For first time since spill, BP asks permission for deep-water drilling

By Jennifer A. Dlouhy and Brett Clanton

BP is asking federal regulators to approve a blueprint for new deep-water drilling in the Gulf of Mexico for the first time since its Macondo well blew out, triggering the nation’s worst oil spill last year.

In a filing with the U.S. government made public this week, the British oil company seeks to expand on previously approved drilling plans at its Kaskida prospect about 220 miles off the Louisiana coast.

Federal regulators broadly signed off on BP’s plans to drill up to five wells at the site in 2008. In the new filing, BP is asking permission to drill two more wells at Kaskida and change the location of two others.

Even if the exploration plan is approved, BP still will have to get the government’s approval to drill individual wells at the site, with each vetted separately.

BP said its drilling plan embraces “enhanced performance standards” that go beyond federal requirements, including backup emergency equipment and engineer-witnessed testing of cement used at all of its deep-water wells.

In July, the company pledged to abide by those voluntary safeguards for its Gulf of Mexico drilling, in a bid to assure regulators and the public that it can resume safe offshore oil exploration and has learned the lessons of last year’s Deepwater Horizon disaster.

“BP has a long and successful history of safely operating in the Gulf of Mexico,” the company said in a statement. “BP remains committed to sharing lessons learned with government, industry and other stakeholders to help prevent future incidents of this nature and improve oil spill response capability in the future.”

Some Gulf Coast advocates and congressional Democrats called the filing premature.

Rep. Ed Markey, D-Mass., questioned why “BP is attempting to resume drilling in the Gulf even before comprehensive safety reforms have been implemented.”

Cynthia Sarthou, executive director of the Gulf Restoration Network, noted that the BP filed less than two weeks after federal investigators released their final conclusions about what triggered the 2010 oil spill. That report, released on Sept. 14, concluded that a series of failures — many of them in BP’s control — culminated in the lethal blowout of the Macondo well.

“BP has produced no evidence that it has changed its ways,” Sarthou added. “BP simply should not be allowed to further jeopardize the health of the Gulf of Mexico by pursuing yet more high-risk deep-water drilling.”

While BP has not drilled a new well since the Gulf disaster, several of its Gulf projects have been moving forward quietly. The Mad Dog South field, which BP operates with a 60.5 percent stake, recently was drilled by minority partner BHP Billiton Petroleum and proved to have a giant stash of oil. Last year, BP essentially transferred the operatorship of its Tubular Bells field to Hess Corp. in a $40 million deal that cut its stake in the field from 50 percent to 30 percent.

BP owns 100 percent of Kaskida after buying out Devon’s 30 percent stake in a sweeping $7 billion deal that included other assets in March 2010 — the month before the Macondo blowout.

Sean Shafer, a senior market analyst with Quest Offshore Resources in Sugar Land, estimated that 500 million to 800 million barrels of oil could be recovered from Kaskida using today’s technology, which would make it a “very major project” for the Gulf.

Such projects will be especially important to BP as it works to reestablish itself in the U.S. offshore region.

Even if BP resumed drilling at Kaskida today, the project likely would not begin producing oil until 2016 or 2017, given the infrastructure required to bring it online, Shafer added.

BP announced the discovery of its Kaskida field in August 2006 after drilling a six-mile deep well in an outer area of the U.S. Gulf known as Keathley Canyon and finding an 800-foot section of oily rock.

While the discovery was viewed as significant, it wasn’t until an appraisal well was drilled five miles to the west in 2009 that BP confirmed it was among its biggest finds ever in the U.S. offshore basin, holding as much as 3 billion barrels of oil.

At the time, BP was on a roll in the Gulf, having also just discovered a separate field called Tiber, which has been estimated at roughly the same size as Kaskida.

Both are in an ancient layer of rocks that geologists call the Lower Tertiary trend, where Chevron, Shell and others have also made major oil discoveries in recent years. They were seen as further evidence that the industry had discovered yet another new frontier for exploration in the Gulf of Mexico after decades of development.

But BP was forced to put its plans on hold in the wake of the Deepwater Horizon disaster.

BP’s newly proposed wells would be drilled in roughly 6,019 and 6,021 feet of water — about 1,020 feet deeper than Macondo.

In its filing, the company estimated that in case of an emergency, it would take 184 days to drill a relief well at the site. Other interventions — including a system for containing runaway underwater wells — also would be available.

The public can comment on BP’s plan through Oct. 2. The ocean energy bureau also has 30 days under federal law to finish an environmental analysis of BP’s proposal.

BP Kaskida Supplemental Exploration Plan