Cover and Title Page

PREFACE

INTRODUCTION

BACKGROUND

• Definitions
  
• Expanding Frontier
  
• Seismic Activity
  
• Exploration Activity
  
• Leasing Activity
  
• Environmental Activity
  
• Ocean Current Monitoring
  
• Challenges and Rewards

• Bidding and Leasing Trends
• Lease Ownership
• Future Lease Activity

• Drilling Activity
• Development Systems
• Subsea Trends
• New Pipelines

• Discoveries
• Reserve Potential
• Production Trends
• Companies and Production
• Production Rates

• Development Cycle
• Drilling the Lease Inventory
• Expanding Frontier

• Appendix A. Announced Deepwater Discoveries (Sorted by Project Name)
  
• Appendix B. Announced Deepwater Discoveries (Sorted by Discovery Date)
  
• Appendix C. Chronological Listing of GOM Lease Sales by Sale Location and Sale Date
  
• Appendix D. Deepwater Studies Program
  
• Appendix E. Companies Defined as Majors in this Report
  
• Appendix F. Number of Deepwater Production Facilities Installed Each Year (including Plans through 2006)
  
• Appendix G. Subsea Completions
  
• Appendix H. Average Annual GOM Oil and Gas Production

• Figure 1. The Gulf of Mexico OCS is divided into Western, Central, and Eastern Planning Areas. Water-depth categories used in this report are shown in addition to shaded Deep Water Royalty Relief Act zones
• Figure 2. Progressive deepwater 3-D seismic permit coverage
• Figure 3. Deepwater Gulf of Mexico 3-D seismic permit coverage from 1992 to 2003
• Figure 4. Pre-stack depth migration coverage from various industry sources
• Figure 5. Stratigraphic chart highlighting new play potential
• Figure 6. Frontier plays in the deepwater GOM
• Figure 7. Location of known gas hydrates in the Gulf of Mexico
• Figure 8. Gas hydrates on the seafloor in Green Canyon Block 185 (photo courtesy of GERG/Texas A&M University)
• Figure 9. Deepwater leases issued in the Gulf of Mexico
• Figure 10. Active leases in the Gulf of Mexico
• Figure 11. Total active leases by water depth
• Figure 12. Environmental and deepwater administrative features
• Figure 13. Grid EA status
• Figure 14. ROV surveys including known chemosynthetic communities
• Figure 15. Loop and eddy currents in the Gulf of Mexico (image courtesy of Horizon Marine, Inc.)
• Figure 16. Deepwater discoveries in the Gulf of Mexico
• Figure 17. Ownership of deepwater discoveries (includes industry-announced discoveries)
• Figure 18. Estimated volumes of 80 proved deepwater fields
• Figure 19. Onshore service bases for existing deepwater structures
• Figure 20. Onshore service bases for pending deepwater plans
• Figure 21. Current, potential, and future hub facilities in the Gulf of Mexico
• Figure 22. Oil and gas pipelines with diameters greater than or equal to 20 inches
• Figure 23. Deepwater oil and gas pipelines in the Gulf of Mexico
• Figure 24. Number of leases issued each year, subdivided by DWRRA water-depth categories
• Figure 25a. Number of leases bid on for each deepwater interval
• Figure 25b. Total bid amounts in deepwater intervals
• Figure 25c. Average bid amount per block in deepwater intervals
• Figure 26. Rejected shallow- and deepwater Gulf of Mexico bids
• Figure 27. Ownership of deepwater leases
• Figure 28. Anticipated lease expirations in the Gulf of Mexico
• Figure 29. The Deepwater Horizon, a dynamically positioned, semisubmersible drilling unit (photo courtesy of Transocean)
• Figure 30. The Discoverer Deep Seas, a Class 1A1, double-hulled, dynamically positioned drillship (photo courtesy of Transocean)
• Figure 31. Average number of rigs operating in the deepwater GOM. (White bars are estimates.)
• Figure 32. Approximate number of deepwater rigs (GOM and worldwide) subdivided according to their maximum water-depth capabilities. Inset shows the number of deepwater rigs in various locations
• Figure 33. All deepwater wells drilled in the Gulf of Mexico, subdivided by water depth
• Figure 34. All deepwater exploratory wells drilled in the Gulf of Mexico by water depth
• Figure 35. Deepwater development wells drilled in the Gulf of Mexico, divided by water depth
• Figure 36. Deepwater exploratory wells drilled in the Gulf of Mexico
• Figure 37. Deepwater development wells drilled in the Gulf of Mexico
• Figure 38. Deepwater EP's, DOCD's, and DWOP's received in the Gulf of Mexico since 1992
• Figure 39. Maximum wellbore true vertical depth (TVD) drilled in the total Gulf of Mexico each year
• Figure 40. Maximum water depth drilled each year
• Figure 41. Deepwater development systems
• Figure 42. Three different development systems (left to right): a SeaStar TLP installed at ChevronTexaco�s Typhoon field, a spar installed at ChevronTexaco�s Genesis Field, and a semisubmersible at Shell/BP�s Na Kika Field (images courtesy of ChevronTexaco, Shell International Exploration and Production Inc., and BP)
• Figure 43. Progression of spar deepwater development systems (image courtesy of Technip-Coflexip)
• Figure 44. GOM deepwater production facilities installed each year (including plans through 2006). Inset shows production systems for currently producing fields (including subsea systems)
• Figure 45. Crosby Project (MC 899) subsea equipment layout (image courtesy of Shell International Exploration and Production Inc.)
• Figure 46. Number of shallow- and deepwater subsea completions each year
• Figure 47. Maximum water depth of subsea completions each year
• Figure 48. Water depth of subsea completions
• Figure 49. Length of subsea tiebacks
• Figure 50a. Approved deepwater oil and gas pipelines less than or equal to 12 inches in diameter
• Figure 50b. Approved deepwater oil and gas pipelines greater than 12 inches in diameter
• Figure 51. Proved reserve additions
• Figure 52. Proved and unproved reserve additions
• Figure 53. Average field size using proved and unproved reserves
• Figure 54. Number of deepwater field discoveries and resulting number of producing fields
• Figure 55. Number of deepwater field discoveries and new hydrocarbons found (MMS reserves, MMS resources, and industry-announced discoveries)
• Figure 56. BOE added (reserves, known resources, and industry-announced discoveries)
• Figure 57. Modified creaming curve for shallow- and deepwater areas of the GOM (includes reserves, resources, and industry-announced discoveries)
• Figure 58. Reserves and future discovery volumes in the deepwater GOM
• Figure 59. Relative volume of production from each GOM lease. Bar heights are proportional to total lease production (barrels of oil equivalent) during that interval
• Figure 60. Estimated U.S. oil and gas production in 2002
• Figure 61a. Comparison of average annual shallow- and deepwater oil production
• Figure 61b. Comparison of average annual shallow- and deepwater gas productio
• Figure 62a. Contribution of DWRRA oil production to total oil production in water depths greater than 200 m (656 ft)
• Figure 62b. Contribution of DWRRA gas production to total gas production in water depths greater than 200 m (656 ft)
• Figure 63a. Contributions from subsea completions toward total deepwater oil production
• Figure 63b. Contributions from subsea completions toward total deepwater gas production
• Figure 64a. Comparison of major and nonmajor companies in terms of deepwater oil production
• Figure 64b. Comparison of major and nonmajor companies in terms of deepwater gas production
• Figure 65a. Comparison of major and nonmajor companies in terms of shallow-water oil production
• Figure 65b. Comparison of major and nonmajor companies in terms of shallow-water gas production
• Figure 66a. Contributions from each major oil company toward total deepwater oil production
• Figure 66b. Contributions from each major oil company toward total deepwater gas production
• Figure 67a. Maximum production rates for a single well within each water-depth category for deepwater oil production
• Figure 67b. Maximum production rates for a single well within each water-depth category for deepwater gas production
• Figure 68a. Average production rates for shallow-water and deepwater oil well completions
• Figure 68b. Average production rates for shallow-water and deepwater gas well completions
• Figure 69a. Deepwater oil production profiles (oil wells coming onstream between 1992 and 2002)
• Figure 69b. Deepwater gas production profiles (gas wells coming onstream between 1992 and 2002)
• Figure 70a. Maximum historical oil production rates for Gulf of Mexico wells
• Figure 70b. Maximum historical gas production rates for Gulf of Mexico wells
• Figure 71. Deepwater projects that began production in 2003 and those expected to begin production by yearend 2007
• Figure 72. Deepwater lease activity and oil/natural gas prices (prices from U.S. Energy Information Administration: oil through September 2003 and natural gas through July 2003)
• Figure 73a. Lag from leasing to first well for producing deepwater fields
• Figure 73b. Lag from leasing to qualifying for producing deepwater fields
• Figure 73c. Lag from leasing to first production for producing deepwater fields
• Figure 74. Year in the lease term in which BOE was discovered and percent of leases were tested, for deepwater leases, 1974-1994
• Figure 75. Activity on deepwater leases
• Figure 76a. Leases drilled and barrels found
• Figure 76b. Exploration effort and reward: number of leases drilled in a year and BOE discovered per lease
• Figure 77a. Relationship between number of leases issued and number of leases drilled, 1974-1993
• Figure 77b. Relationship between number of leases issued and number of resulting producing leases, 1974-1993
• Figure 77c. Relationship between number of leases drilled and number of resulting producing leases, 1974-1993
• Figure 78. The challenge of deepwater lease evaluation
• Figure 79. Comparison of 2000, 2002, and 2004 deepwater GOM reports: successive increases in deepwater BOE

• Table 1 List of Deepwater Discoveries in Water Depths Greater than 7,000 ft (2,134 m)
• Table 2 Completed Grid PEA's Within the Central and Western Planning Areas of the Gulf of Mexico
• Table 3 LNG Projects Proposed in the Gulf of Mexico
• Table 4 Development Systems of Productive Deepwater GOM Projects
• Table 5 Top 20 Producing Blocks for the Years 2001-2002