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McMoRan: Ultra-deep gas discovery may open new gold mine for Gulf of Mexico shallow water

Posted on 28 November 2011

James R “Jim Bob” Moffett, co-chairman, president and CEO of McMoRan Exploration Co, compares the significance of the Davy Jones formation in the Gulf of Mexico to the Grasberg Mine in Indonesia, which is one of the largest gold mines in the world.

By Joanne Liou, editorial coordinator

In light of the completion and flow test of one of McMoRan Exploration’s wells in the Gulf of Mexico (GOM), James R “Jim Bob” Moffett, co-chairman, president and CEO of McMoRan, deciphered the GOM geology to explain the hydrocarbon potential of the shallow-water ultra-deep gas plays. “People were really confused about the geology of the Gulf of Mexico, including me, because the deepwater Thunder Horse discovery changed everybody’s perception of what the subsurface terrain in the Gulf was and gave us a complete new understanding of the footprint of the biostratigraphic column, which have been drilled since Spindletop,” Mr Moffett said at the 2011 IADC Annual General Meeting in Austin, Texas, on 10 November.

That new understanding has led to a massive new potential on the GOM shelf.

Located in 20 ft of water about 10 miles south of Louisiana, McMoRan’s ultra-deep Davy Jones discovery in January 2010was one of the largest ultra-deep discoveries on the GOM shelf at about 29,000 feet. “I call the Davy Jones discovery the new Grasberg – not just because of its size but because of its impact,” Mr Moffett said, referring to the Grasberg Mine, which is one of the largest gold mines in the world.

“All we did was prove the Gulf of Mexico’s geosyncline (area of accumulated sediments) was three times as large as any of us had suspected,” he said. “For that to take place in the year 2000 is almost unbelievable after having drilled hundreds of thousands of wells.”

Recent well log data from the first Davy Jones confirms the presence of Wilcox-age sands and the prospect of Tuscaloosa sands and Cretaceous carbonates. The Tuscaloosa sands correlate with the Tuscaloosa trend in US onshore fields and hint at a carbonate section similar to Mexico’s onshore Tabasco field and offshore Cantarell Complex reservoirs. McMoRan expects to complete a flow test on the Davy Jones No 1 well by the end of the year, followed by a flow test of the Davy Jones No 2 well in 2012.

To meet the demands of this new territory, the project called for advanced technology for ultra-deep wells. “The difference between (Davy Jones and) deepwater is you have 1,000 feet of water over it instead of sediment, so we have the same structure at the same depth, but our temperatures are over 400°Fas opposed to 300°F . Pressures are 18,000 (psi) versus 14,000, and it’s all because of geostatic overpressure – the fact that water is less dense than sediment,” Mr Moffett said. A blowout preventer made to handle 30,000 lbs of bottomhole pressure was specifically built for the Davy Jones development, he added.

“All we’ve done is take the puzzle and linked up onshore and deepwater,” Mr Moffett said. “So far we have four wells in a 200-sq-mile area. If this works and we can flow (the wells) and the reserves, there’s 100 Tcf of gas in less than 100 ft of water.”

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