Insight
Widening LLS Brent differential another uncertainty for deepwater GoM project economics
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Report summary
We estimate that a change in the future differential between LLS and Brent compared to the historical average will result in a US$15.5 billion decrease in value in deepwater GoM. As more US onshore crude is transported to the Gulf Coast, Wood Mackenzie expects the LLS-Brent differential to widen further. Despite this drop in value, we do not anticipate that any future projects will become uneconomic as a result of this change alone.
Table of contents
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Influx of domestic crude to the Gulf Coast weighs on LLS
- Crude qualities determine GoM price differentials
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A cheaper LLS erodes value in the long-term
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What is at risk?
- Probable developments are still economic
- Ultimate recovery matters more
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Appendix
- Modelling Assumptions
- Economic Assumptions
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What is at risk?
Tables and charts
This report includes the following images and tables:
- US crude benchmarks (nominal)
- Impact on value for top 10 projects
- Economic effects for top 10 probable developments
What's included
This report contains:
