The US Department of the Interior Implements New Policy to Boost Offshore Oil Production

The US Department of the Interior has introduced a new policy aimed at increasing offshore oil output in the Gulf of Mexico. The Bureau of Safety and Environmental Enforcement has implemented new parameters for downhole commingling in the Paleogene (Wilcox) reservoirs, allowing for an expanded pressure differential from 200 psi to 1,500 psi.

According to the Interior, this change could potentially increase production output by approximately 10%, resulting in a production increase of over 100,000 barrels per day over the next decade. The Interior also noted that further gains may be possible as operators provide additional data.

Benefits of Commingled Production

A study conducted by the University of Texas has shown that commingled production maximizes per-well oil production when compared to sequential schemes. Over a span of 30 years, commingled production could lead to 61% more oil recovery, and over 50 years, it could yield 21% more.

Policy Update and Regulations

The policy shift is based on modern reservoir performance analysis and updates outdated guidance from a 2010 government study. Under the updated rules, operators are now able to safely produce from multiple reservoirs with greater pressure differentials, as long as they adhere to new conditions such as fluid compatibility certification, pressure monitoring, and regular performance reporting to BSEE.

Enhancing Resource Conservation

The Interior expects that this new policy will not only increase production but also enhance resource conservation by expediting development from each reservoir. This proactive approach aims to prevent waste and extract more value from every well.