BP to Proceed with Mad Dog Project in Gulf of Mexico
DOW JONES & COMPANY, INC. 12:15 PM ET 12/1/2016
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LONDON—BP PLC said Thursday it would proceed with the second phase of its Mad Dog expansion project in the Gulf of Mexico, ending years of delays and speculation over its future in a low oil price environment.
The energy giant said it had cut the project's cost to $9 billion from the $20 billion estimated in 2013, highlighting the way the industry is driving down spending to make expensive deepwater projects work at lower oil prices.
BP plans to install a floating production facility about 6 miles from its existing platform, adding 140,000 barrels to the field's current daily output of 80,000 barrels of oil and 60 million gross cubic feet of natural gas.
The project is expected to begin production in late 2021, but BP's partners on it, BHP Billiton and Chevron Corp.(CVX), haven't decided whether to proceed.
Write to Sarah Kent at sarah.kent@wsj.com
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