New Orleans (Platts)--19Mar2013/621 pm EDT/2221 GMT

Anadarko Tuesday said its Shenandoah-2 well in the deepwater US Gulf of Mexico hit more than 1,000 net feet of oil pay, calling it one of the company's largest finds in the Gulf.

The well, located in Walker Ridge block 51, was drilled to a depth of 31,405 feet in about 5,800 feet of water, Anadarko said in a statement.

The well is about one mile southwest of the company's Shenandoah-1 discovery.

"We are incorporating the information obtained from Shenandoah-2 into our planning and anticipate further appraisal drilling to advance this potentially giant project," Bob Daniels, Anadarko's vice president of deepwater and international exploration, said.

By contrast, more than 300 feet of pay was encountered in the original discovery well, at Walker Ridge block 52, Anadarko said in previous statements.

Anadarko operates Shenandoah-2 with a 30% working interest. Partners are ConocoPhillips (30%), Cobalt International Energy (20%), Marathon Oil (10%), and Venari Resources (10%).

Daniels called the Shenandoah-2 well "one of Anadarko's largest oil discoveries in the Gulf of Mexico, with ... reservoir rock and fluid properties of much higher quality than previously encountered by industry in Lower Tertiary discoveries."

Shenandoah, the adjacent Yucatan prospect, and the "very encouraging results from the nearby Coronado well" strategically positions Anadarko in the Shenandoah Basin, "which has the potential to become one of the most prolific new areas in the deepwater Gulf of Mexico," said Daniels. Yucatan, located at Walker Ridge block 95, is still being drilled.

Meanwhile, Larry Archibald, senior vice president of exploration for ConocoPhillips, said the Shenandoah discovery follows "very positive indicators of hydrocarbons" in nearby Coronado, which Chevron operates and both ConocoPhillips and Anadarko have minority stakes.

"We believe this discovery [Shenandoah] could be material," Archibald said. The find, "together with the doubling of our deepwater Gulf of Mexico acreage position in the last two years, reinforces our global exploration strategy of getting into the right plays early in their life-cycle."

Coronado, at Walker Ridge blocks 98/143, was drilled to a total depth of 31,866 feet in 6,127 feet of water. The well is located about 12 miles southeast of Shenandoah. Results from Coronado are still being evaluated, said ConocoPhillips.

Shenandoah-2 and the original Shenandoah discovery well are sited in what Cobalt called the Inboard Lower Tertiary, a section north and west of earlier finds in the emerging Lower Tertiary play, at fields such as Chevron-operated Jack/St Malo which is being developed and Petrobras' Cascade.

The ILT, like the Lower Tertiary, is a trend in deepwater and at very deep total depths. Cobalt has called the ILT a potential "crown jewel" of the US Gulf of Mexico. It forms a large oval around where the Gulf's Green Canyon, Walker Ridge, Keathley Canyon and Garden Banks areas converge, a couple of hundred miles offshore Louisiana.

--Starr Spencer, starr_spencer@platts.com couple of hundred miles offshore Louisiana.

--Starr Spencer, starr_spencer@platts.com
--Kevin Saville, kevin_saville@platts.com
--Edited by Katharine Fraser, katharine_fraser@platts.com

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