BP makes oil discovery off US Gulf coast

By Sheila Dang

-BP has made an oil discovery at the Far South field in the U.S. Gulf of Mexico, it said on Monday, as the energy major seeks to grow production under a strategy reset announced earlier this year.

The exploration well was drilled in Green Canyon Block 584 about 120 miles (193.12 km) off the coast of Louisiana. Both the initial well and a sidetrack encountered oil. Preliminary data indicates a potentially commercial volume of oil and gas, the company said in a statement.

It also said it plans to increase output in the Gulf of Mexico to 400,000 barrels of oil equivalent per day by 2030. It expects global production to reach 2.3 million to 2.5 million boepd by the end of the decade, with potential to grow through 2035.

London-listed shares of BP (NYSE:BP) were up 4.72% in early trade.

BP is the operator of Far South with a 57.5% interest, while partner Chevron (NYSE:CVX) holds 42.5%. 

BP announced a strategy shift in February to turn around its underperformance, cutting planned investment in renewable energy to refocus on oil and gas.

Around 1 million boepd are expected to be delivered from the U.S. onshore and offshore regions by 2030.

BP plans more exploration in the ocean basin. It has approved the development of the Kaskida oilfield, which lies in a complex geological structure called the Paleogene, and plans to go ahead with a second Paleogene development, Tiber, later this year, CEO Murray Auchincloss told a conference last month.

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