'Bright' Investments Paid Off

Area-wide lease sales, inaugurated in 1983, provided the oil industry an opportunity to explore for oil and gas in the deep water Gulf of Mexico, a southern extension of the oil-rich offshore Louisiana shelf province.

Key to Shell's success in reducing risk in this high-cost environment was use of a direct detection of hydrocarbons technique, commonly called "bright spots."

All of Shell's exploration wells in this play were selected to penetrate "bright spots." The largest discoveries were found to have the added benefit of deeper oil sands, where the seismic had weak or no visible amplitude anomalies.

Winning the Bid

By 1983, Shell's Cognac field was producing in 1,000 feet of water, and Exxon, Unocal and Conoco had oil production in fields of similar water depths.

In the first area-wide Central Gulf lease sale, leasing was brisk in water depths out to about 2,500 feet, concentrating in an area a few miles from the 600-foot water depth shelf edge. Shell, under the leadership of Billy Flowers, offshore vice president, and Doug Beckman, exploration general manager, leased several prospects and discovered Bullwinkle Field, which held about 150 million barrels. All of Shell's bids and drilling locations were based on detailed "bright spot" studies.

In the spring of 1984, several oil companies won leases on salt-related prospects in deeper water. Shell cautiously made only a few bids because of economic concerns, especially about technology available for deep-water subsea wellhead completions. Tom Velleca, general manager of geophysics, urged the offshore division to organize a team to search for opportunities in the Garden Banks area, western Gulf of Mexico.

Shell bid and won leases on several "leads," including two blocks in 2,900 feet of water over a salt dome named Auger, which was mapped by geophysicist B.B. Hughson.

At this time, I was named general manager-exploration for Shell Offshore and, during the next three years, was part of the team that discovered several major oil and gas fields in the deep water Gulf of Mexico.

Shell shot a proprietary grid of seismic over its Garden Banks area leases, and Auger was identified as the prospect with the most potential.

Two strong amplitude anomalies with good downdip structural conformity were observed at depths of about 15,000 feet on the salt dome's west flank. The "bright spots" extended west from Shells' acreage onto two adjacent unleased blocks.

Geophysicist Mike Dunn mapped a deeper anomalous amplitude at a depth of 19,000 feet, but data quality at this depth made the zone speculative.

Shell won the adjacent blocks in the 1985 sale with no competition. It was early in 1987 before Auger was drilled.