BP starts pumping crude at major deep-water Gulf project

HOUSTON – BP said Monday it began pumping crude from a new well at one of its four major deep-water hubs in the Gulf of Mexico last week, the second major startup in U.S. offshore region this year.

Sitting in 6,300 feet of water about 140 miles southeast of New Orleans, the new well at the Na Kika semi-submersible platform is the third of six BP oil production projects slated to come online this year.

It’s part of a multibillion-dollar investment that could help lift Gulf to record production levels in two years.

By 2016, new projects could push the region’s daily oil production past its previous peak of 1.8 million barrels per day, according to research and consulting firm Wood Mackenzie.

The London-based oil company said it plans to bring a second well to production there by the end of June.

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The Na Kika first began harvesting oil in 2003, but BP has recently expanded its operations there by drilling two new wells and building subsea infrastructure to tie back to its production platform there.

The additions to the subsea platform could increase its daily production by 40,000 barrels of oil equivalent. In all eight of its separate fields, the Na Kika platform can produce 130,000 barrels per day.

BP also owns a stake in the first major upgrade in the Gulf this year, Royal Dutch Shell’s deep-water project in the Mars B field, where the Olympus platform started up earlier this month.

The company is trying to unload $40 billion over the next decade on its deep-water fields in the Gulf, even as it haggles with federal regulators for permission to bid on new oil leases. Oil wells in the Gulf give BP highly lucrative production, it said Monday.

It filed suit against the U.S. government last year over the Environmental Protection Agency’s decisions to suspend and disqualify it from bidding on new drilling leases and other federal contracts in the Gulf.

Those decisions “should be invalidated because they are arbitrary and capricious, contrary to the law, and an abuse of discretion,” BP spokesman Geoff Morrell said in an emailed statement.

But the Associated Press reported last week that BP America CEO John Minge said it is approaching a deal with regulators to permit it to add to its 650 leases in the offshore region again.

For now, it is concentrating its investment plan on its operations in the Thunder Horse, Atlantis, Mad Dog and Na Kika fields.

BP operates and owns a 50 percent stake in the Na Kika project. Royal Dutch Shell owns the other half.

Its shares inched up 1.5 percent to $50.53 on Monday during early trading hours New York Stock Exchange.


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