OFFSHORE OIL DRILLING MOVING INTO DEEPER WATERS
Offshore drilling for oil and gas will
be moving into deeper and deeper waters, according to Ronald L.
Geer, a consultant with Shell Oil Co. and president of the
Marine Technology Society.
     Geer told a press conference at the Offshore Technology
Conference that the technology existed to drill exploratory
wells in up to 10,000 feet of water.
     But he added that as the industry moves more and more to
floating systems as opposed to fixed bottom supported
structures, the financial risks involved were greater.
     He said such projects involved six to nine year time
frames, and there was a "reluctance for people to stick their
necks too far out."
     Shell holds the world record for the deepest exploratory
well, at 6,900 feet, in the Wilmington Canyon in the Atlantic
offshore New Jersey in 1984.
     The company is currently drilling a 6,700 foot well in the
Atwater Valley in the Gulf of Mexico offshore Louisiana.
     Meanwhile, Brazil's Petrobras set a world record for
underwater production when they brought a well in 1,350 feet of
water offshore Rio de Janeiro state into production in January.
     Geer said the industry was particularly interested in the
Green Canyon field offshore Louisiana where a number of
companies, including Shell, a unit of Royal Dutch/Shell <RD>,
Dupont Co's <DD> Conoco Inc, USX Corp's <X> Marathon Oil Co,
Standard Oil Co <SRD> and <Placid Oil Co>, are working, many of
them testing new deep-water technologies.
     Of particular interest is the controversial Penrod-72
system being operated by the Dallas-based Hunt brothers who
last year placed Placid Oil under bankruptcy court protection
in order to avoid foreclosures on its valuable oil properties.
     They have been seeking the right to use assets to drill
oil wells in the Green Canyon through Penrod, arguing that
continued development of the project is essential to their
ability to get out of their financial crisis.
     Earlier this month, the Hunts were granted permission by a
bankruptcy court to pursue the Green Canyon project.
     The Penrod system involves a controversial floating
production platform with well heads sitting 1,350 feet down on
the ocean floor. Some 24 wells will be attached to the
wellhead, with one satellite well sitting in a record 1,700
feet of water.
     Geer said he could not comment on the Penrod project,
other than to note that it involves so many new technologies,
it might have a problem fitting all the pieces together within
a specific time frame.
     He also said he believed the potential production from the
project could be in line with what the Hunt Brothers have
projected
.
     The Hunts' creditor banks have contended the Hunts have
exaggerated the potential of the project.
     "They're in the ballpark," he said, of the numbers, adding
that he did not have enough information to comment further.
 Reuter
