BP Discovers ‘Giant’ Oil Field in Gulf of Mexico

From The New York Times:

LONDON (Reuters) — The British energy giant, BP, said Wednesday that it had made a “giant” oil discovery in the Gulf of Mexico, reaffirming the area’s importance to Western oil majors who are increasingly barred from investing in the world’s richest oil prospects.

BP said in a statementon Wednesday that it had made the find at its Tiber Prospect in the deep water Gulf of Mexico. The well was drilled in Keathley Canyon block 102.

Further appraisal will be required to ascertain the volumes of oil present, BP said, but a spokesman said the find could be bigger than its Kaskida discovery which has more than 3 billion barrels of oil.

BP, the biggest oil producer in the United States and biggest leaseholder in the Gulf of Mexico, has a 62 percent working interest in the block while Brazilian state-controlled Petrobras owns 20 percent and the American oil giant, ConocoPhillips, owns 18 percent.

“These material discoveries together with our industry leading acreage position support the continuing growth of our deepwater Gulf of Mexico business into the second half of the next decade,” said Andy Inglis, BP’s head of Exploration and Production.

The find highlights the potential in the Gulf of Mexico and bodes well for other exploration in the area, including at Royal Dutch Shell’s Great White field, Jason Kenny, oil analyst at ING in Edinburgh, said.

The Gulf of Mexico has become increasingly important to Western oil majors as oil rich-countries like Saudi Arabia, Venezuela and Russia reserve their richest fields to be developed by their state-owned oil companies.

The Gulf of Mexico is especially attractive because it offers high profit margins, because of relatively low taxation compared with countries like Russia and Nigeria, and because of the low political risk.

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