GoM Exhibits Staying Power

No matter what happens in the years ahead, the Gulf of Mexico is likely to maintain its strategic importance in the global energy picture.

Amy Myers Jaffe
Amy Myers Jaffe

“I still think there’s a lot of oil and gas to be produced, both from the U.S. side and the Mexican side,” said Amy Myers Jaffe, fellow in Energy Studies and director of the Energy Forum at the Baker Institute for Public Policy in Houston.

In August, Mexico’s government reported a promising discovery in the Gulf by state-owned oil company Pemex. The find came in an area known as El Perdido, about 25 miles from U.S. waters.

Initial estimates put the play’s reserves between four billion and 10 billion barrels of crude, adding to other reserve additions in the U.S. part of the Gulf.

“People believe that over the next decade we could see two-to-three million barrels of oil per day being produced from the Gulf of Mexico,” Jaffe said.

Gulf of Mexico federal offshore oil production accounts for 23 percent of total U.S. crude oil production, according to the U.S. Energy Information Agency. In the recent past, the offshore and onshore areas of the Gulf region have accounted for more than half of U.S. oil production.

More than 40 percent of total U.S. petroleum refining capacity is located along the Gulf Coast.

But the strategic importance of the Gulf of Mexico goes beyond its contribution to U.S. production, Jaffe said. Historically, the Gulf also has been a development area and proving ground for new offshore technology.

“All the big global players are active in the Gulf of Mexico. New technology comes out of there and is being used in other parts of the world,” she said.

And technology might be the biggest story in the Gulf.

“We are at a very pivotal time in energy,” Jaffe said. “There are a lot of new technologies being deployed at the same time.”

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Emphasis: Gulf Coast