Chevron Approves $5.7b Deepwater Oil Project

Chevron, the largest US oil group, announced it has approved the development of a deepwater high-pressure oil project in the Anchor oil field in the US Gulf of Mexico, which will require $5.7 billion investment, in the industry’s first such deep-water high-pressure projec.

During the first development stage, the project will consist of a seven-well subsea development and a semi-submersible floating production unit.

First oil from Anchor is expected in 2024, Oil Price reported.

The facility at Anchor is designed to have capacity of 75,000 barrels of crude oil and 28 million cubic feet of natural gas per day. According to Chevron, the total potentially recoverable oil-equivalent resources at Anchor is estimated to top 440 million barrels.

Chevron is the operator of the field with a 62.86% working interest, while Total’s US unit holds the remaining 37.14% working interest.

“For new projects in the Gulf of Mexico, we have reduced development costs by nearly a third, compared to our last generation of Greenfield deep-water investments,” said Steve Green, president of Chevron North America Exploration and Production.

“This decision reinforces Chevron’s commitment to the deepwater asset class,” said Jay Johnson, executive vice president, Upstream, Chevron Corporation.

Chevron’s new project sanction comes a day after the US supermajor announced that it would write down $11 billion in assets in the fourth quarter, following a downward revision of its long-term forecast for oil and gas prices.