the oil and gas industry.

  • The Guadalupe discovery well in Keathley Canyon Block 10 is located approximately 180 miles (290 km) off the Louisiana coast in 3,992 feet (1,217 meters) of water and was drilled to a depth of 30,173 feet (9,197 meters).

BP believes that development of portions of the Paleogene trend will require next-generation tools and systems for operating in high-pressure, high-temperature reservoirs. BP continues to pursue development of these technologies through its Project 20KTM initiative, announced in 2012, and will work with co-owners to continue this progress.

Chevron, BP and ConocoPhillips also plan to work together to achieve efficiencies in schedule, realize cost savings, and optimize the use of human resources.

Chevron has a proven track record for delivering superior results in complex deepwater developments. We will work with our co-owners to evaluate how to develop these leases, along with our recently announced discovery at Guadalupe.

—Jay Johnson, senior vice president, Upstream, Chevron Corporation

Ownership percentages
Asset Chevron BP COP Petrobras Venari
Tiber 31% 31% 18% 20%
Gila 36% 34% 30%
Gibson 36% 34% 30%
Guadalupe 42.5% 42.5% 15%

Comments

gorr

Nice, now there are no reason to get an even lower price for gasoline even lower than the actual price. Also begin to produce solar synthetic gasoline and gasoline made with green algae farming at cheaper price. Cut the gas tax to stimulate the economy but do not buy big suv, this will push gas price toward 0 cents a gallon to even stimulate more the economy. We need Venezuela gas price here in north-America.

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