In 2018, BP completed a $10.5 billion acquisition of BHP's world-class unconventional oil and gas assets in the Permian-Delaware basin in Texas, along with two premium positions in the Eagle Ford and Haynesville basins in Texas and Louisiana. These assets currently produce 190,000 barrels of oil equivalent per day, of which about 45% are liquid hydrocarbons.
The deal represents BP’s largest purchase since buying ARCO in 1999. BP Group Chief Executive Bob Dudley has called it ”a transformational acquisition for our BPX Energy business,” and BP Upstream Chief Executive Bernard Looney has said it will give the BPX Energy team “access to some of the best acreage in some of the best basins in the onshore U.S.”
Concurrently, BP’s Lower 48 business changed its name to BPX Energy. The change marks a new era of growth for BP’s U.S. onshore oil and gas unit, which has operated as a separate entity since 2015 and has achieved material improvements in operational and financial performance since then.
Even as it dramatically expands its operations, BPX Energy continues to be an industry leader in understanding and addressing the challenge posed by methane emissions.
Since 2000, the BPX Energy business has slashed its total greenhouse gas emissions by more than 2 million metric tons of carbon dioxide equivalent, with methane reductions accounting for most of the decline. That’s comparable to the annual electricity-related emissions of more than 300,000 typical homes.
The business regularly analyzes and tests innovative methane leak detection technologies that could help operators identify leaks more quickly and more efficiently. As part of those efforts, it is piloting the use of drone technology (unmanned aerial vehicles), while also testing other technologies that aim to quantify emissions.
In addition, BPX Energy recently launched a separate pilot project in which it teamed up with a Silicon Valley firm and applied a mathematical model to optimize production at 180 onshore wells in Wyoming. This led to a 75% reduction in venting emissions events, a 20 percent increase in production and a 20% reduction in costs. The project will expand to more than 2,000 onshore wells by the end of 2018.
As that example demonstrates, BP’s focus on reducing methane emissions is closely tied to its larger strategy of improving efficiency and productivity.
We also understand that reducing methane emissions with advanced technology can help make our operations safer, stronger and more reliable. In that sense, tackling the methane challenge is not only good for the environment, but also good for business.”
BPX Energy produces primarily natural gas, along with oil, condensate and natural gas liquids. In 2017, the business produced an average of 300,000 barrels of oil equivalent each day, and its investment and operating expenditures totaled more than $1.5 billion.
In 2018, it brought online five Mancos Shale horizontal wells in New Mexico. Horizontal wells allow companies like BP to reduce both surface disturbance and the number of production facilities needed to access a given reservoir, while also reducing the associated emissions. Meanwhile, the BPX Energy team expanded its presence in the east Texas portion of the Haynesville/Bossier shale gas formation, which could have more gas in place than almost any other shale formation in the United States.