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Deepwater Gulf of Mexico - America's Expanding Frontier
SOURCE: U.S. Department of the Interior, Minerals Management Service, Gulf of Mexico OCS Region






RESERVE POTENTIAL

This report has examined the history of reserve growth in the GOM.

Figure 56 illustrates results of the latest drilling in the GOM, suggesting very significant production volumes in the near future.

Figure 56. BOE added (reserves, known resources, and industry-announced discoveries). (Click the image to enlarge)
Figure 56. BOE added (reserves, known resources, and industry-announced discoveries). (Click the image to enlarge)

Predicting future discoveries is more difficult.

To address the amount of hydrocarbons yet to be discovered in the GOM, this report will briefly examine one indicator — the “creaming curve” — and one detailed study — 2000 Assessment of Conventionally Recoverable Hydrocarbon Resources of the Gulf of Mexico and Atlantic Outer Continental Shelf as of January 1, 1999 (Lore et al., 2001), commonly known as the 2000 Assessment.

This modified creaming curve (only successful tests are plotted), figure 57, shows the discovered and implies the undiscovered hydrocarbon volumes in the GOM.

Figure 57. Modified creaming curve for shallow- and deepwater areas of the GOM
(includes reserves, resources, and industry-announced discoveries). (Click the image to enlarge)
Figure 57. Modified creaming curve for shallow- and deepwater areas of the GOM (includes reserves, resources, and industry-announced discoveries). (Click the image to enlarge)

The creaming curve plots “cumulative number of fields by discovery date” against “cumulative discovered hydrocarbon volumes.”

Many such curves demonstrate that the largest fields tend to be discovered early in the exploration cycle.

This phenomenon results in a curve having a steep slope during the early (immature) phase of exploration and becoming flatter in the mature phase of exploration, when smaller fields are generally discovered.

Figure 57 contains two creaming curves. The shallow-water GOM is characterized by a curve typical of a mature trend. The recent slope of the curve is very flat since, in general, smaller fields are being discovered.

Unless a dramatic new exploration play is recognized, only limited reserves will be added.

This prediction is supported by figures 51, 52, 53, and 56, all of which show a decline in field discovery size and added reserves from the shallow-water GOM over the last 20 years.

The deepwater creaming curve contains fewer field discoveries; however, these fields tend to be large, resulting in a curve with a steep slope. This slope indicates an area that is still in an immature exploration phase with many large fields awaiting discovery.

The limited number of discoveries, steep slope of the curve, and large amount of hydrocarbon volumes already discovered support this prediction.

A more quantitative and geologic-based estimate of future discoveries in the GOM is the 2000 Assessment (Lore et al., 2001), summarized in figure 58.

Figure 58. Reserves and future discovery volumes in the deepwater GOM. (Click the image to enlarge)
Figure 58. Reserves and future discovery volumes in the deepwater GOM. (Click the image to enlarge)

The deepwater is expected to have ultimate reserves of approximately 71 billion barrels of oil equivalent (BOE), of which 56.4 billion BOE remains to be discovered.1

Compare this with the shallow-water ultimate reserves of approximately 65 billion BOE, of which 15.2 billion BOE remain to be discovered.


1 The forecasts were based on the MMS report Atlas of Gulf of Mexico Gas and Oil Sands (Bascle, 2001). Each producing field and reservoir in the GOM was assigned to a hydrocarbon play. The 2000 Assessment (Lore et al., 2001) then forecast the number of hydrocarbons remaining to be discovered in the GOM on the following factors:
  • the number and size of discovered accumulations in an established play
  • an estimate of the number of undiscovered accumulations in a play
  • lognormal size distribution for these accumulations
The MMS then predicted the size of undiscovered accumulations in each play. Frontier or conceptual plays were modeled on similar but more mature plays. The undiscovered accumulations were then aggregated for all 92 plays in the 2000 Assessment. To compare reserve numbers from mature fields, recent field discoveries, and estimates from undiscovered fields, cumulative growth factors were used in the 2000 Assessment. It has been widely observed that a field’s size “grows” throughout its lifespan. Reasons for this growth vary widely, but may include areal extension of existing reservoirs, discovery of new reservoirs, improvement in production procedures, and the natural conservatism of early estimates. A detailed discussion of reserve appreciation and cumulative growth factors may be found starting on page 49 of the 2000 Assessment. The estimated ultimate recovery volumes were then used for the forecasts in the 2000 Assessment.



















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Cover and Title Page

PREFACE

INTRODUCTION

BACKGROUND

LEASING DRILLING AND DEVELOPMENT RESERVES AND PRODUCTION SUMMARY AND CONCLUSIONS . . . Feedback