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The Gulf of Mexico (GOM) may account for less than one-fifth of U.S. oil production but it’s a region that’s more than holding its own. Producers plan to expand output, using advanced technologies to tap untouched reserves in deeper waters. Still, Gulf Coast output has always been at risk from severe storms, just like the onshore infrastructure on which producers depend.
As most in the industry know well, GOM production has been around much longer than the tight-oil plays that drive most of today’s growth. Since the 1980s, Gulf production has nearly tripled to almost 2 MMb/d but its share of U.S. oil production has shrunk to 14%, about half of what it was in the early 2000s. In contrast, tight-oil production now accounts for roughly two-thirds of total U.S. output, which set an annual record last year at nearly 13 MMb/d. The extraordinary growth in tight-oil supply continues to overshadow the Gulf, or any other domestic source.
GOM crude oil production is set to grow through the 2020s, due in part to the new technologies making output in some deepwater areas technically and financially feasible. But production in the GOM always carries some weather-related risk, with hurricanes impacting everything from offshore platforms and production to onshore assets like refineries and pipelines.
Key takeaways from the report include:
- Gulf of Mexico crude oil output to top 2 MMb/d by 2030
- Anchor project shows promise of deepwater technology
- Hurricanes can shut in millions of barrels from Gulf platforms
- Storm damage, power outages biggest risks to onshore assets
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