$1.5 trillion in Gulf of Mexico oil from ultra deep water drilling and more ultra deep oil off the coast of Africa and Latin America

In spite of the BP oil spill, new technology is unlocking more oil in the Gulf of Mexico.

A key breakthrough has been new seismic tools that allow companies to see through layers of salt deposits that previously blocked their vision, opening up new parts of the formation to exploration. Conventional wisdom among geologists was that there would never be oil found beneath the salt — a belief blown apart as wells such as Jack and St. Malo proved oil was hidden there, after all.

Engineering innovations enable them to drill five miles into the earth through waters more than 10,000 feet deep, where temperatures are more than hot enough to boil water and high pressures approach the weight of four cars resting on one square inch.

The success rate in the Lower Tertiary so far has been about 60 percent, with 40 percent of discoveries having commercial potential — a “tremendous” rate considering that 30 percent is considered good, Chevron’s Ryan said.

The value of the Lower Tertiary extends far beyond the Gulf of Mexico as companies tackle similar ultra-deep projects and formations off the coasts of Africa and Latin America. The engineering, seismic technology and basic experience obtained in the Gulf can be leveraged to lower costs and raise success rates in those regions.

The Gulf is heading for record deep-water output equivalent to almost 2 million barrels of oil a day in 2020, according to industry researchers Wood Mackenzie Ltd. The U.S. estimates about 15 billion barrels of recoverable oil remain to be found in the Lower Tertiary.

While most U.S. shale fields have now been identified and mapped, the Gulf is seen as having much bigger yet-to-be-discovered potential — 48 billion barrels of oil compared to the 13 billion barrels estimated for onshore and coastal oilfields, according to U.S. data.

An extra million barrels per day from the Gulf of Mexico will be joining the 1-2 million barrels per day that will be added from the tight oil in Texas and North Dakota.

The US already produces 7.75 million bpd of crude oil. 3-4 million bpd will push that to 10.75 to 11.75 million bpd of crude oil.

A 2012 prediction that Texas would produce 2.5 million bpd before Jan 2014 has already come true Texas appears heading to 4 million bpd by 2016.

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