BP Starts Up U.S. Gulf Expansion Project

Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)

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Summary

British energy company BP started up the expansion to its Atlantis platform ahead of schedule. The announcement followed a down-beat auction for regional drilling rights.

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More Barrels Coming from BP

British energy company BP (London, England) said Thursday it expected peak production of 15,000 barrels of oil equivalent per day through an expansion to its Atlantis platform off the U.S. Gulf Coast.

BP said it delivered first oil from the Atlantis Drill Center 1, an expansion to one of BP's longest-operational platforms off the U.S. Gulf Coast. The facility boasts a net production capacity of 200,000 barrels of oil per day (BBL/d).

"Atlantis Drill Center 1 caps off an excellent year of seven major project start-ups for BP," said Gordon Birrell, the executive vice president for production. "This project supports our plans to safely grow our upstream business, which includes increasing U.S. production to around 1 million barrels of oil equivalent per day by 2030."

First oil came two months ahead of schedule and marks the company's seventh major startup of the year. All told, the expansion is part of a broader effort to bolster the production capacity in U.S. offshore.

Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project and Plant databases can learn more about projects at Atlantis--including capacities, investment values and necessary equipment--here and here.

In August, the company got production support from the start of operations at the Argos Southwest Expansion project, which tied back three wells to existing infrastructure to lift output by 20,000 barrels of oil equivalent per day. Argus is located in the Mad Dog Field. Subscribers can learn more about Mad Dog from a detailed plant profile.

Gulf Oil on Growth Trajectory, But Auction Dismal

The waters off the U.S. Gulf Coast are the only place for meaningful growth in crude oil production next year, with gains of around 3% annually expected for 2026.

On Wednesday, the U.S. Bureau of Ocean Energy Management held the inaugural auction for offshore drilling rights under U.S. President Donald Trump's signature spending bill.

"These sales drive economic growth, support cutting-edge technology, and provide a fair return to taxpayers," said Erik Milito, the president of the National Ocean Industry, adding offshore barrels tend to have a lower carbon footprint than shale.

The United States is the world leader in crude oil production, but output from the lucrative shale basins in the Lower 48 states is on pace for a slight decline next year. Domestic crude oil prices will be lower than some shale drillers need to make a profit and markets are looking oversupplied.

Apart from a lower carbon intensity, offshore oil tends to have lower break-evens than inland shale. The U.S. Energy Department expects production from off the Gulf Coast to average 1.95 million BBL/d next year, accounting for about 14% of total U.S. output.

More than 30 companies, including BP, submitted bids for offshore drilling, with more than $300 million put on the table. That compares with the $382 million offered during the last lease sale under former President Joe Biden in December 2023.

By the Numbers

• $1 million Boe/d expected by BP in the U.S. market by 2030
• Atlantis started up two months early
• $300 million: latest U.S. Gulf Coast drilling auction

Key Takeaways

• BP eyes major expansions off the U.S. Gulf Coast.
• Offshore production is the only source of growth next year.
• Trump's first offshore auction was lackluster.

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).