BP says new Gulf of Mexico project starts production

06 12, 2012 by Reuters

Oil major BP said oil had started pumping from a new project in deepwater in the Gulf of Mexico, its first new development to come onstream since the Macondo disaster in 2010 caused the largest offshore spill in U.S. history.

BP said on Tuesday the Galapagos development started initial production earlier in June, with oil flowing to a nearby platform 140 miles south east of New Orleans in water depths of 6,500 feet.

The Galapagos project was named by BP as one of a handful of major projects which will help demonstrate its return to work in the Gulf of Mexico, where it is the largest producer of oil and gas in a region which is key to its future, despite the oil spill at its deepwater Macondo well two years ago.

Last October, U.S. regulators granted BP its first permit to drill a new well since the April 2010 disaster, which spewed more than 4 million barrels of crude into the basin and killed 11 people.

"The Galapagos development marks another significant step forward for BP in the Gulf of Mexico, and reflects the potential we continue to see in this world-class basin," James Dupree, Regional President of BP's U.S. Gulf of Mexico business said in a statement.

A spokesman for BP added that production at Galapagos would ramp up over the next four to six weeks, with a target of 26,000 barrels per day of production net to BP in the longer term.

BP, whose shares traded down 0.5 percent at 1430 GMT, owns a 56 percent stake in the three-block area where the Galapagos project is based and its partners are U.S. firms Noble Energy (NBL.N), Red Willow Offshore and Houston Energy.