Japanese trading house Mitsui & Co. said Dec. 5 it has agreed to buy a 20% stake in four blocks in the U.S. offshore oil and gas fields in the Gulf of Mexico (GoM) from Royal Dutch Shell Plc (NYSE: RDS.A) for an undisclosed amount.
The move follows Mitsui's other investment decisions earlier this year including co-development of the Greater Enfield oil reserves off Western Australia and an $8 billion expansion of the Tangguh LNG project in Indonesia which is led by BP Plc (NYSE: BP), taking advantage of the recent drop in commodity prices.
In its latest deal, Mitsui Oil Exploration Co. will buy the 20% stake in four blocks in the Mississippi Canyon, located about 100 km (62 miles) south-southeast of New Orleans, in the GoM from a Shell subsidiary.
The recoverable resources of all the blocks are estimated to be more than 100 million barrels of oil equivalent, worth about $5.1 billion based on the current West Texas Intermediate crude futures price of about $51 a barrel.
Production of crude oil and gas would utilize the existing near field infrastructure, which could help early commercialization at lower development costs, the company said.
Production could start as early as 2019, a Mitsui spokesman said.
Recommended Reading
Exclusive: TES CEO Sees Electric Natural Gas as a Trillion Dollar Market
2024-03-26 - Marco Alverà, the co-founder and CEO of TES, details how electric natural gas from green hydrogen is a cheaper and easier to produce fuel and shares insight on its e-NG partnership with TotalEnergies, in this Hart Energy Exclusive.
CERAWeek: Human Oversight, Machine Power: AI’s Future in Energy
2024-03-22 - A CERAWeek panel tackles how AI's hunger for complexity can devour the energy industry's toughest challenges.
CERAWeek: BP Could Sanction GoM’s Kaskida this Year, CEO Says
2024-03-21 - BP Plc is eyeing the sanction of its Kaskida deepwater project in the Gulf of Mexico in 2024, the company’s CEO Murray Auchincloss said during CERAWeek by S&P Global.
CERAWeek: NOCs Balance Financial Realities, Energy Transition
2024-03-21 - National oil companies’ strategies include diversifying energy sources and seeking reserves located deeper in the ground and in deeper waters, while still working to curb emissions.