BP Bolsters U.S. Oil & Gas Spending Through 2025

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Researched by Industrial Info Resources (Sugar Land, Texas)--BP plc (NYSE:BP) (London, England) is answering calls to boost its oil output as inflation stubbornly persists. The oil and gas giant announced it will increase spending for its onshore U.S. assets--mostly in Texas--41% to $2.4 billion in 2023, while its offshore Gulf of Mexico spending will go up 15% to an average $2.3 billion. Industrial Info is tracking more than $4.5 billion worth of active BP oil and gas projects across the U.S., about 75% of which is attributed to projects already under construction.

Click on the image at right for a graph detailing BP's active U.S.-based oil and gas projects, by project type.

BP's offshore efforts are led by its massive Mad Dog 2 project in the Gulf of Mexico, which is estimated to total $9 billion of investment. In development since 2014, the project likely will see its $3 billion Argos floating production unit (FPU) wrap up in the coming weeks, followed by a 22-well drilling program sometime this summer. Located in the Green Canyon area, Mad Dog 2 has an estimated production capacity of 140,000 barrels per day (BBL/d). Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Project Database can read detailed project reports on the FPU and drilling program.

Altogether, BP expects to invest $7 billion in its Gulf of Mexico assets through 2025, following $10 billion of investment since 2018. The company already operates four deepwater production platforms in the Gulf: Atlantis (from which the Argos is modeled), Mad Dog, Na Kika and Thunder Horse. At the original Mad Dog site, the company is reviewing proposals to drill two to four additional water injection wells at its South West location, and another two to four at its North West location. Subscribers can read detailed reports on the proposed South West and North West projects.

In October, BP spudded an appraisal well at its West Puma oil field development in the Gulf, with results expected early this year. The company is considering one or two production wells and supporting infrastructure for the development, which would be tied to the Argos FPU via a subsea pipeline. If approved, it would not finish construction until fourth-quarter 2025, at the very earliest. Subscribers can read detailed project reports on the drilling program, infrastructure and pipeline.

Despite the announced spending boost, BP expects its overall production in the Gulf to average about 350,000 barrels of oil-equivalent per day by the mid-2020s, a drop from its previous estimate of 400,000 barrels.

BP's U.S. onshore oil and gas business holds assets in the Permian Basin in Texas, the Eagle Ford Shale in Texas, and the Haynesville Basin in Louisiana, all of which were acquired in 2018, among other properties. Subscribers can click here for a list of detailed plant profiles.

"Our onshore oil and gas business, BPX Energy, is investing $1.3 billion into its assets in Texas's Permian Basin," the company said in a press release. "Our first centralized facility operating here, Grand Slam, is BPX Energy's largest infrastructure investment to date."

BP also is staking out more ground in the growing market for renewable fuels. The company recently completed its $4 billion acquisition of Archaea Energy Incorporated, a leading provider of renewable natural gas (RNG). Industrial Info is tracking progress at 27 Archaea facilities across the U.S. Subscribers can click here for a list of detailed plant profiles.

"Archaea expands BP's presence in the U.S. biogas industry, enhancing its ability to support customers' decarbonization goals and progressing its aim to reduce the average lifecycle carbon intensity of the energy products it sells," the company said in a press release. "BP expects investment into its transition growth businesses to reach more than 40% of its total annual capital expenditures by 2025, aiming to grow this to around 50% by 2030."

Subscribers to Industrial Info's GMI Project Database can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.

Subscribers can click here for a full list of reports for active BP projects across the U.S.

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) platform 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 more than 200,000 current and future projects worth $17.8 trillion (USD).