Anglo-Australian miner BHP Billiton has approved $2.2bn investment for its share in the Mad Dog Phase 2 oilfield project located in the Green Canyon area in the Deepwater Gulf of Mexico.
The $9bn Mad Dog Phase 2 project is the second stage of development of the BP-operated Mad Dog offshore field, which commenced production in 2005.
BHP Billiton has 23.9% stake in Mad Dog Phase 2 project while other partners include Chevron affiliate Union Oil Company of California 15.6%. BP Operates the project with 60.5% stake.
In December 2016, BP has approved the development of the Mad Dog Phase 2 project.
BHP Billiton operations petroleum president Steve Pastor said: “Mad Dog Phase 2 is one of the largest, discovered and undeveloped resources in the Gulf of Mexico, one of BHP Billiton’s preferred conventional deep-water basins.
“It offers an attractive investment opportunity for BHP Billiton and aligns with our strategic objective to build our conventional portfolio through the development of large, long-life, high-quality resources.”
The project includes development of a new floating production facility, which will have a capacity to produce up to 140,000 gross barrels of crude oil per day from up to 14 production wells.
The second Mad Dog platform will be located approximately 6 miles to the southwest of the existing Mad Dog platform, which has the capacity to produce up to 80,000 gross barrels of oil and 60 million gross cubic feet of natural gas per day.
According to BP estimates, the extension project will have a production capacity between 120,000boe and 140,000boe a day. Production is scheduled to commence in the 2022.
Between 2016 and 2020, BP intends to add approximately 800,000 net barrels of oil equivalent per day of production capacity from new projects.
Image: One of the BHP Petroleum’s platforms in deepwater Gulf of Mexico. Photo: courtesy of BHP Billiton.