Offshore oil and gas in the US Gulf of Mexico is a major source of oil and natural gas in the United States. The western and central Gulf of Mexico, which includes offshore Texas, Louisiana, Mississippi, and Alabama, is one of the major petroleum-producing areas of the United States. In 2007, federal leases in the western and central Gulf of Mexico produced 25% of the nation's oil and 14% of the nation's natural gas.[1]
Major fields include Eugene Island block 330 oil field, Atlantis Oil Field, and the Tiber oilfield (discovered 2009). Notable oil platforms include Baldpate, Bullwinkle, Mad Dog, Magnolia, Mars, Petronius, and Thunder Horse. Notable individual wells include Jack 2 and Knotty Head.
As technology has progressed over the years, oil companies have extended drilling and production farther and farther from shore, and into deeper and deeper waters. Production from water depths greater than 1,000 feet (300 m) began in 1979; currently, 72% of oil production in federal waters of the Gulf of Mexico comes from wells drilled in water depths of 1,000 feet (300 m) or greater.[2] Sixty-five discoveries have been made in water depths greater than 5,000 feet (1,500 m). The deepest water depth in which a discovery has been made is 9,975 feet (3,040 m).[3]
The federal government has not allowed drilling in federal waters in the eastern Gulf of Mexico, which includes offshore Florida and part of offshore Alabama, since 1995. In March 2010, US President Barack Obama announced plans to allow drilling in the eastern Gulf, in federal waters greater than 125 miles (201 km) from the coasts of Alabama and Florida.[4] The Obama administration reversed its plans to open the eastern Gulf after the Macondo blow out later that year.
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In 2008, federal leases in the Gulf of Mexico produced 418 million barrels (66.5×106 m3) of oil, down from 568 million barrels (90.3×106 m3) in 2002; however, due to new deep-water discoveries, the US Bureau of Ocean Energy Management, Regulation and Enforcement projects that oil production from the Gulf of Mexico will increase to 686 million barrels (109.1×106 m3) per year by 2013.[5]
The state of Louisiana issued its first offshore oil and gas lease in 1936, and the following year the Pure Oil Company discovered the first Louisiana offshore oil field, the Creole Field, 1.2 miles (1.9 km) from the shore of Cameron Parish, from a platform built on timber pilings in 10-to-15-foot-deep (3.0 to 4.6 m) water.[6][7]
The first offshore well in Texas was drilled in 1938, but the first oil discovery was not made until 1941, off of Jefferson County.[8] Through 2007, Texas state waters have produced 39 million barrels (6.2×106 m3) of oil and 4.0 trillion cubic feet (110 km3). In 2007, Texas state waters produced 600,000 barrels (95,000 m3) of oil and condensate and 26 billion cubic feet (0.74 km3) gas.[9][10]
The first oil test in offshore Alabama was made in Mobile Bay in 1951. The first discovery in state waters of offshore Alabama was made in 1979. By 2005 a total of 80 wells have been drilled in state water, and production in Alabama state water provided 154 billion cubic feet (4.4 km3) per year, half the state's gas production.[11]
The eastern Gulf of Mexico, which includes offshore Gulf Coast Florida, has never been a petroleum-producing area. From the 1950s to the 1990s, oil companies drilled exploratory wells off the Gulf Coast of Florida.[12] Nineteen wells were drilled in state waters, and forty were drilled in federal waters.
Gulf Oil drilled the first offshore Florida oil exploration wells in 1947, in state waters in Florida Bay south of Cape Sable, Monroe County.[13] In 1956 Humble Oil drilled an exploratory well in state waters of Pensacola Bay, Santa Rosa County.[14] In 1959 Gulf Oil drilled the first offshore Florida well drilled from an offshore platform, off the Florida Keys.[15] All the wells drilled in state waters were dry holes.
The first federal lease sale offshore Florida was in 1959. In the 1980s the state of Florida objected to further federal lease sales in offshore Florida, and the last one was held in 1985. Because of state objections, the federal government agreed to pay $200 million to nine oil companies to buy back leases south of 26 degrees north latitude.[16]
In the 1970s and early 1980s, oil companies drilled 16 wells on and around the Destin Dome, in federal waters off the Florida Panhandle; none were successful. Then from 1987 to 1995 Chevron made commercial gas discoveries on the Destin Dome 25 miles (40 km) off the coast. The discovery extended the Norphlet productive trend, which is highly productive in Alabama state waters in Mobile Bay. However, the state of Florida objected to plans to produce the deposits, and in May 2002, the US government agreed to buy back 7 leases from Chevron, Conoco, and Murphy Oil for $115 million.[17]
In 1947, the state of Florida issued a long-term oil and gas lease for state waters in the Gulf, stretching from Apalachicola Bay in the north to Naples in the south. The lease, which now belongs to Coastal Petroleum, was renegotiated in 1975 to leave Coastal with partial rights from 0–7.4 miles (0–11.9 km) from the shore, and full rights to state waters from 7.4–10.4 miles (11.9–16.7 km) from the shore.[18] Florida has since banned offshore drilling in state waters, and has a long-running legal dispute with Coastal over Coastal's efforts to drill the offshore lease.
Florida banned drilling in state waters in 1992, and has also opposed additional drilling in federal waters off Florida. However, in April 2009 three committees of the Florida House of Representatives approved a bill that would allow offshore drilling in state waters more than 3 miles (4.8 km) from shore. Because state waters extend only 3 miles (4.8 km) from shore on the east coast of Florida, the legislation would have affected only state waters on the Gulf coast of the state, where state waters extend out to 10.5 statute miles (16.9 km) from shore. The bill passed the Florida House in April 2009, but died soon after in the Florida Senate.[19]
Natural Gas Hydrates have long been known to exist in sediments beneath the Gulf of Mexico. In May 2009 the US Geological Survey announced the discovery of thick natural gas hydrate deposits beneath the Gulf of Mexico that are recoverable by current technology.[20] To date, natural gas from hydrates has not been produced from the Gulf of Mexico.