U.S. Department of the Interior Minerals Management Service Gulf of Mexico OCS Region

Led by over 10 new deepwater discoveries and 4 major projects, the deepwater Gulf of Mexico area continued as one of the world's hottest exploration and production regions in 1997.

"The focus of activity in the deepwater Gulf of Mexico in 1997 was truly exciting," said Regional Director Chris Oynes in an end of the year assessment.  The Gulf of Mexico reached an all-time high in October and November of 1997 with 31 (temporary and permanent) rigs drilling for natural gas and oil in waters deeper than 1,000 feet, up from 26 in 1996.  In addition, over 10 deepwater discoveries were announced in 1997.  A record eight are projected to come online in 1998.  In total, a peak number of 17 deepwater fields were in production for the period January through July 1997 in waters 1,000 feet and greater.  "The deepwater Gulf of Mexico is truly America's New Frontier of energy production," said Mr. Oynes.

The four deepwater projects that began production set these world or Gulf of Mexico records in 1997:

• In May 1997, Shell Deepwater installed a tension leg platform (TLP) in 3,214 feet of water at its Ram-Powell project (Viosca Knoll Block 956), surpassing the 1996 record set by Shell's Mars TLP in 2,860-foot waters.

• Shell Offshore began natural gas production at a world record water depth of 5,376 feet from its Mensa subsea project (Mississippi Canyon Block 687) in June 1997. Although it still holds as a Gulf water depth production record, the world record has since been established by Petrobras in the Campos Basin off Brazil in 5,600 feet of water, using a subsea well completion.

• Shell's Mensa subsea tie-back set a world record when a 12-inch flowline was tied back 63 miles to an existing shallow-water platform. British Petroleum Exploration's 15-mile-long flow line from a Troika well is the Gulf's second longest tie-back record.

• Oryx and CNG began production in 1997 from the world's first production spar platform at its Neptune project (Viosca Knoll Block 826) in 1,930-foot waters.

• In November 1997, BP's Troika project on Green Canyon Block 244 in 2,684 feet surpassed the single well flow-rate when Troika's first well produced 27,000 barrels of oil per day. The same Troika well produced 31,000 barrels of oil on January 4, 1998, eclipsing the previous Gulf record of 20,500 barrels set by an Auger project well.

For the period January through July 1997, deepwater production from the Gulf accounted for approximately 24% (53.9 million barrels of oil) and 6% (174.5 billion cubic feet of natural gas) of all Gulf OCS production.  Attached is a listing of the 15 new deepwater discoveries made in the Gulf in 1997.

Two 1997 MMS publications, Deepwater in the Gulf of Mexico: America's New Frontier and Gulf of Mexico Outer Continental Shelf Daily Oil and Gas Production Rate Projections From 1996 Through 2000, have been updated and are available on our Homepage and through our Public Information Office at 1 (800) 200-GULF.  These publications provide more in-depth information on Gulf deepwater leasing, exploration, and production.

The MMS is the Federal Agency that manages and regulates the Nation's natural gas, oil, and other mineral resources on the OCS, and collects, accounts for, and disburses about $6 billion yearly in revenues from offshore Federal mineral leases and from onshore mineral leases on Federal and Indian lands.