Oil Companies Expand Offshore Drilling, Pointing to Energy Needs

By Ivan Penn

Reporting from Shell's Appomattox offshore platform, New Orleans, Houston and Los Angeles

Published May 3, 2024Updated May 9, 2024

About 80 miles southeast of Louisiana's coast, 100,000 metric tons of steel floats in the Gulf of Mexico, an emblem of the hopes of oil and gas companies.

This hulk of metal, a deepwater platform called Appomattox and owned by Shell, collects the oil and gas that rigs tap from reservoirs thousands of feet below the seafloor. Equipment on the platform pipes that fuel to shore.

Political and corporate leaders have pledged to reduce planet-warming emissions to net-zero by 2050. But oil companies like Shell are betting that the world will need oil and gas for decades to come. To serve that demand, they are expanding offshore oil and gas drilling into deeper and deeper waters, especially here in the Gulf of Mexico.

Offshore production, oil executives argue, is not only crucial to power cars, trucks and power plants but also better for the planet than drilling on land. That's because such operations emit far less of the greenhouse gases that are warming the planet than producing the same amount of oil and gas on land, according to industry estimates.

"The world will continue to need oil, by the way, even in 2050," Wael Sawan, chief executive of Shell, said in a recent interview. "It will have to be lower and lower emissions."

The greenhouse gas emissions associated with extracting a barrel of oil from the Gulf of Mexico are as much as a third lower than emissions from producing a barrel of oil from fields on U.S. soil, according to a report published last year by the National Ocean Industries Association, an industry group for offshore oil, gas and wind businesses. (Those numbers do not include the emissions created when fossil fuels are burned in engines or power plants, which are much greater than emissions from producing and refining oil and gas.)

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