LLOG Exploration, a Covington oil company that specializes in deepwater production, signed an agreement with Houston-based TechnipFMC to buy subsea parts for a rig site in the Gulf of Mexico.
The equipment is for a project known as the Shenandoah discovery, which requires "subsea trees" on order that can withstand pressures up to 20,000 pounds per square inch. It will be developed using a new floating production system. An estimated 100 million to 400 million barrels of oil could be extracted from the site.
Shenandoah is about 200 miles south of New Orleans and the site is being explored by LLOG in partnership with Navitas Petroleum U.S., Beacon Offshore Energy, with 70% working interest, and Venari Offshore LLC, with 30% working interest. Shenandoah was discovered by Anadarko Petroleum Corp. in 2011 and six wells have been drilled there so far.
In late June, LLOG Exploration began production at its Buckskin oilfield about 190 miles southeast of Houston.
There were 22 active oil rigs in the Gulf of Mexico as of Oct. 4, the most recent Baker Hughes rig count report shows. That's the same number compared to a year ago.