A new oil discovery in the Gulf of Mexico by a group of Dutch and British companies may be the largest U.S. find in 20 years and prove as dramatic as the Alaska discovery in the 1970s, an industry publication reported Friday.
"Some think the total could go well over 2 billion barrels . . . may well be the largest U.S. discovery in 20 years," the authoritative Petroleum Intelligence Weekly reported in its current edition.The discovery provides the first sign that deep waters in the gulf "will offer a reprieve for the ailing U.S. oil industry as dramatic as Alaska proved to be in the 1970s."
PIW editor Sarah Miller said the 2 billion barrel "realistic" estimate was based on the assessment of geologists who had examined the drilling logs filed with the state of Louisiana.
The so-called Mars field 600 miles off the coast is 67 percent owned by Shell, which has joint headquarters in London and The Hague, the Netherlands, and 33 percent by London-based British Petroleum Co.
A Shell spokesman said, "The Shell company does not agree with PIW," and referred to a statement issued Wednesday by the company.
In the release, Shell President Frank Richardson said, "Our Mars discovery is potentially large and could surpass in estimated volumes our Auger deepwater discovery announced in 1989."
He said the nearby Auger field had a potential recovery of more than 220 million barrels of oil and barrel-equivalents of natural gas.
"Shell is playing it down," said PIW's Miller.
Alaska's reserves of nearly 10 billion barrels discovered in the late 1960s are mostly concentrated in Prudhoe Bay, while those of the gulf appear to be in a "string" of oil fields much like those of the North Sea, Miller said.
"It's a string that might have a total as big or bigger than Alaska, " she said in a telephone interview.
PIW said the discovery could ease some of the pressure to extend oil exploration into environmentally sensitive areas such as the Alaska National Wildlife Reserve, bitterly opposed by environmentalists.
By the number of acres they have in the gulf's deep waters of 3,000 feet or more, Miller ranked oil companies as follows: Shell, Exxon Corp., BP, Chevron Corp., San Francisco and the Conoco subsidiary of du Pont in Houston.
Texaco Inc. of White Plains, N.Y., Mobil Corp. of Fairfax, Va., Amerada Hess Corp. of New York and Marathon Oil Co., the USX Corp. unit based in Findlay, Ohio, have a smaller presence in the field.
Successful drilling for oil at depths in excess of 3,000 feet of water has been made possible by a new technology using "tension legs" to allow drilling platforms to stay in place with flexibility, Miller said.
Until recently, platforms either floated or were held rigidly in place, she said.
Analyst predicts world oil prices will rise\ Political and economic turmoil in the Soviet Union, which has resulted in declining oil production and exports, could soon increase the upward pressure on world oil prices, an energy analyst said Friday.
Daniel Yergin, in a speech prepared for delivery at an energy symposium in Zurich, Switzerland, also said the continuing need of the United States for oil imports because of declining production from aging U.S. oil fields requires the consideration of a world energy policy.