New oil production begins in Gulf of Mexico

HOUSTON, Oct. 29 (UPI) -- The Big Bend project, a new single-well field online in the Gulf of Mexico, is on pace to reach maximum output before the end of November, Noble Energy said.

Noble, a company with headquarters in Houston, said it started production from its Big Bend project in the deep waters of the Gulf of Mexico. The single-well field should be producing around 20,000 barrels of oil equivalent per day in a matter of weeks. Around 90 percent of the overall production volumes are oil.

Gary Willingham, vice president of operations for Noble, said in a statement that Big Bend is among a handful of projects expected to come online for the company in the coming months, bringing "significant oil production and cash flow to the business."

Noble said its nearby Dantzler project is expected to enter into production in early November. Combined with other fields, all of which are located in the Mississippi Canyon in the Gulf of Mexico, output should contribute to a maximum net production rate of 20 million barrels of oil equivalent per day to Noble.

An October report from the U.S. Energy Information Administration finds total U.S. crude oil production begins a gradual decline though August 2016. A dozen new projects expected online in the Gulf of Mexico by next year should boost offshore U.S. production from an estimated 1.4 million bpd in the fourth quarter to more than 1.6 million bpd in fourth quarter 2016.

Lower crude oil prices are, in part, behind the expected decline from inland basins in the United States, though output from the Gulf of Mexico offsets some of the drop in overall production.

"Short cycle times to first production, strong well deliverability, and low production costs from our Gulf of Mexico projects deliver attractive returns even in today's environment," Willingham said.