Oil drilling in Gulf of Mexico resumes to near-normal levels, driven by huge deepwater finds that are riskier due to depth, pressure; federal regulators reviewing Deepwater Horizon disaster call for changes to offshore drilling oversight

LOS ANGELES , September 15, 2011 () – Massive discoveries in the Gulf of Mexico are prompting the return of offshore oil drilling to near normal levels, but the work is more complex and federal regulators are calling for closer oversight, reported The Wall Street Journal on Sept. 15.

Numerous changes in offshore drilling oversight were recommended by the U.S. Bureau of Ocean Energy Management Regulation and Enforcement in a report released on Wednesday. Among these are more surprise visits to drilling-rig engine rooms and stricter rules on disclosing incidents in which drillers nearly lost control.

The regulators are investigating BP PLC's Deepwater Horizon disaster that occurred in the Gulf last year.

The new oil fields being discovered in the Gulf are buried deeper, in highly-pressurized rock that will require more careful monitoring of drilling operations. These recent discoveries are also close to the edge of U.S. territorial waters, the Journal reported.

Currently, there are 23 oil rigs drilling in the Gulf for oil that is in waters more than 3,000 feet deep. This is the same number of rigs as in 2009, according to federal data.

With the recent discoveries, there are at least four oil fields in the Gulf with one billion barrels of recoverable oil. This compares with just one dozen such finds made in the U.S. during the past century.

These finds, which were announced by Chevron Corp. and BHP Billiton PLC last week and by Exxon Mobile Corp. more recently, could each add 100,000 to 200,000 barrels of oil per day to production, said Phil Weiss, an analyst for Argus Research, reported the Journal.

The high price of oil, as well as improved technologies, are pushing the discoveries. Geologists can remotely detect oil before drilling, said Bobby Ryan, VP of global exploration for Chevron, noting “we see opportunities in areas where we thought there weren’t any more.”

The industry is increasingly moving to more risky exploration, said Tadeusz Patzek, chairman of the Petroleum and Geosystems Engineering Dept. at the University of Texas in Austin. It’s likely that companies have been aware of these fields since the 1980s, but had not attempted to drill them until recently, he said.

An estimated 1.43 million barrels/day of oil will be produced from the Gulf’s federal waters in 2011, 13.5% less than was expected before the Deepwater Horizon oil spill last year, according to projections from the U.S. Energy Information Administration, the Journal reported.

The primary source of this article is The Wall Street Journal, New York, New York, on Sept. 15, 2011.

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