Tahiti: Risk, Planning, Risk, Investments, Risk, Risk

By March 26, 2007Energy

The long-range planning and risk-heavy investments undertaken by major energy companies always amaze us. The only sure payoff is they can count on is getting to call their deep-sea drilling platforms cool names like Tahiti.

Tahiti will be Chevron Corp.’s 100,000-ton island of high-powered steel and iron floating in 4,000 feet of water in the Gulf of Mexico.

The company aims to place Tahiti above its oil field of the same name about 190 miles south of New Orleans this summer and, by mid-2008, begin producing 125,000 barrels of oil each day from more than 20,000 feet below the seabed.

This week marks the fifth anniversary of the Tahiti test drilling (ChevronTexaco release here). If anything, the six years from drilling to (hoped-for) production is a fast schedule.

Chevron’s 2006 annual report (.pdf file) states the company spent nearly $13 billion in exploration and production operations. It acquired exploration acreage in Canada, offshore Norway and Western Australia and in the deepwater U.S. Gulf of Mexico, while realizing first production from projects in Angola, Azerbaijan, Trinidad and Tobago, and the U.K. North Sea.

Every gallon of gasoline pumped at the station represents considerable planning, the assumption of remarkable risks, and billions upon billions of dollars of investment. Funny how so many people try to drown out those facts with the populist drumbeat of cant and resentment.