Hercules Offshore, Inc. (HERO), BP plc (ADR) (BP)- Gulf of Mexico: Turbulent Seas or Smooth Sailing?

The two wells encountered net pay of 1,000 feet and 400 feet, respectively, and were drilled to total depths of about 31,000 feet in average water depths of 6,000 feet. ConocoPhillips (NYSE:COP) plans to continue to invest in drilling new wells and acquiring additional acres for future exploration.

In fact, the industry is currently preparing for another round of acreage auctions by the Bureau of Ocean Energy Management in late August. The agency will auction 20.7 million acres in the Western Gulf, including acres in water depths ranging from 16 to 10,975 feet. It’s estimated that there could be as much as 200 million barrels of oil and 938 billion cubic feet of natural gas under these acres, which is just another example of the Gulf’s great promise.

Final Foolish thoughts
The Gulf really does hold one of the keys to American energy independence. There is great promise from new finds as oil companies’ drill deeper into the Gulf. However, risks yet remain which is why it’s important for investors to keep a vigilant eye as turbulent seas could return at a moment’s notice.

The article Gulf of Mexico: Turbulent Seas or Smooth Sailing? originally appeared on Fool.com is written by Matt DiLallo.

Fool contributor Matt DiLallo owns shares of ConocoPhillips. The Motley Fool has no position in any of the stocks mentioned.

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