Equinor carves Gulf of Mexico niche with Monument discovery

Norwegian operator Equinor today announced it struck 200 feet of oil pay at the Monument exploration well, in the US Gulf of Mexico.

Mfon Usoro, senior research analyst at Wood Mackenzie, said: “In the current low oil price environment, Equinor’s Monument discovery is a welcome one for the partners – Repsol and Petronas subsidiary Progress Resources – and the wider US Gulf of Mexico. The discovery proves the mature region still has more life in it.”

Monument is Equinor’s first discovery as an operator since its Yeti and PowerNap discoveries in 2015. Equinor has a strong footprint in the US Gulf of Mexico (largely in non-operated assets), but the company has indicated plans to become an operator in the region, with growth focused on Paleogene-rich resources.

Wood Mackenzie expects Monument to be one of Equinor’s first commercialised discovery. But the company could face technical challenges with the complex and often compartmentalised Paleogene reservoir. Based on the drill depth of over 32,000 feet, the discovery could be similar to other ultra high-pressure fields requiring 20,000 psi-rated equipment which indicates significantly higher development cost.

The well was spudded in December last year by the Pacific Khamsin drillship.

Exploration activity in 2020 has taken a hit as companies have quickly slashed budgets. It is likely that appraisal efforts at Monument will take a back seat until prices recover.