Gulf of Mexico costs hit record levels
The Gulf of Mexico region is often characterized as a high cost market. A recent survey of major US operators conducted by the EIA supports this characterization. According to survey results, exploration and development expenditures (excluding unproved and proved property acquisition) in the US offshore region increased 39% from 2005 to about $13 billion in 2006, the highest level since 1982. Finding costs increased to record levels from $8.12/boe in the period from 1999-2001 to $63.71/boe in the period from 2004-2006, and lifting costs increased 11.7% from $6.56/boe in 2005 to $7.32/boe in 2006. Meanwhile, average reserve additions for the period from 2004-2006 fell 82% lower than the three-year average reserve additions in the period from 1999-2001.
Independence Hub, one of two major deepwater GoM floating production systems that recorded first production in 2007.
Read more about the latest trends in the Gulf of Mexico, beginning on pg. 30.
