In a recent announcement that could significantly impact American energy production, the Department of the Interior has introduced a policy aimed at increasing offshore oil output in the Gulf of Mexico. This development aligns with the goals outlined in President Donald J. Trump’s Executive Order titled "Unleashing American Energy." The Bureau of Safety and Environmental Enforcement (BSEE) has revised the permissible parameters for Downhole Commingling in the Paleogene (Wilcox) reservoirs, increasing the allowable pressure differential from 200 psi to 1500 psi.
The policy change, grounded in technical consultations with industry representatives, is expected to boost production output by approximately 10%, equating to an increase of over 100,000 barrels per day in the next decade. This projection could see additional gains as more data is submitted by operators. Findings from a University of Texas study indicate that commingled production can enhance per-well oil production compared to sequential methods, providing 61% more oil recovery over 30 years and 21% more over 50 years.
“This is a monumental milestone in achieving American Energy Dominance,” remarked Secretary of the Interior Doug Burgum. “We’re delivering more American energy, more efficiently, and with fewer regulatory roadblocks. That means lower costs, more jobs, and greater security for American families and businesses as President Trump promised."
The revised policy is based on contemporary reservoir performance analysis and updates guidance from a 2010 study. Under these new regulations, operators are permitted to produce from several reservoirs with higher pressure differentials, provided they adhere to specific conditions like fluid compatibility certification and regular performance reporting to BSEE.
“This is a major win for domestic energy,” stated Kenneth C. Stevens, Principal Deputy Director of BSEE. “Thanks to the tireless work of our technical experts and our industry partners, this advancement enables increased recovery from existing wells, reducing the cost per barrel and strengthening our nation’s energy independence."
The initiative is designed not only to increase production but also to enhance resource conservation by accelerating reservoir development, helping prevent waste, and maximizing value from each well. By optimizing current operations without the need for new infrastructure or leases, the updated strategy aims to ensure long-term price stability and energy affordability for American households.
Further information can be accessed at www.bsee.gov.
