Well could become the nation's biggest new domestic source of oil, according to newspaper report.
September 5 2006: 12:36 PM EDT
NEW YORK (Reuters) -- Chevron Corp. said Tuesday it had successfully drilled for oil in the Gulf of Mexico's deep waters, in what could be one of the most significant finds for the domestic oil industry in a generation.
The successful well, known as Jack 2, reached a record total depth of 28,175 feet, coming in 7,000 feet of water and more than 20,000 feet under the sea floor. Analysts said the find suggested the success of that drilling may mean more oil than previously believed is available under the Gulf of Mexico, a region that already provides a quarter of U.S. output.
One published report suggested the breakthrough could increase U.S. oil reserves by as much as 50 percent.
During the test at record depths and pressure, the Jack No. 2 well flowed at more than 6,000 barrels of crude per day, Chevron (Charts) said. That puts it on a par with discoveries in exploration hot spots such as the waters off Angola.
With U.S. oil output in decline, big new fields are increasingly rare, and oil companies are widening their search to more difficult places
Chevron, the No. 2 U.S. oil company after Exxon Mobil (Charts), did not give an estimate of the field's reserves.
The Wall Street Journal cited Chevron officials as estimating recent discoveries in the Gulf of Mexico could hold as much as 15 billion barrels of oil and gas reserves. That would boost U.S. current reserves by 50 percent.
