The average unit operating cost of oil and gas production in the deepwater Gulf of Mexico increased by about 45% during 2010-12 but, at less than $5/boe, still provided “highly attractive” oil netbacks, according to a study by Ziff Energy Group.
The cost increase resulted from a combination of operating-cost spending increases and, to a lesser extent, production declines, said the ninth edition of Ziff Energy’s Gulf Of Mexico Deepwater Improving Field Performance.
The study evaluated 24 deepwater producing assets owned by six operators, which collectively account for 736,000 boe/d of deepwater gulf production and $887 million in operating expense.
It reported average operating costs of $3.37/boe in 2010, $4.97/boe in 2011, and $4.83/boe in 2012.
The study found “a surprisingly wide range of uptime performance,” Ziff Energy said. “The value of the unplanned deferment ($1.7 billion) was 1.9 times the total [operating expenditure] ($0.9 billion) of the assets” in 2012, it said.
The study evaluated production deferments from planned losses, unplanned facility failures, unplanned well failures, unplanned reservoir and other problems, weather, midstream and market factors, and other external causes.
“Weather was a big factor in 2012,” it said.