Shell offshore well breaks depth record

Houston: Shell Oil said on Tuesday it has set a world water-depth record by drilling and completing an oil well in 2,852 metres of water in the Gulf of Mexico.

The well is part of Shell's Perdido Development project 322km south of Houston. It easily topped the previous record for a completed oil well in 2,118 metres of water - also set by Shell in the Gulf of Mexico. Anadarko Petroleum has completed natural-gas wells in about 2,700 metres of water in the Gulf.

Production at Perdido is scheduled to begin around 2010.

Shell says the project, which dates to a lease sale in 1996, will be capable of producing 130,000 barrels of oil equivalent a day.

Deepwater drilling in the Gulf dates to 1979 when Shell began production, but development really didn't take off until the 1990s as technological advancements made it more feasible. Today most continental US oil and gas production comes from the deepwater Gulf of Mexico, according to the US Energy Department.

Shell's new well is the latest indicator of how long it takes to bring ultra-deepwater projects to fruition and the ever-mounting exploration efforts oil companies are taking to find new sources of fossil fuels.