The Permian may be grabbing most of the energy headlines lately, but a noteworthy share of crude oil production growth the U.S. experiences over the next two or three years is sure to come from the Gulf of Mexico. There, far from the Delaware Basin land rush and the frenzy to build new Permian-to-wherever pipelines, a handful of deepwater production stalwarts are completing new wells — at relatively low cost — that connect to existing offshore platforms. Taken together, these projects are expected to increase the Gulf’s output by more than 300 Mb/d by the end of 2018. Today we look at the Gulf’s under-the-radar growth in oil output and the prospects for continued expansion there.
In 2016, U.S. crude oil production averaged 8.9 million barrels/day (MMb/d), according to the Energy Information Administration (EIA), with offshore production in the Gulf of Mexico (GOM) contributing 1.6 MMb/d—or 18.2%—of the total. On an annual basis, that is an all-time high record level of offshore Gulf production!
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