Enbridge to Build Pipelines for BP's Kaskida in GOM

Enbridge Inc. is building new oil and gas pipelines for BP Exploration & Production Company’s recently sanctioned Kaskida development in the U.S. Gulf of Mexico (GOM).

Enbridge said in a news release it plans to build, own, and operate crude oil and natural gas pipelines in Kaskida, BP’s sixth hub in the GOM.

The crude oil pipeline, named the Canyon Oil Pipeline System, will be a combination of 24" and 26" pipe with a capacity of 200,000 barrels per day (bpd). It will originate in the Keathley Canyon area and deliver crude to the existing Green Canyon 19 platform, operated by Shell Pipeline Company LP for ultimate delivery to the Louisiana market, according to the release.

The natural gas pipeline, named the Canyon Gathering System, will be a 12" pipeline with capacity of 125 million cubic feet per day and will connect subsea to Enbridge's existing Magnolia Gas Gathering Pipeline, which then delivers to Enbridge's downstream FERC-regulated Garden Banks Gas Pipeline.

The definitive agreements are underpinned by long-term contracts “which are consistent with Enbridge's low-risk business model and provide utility-like returns,” the company said.

Further, the agreements contain options that BP may exercise to connect potential future production from its emerging Paleogene portfolio to the newly developed pipelines. Both the Canyon Oil and the Canyon Gas pipelines are being designed to accommodate connections from nearby discoveries, Enbridge noted.

Detailed design and procurement activities will begin in early 2025, with the pipelines expected to be operational by 2029. The cost of the pipelines will be approximately $700 million, according to Enbridge.

"We are extremely pleased to extend an existing relationship with BP and support their new deepwater development. This opportunity diversifies our Gulf of Mexico offshore business, strengthens our significant natural gas pipeline portfolio, and enhances our ability to meet the strategic needs of our customers," Cynthia Hansen, Enbridge EVP and President for Gas Transmission and Midstream, said. "The Canyon Oil and Gas pipelines offer an attractive opportunity for Enbridge to serve customers in the Gulf of Mexico and further expand our U.S. Gulf Coast footprint. The agreements generate stable and predictable cash flow and provide future growth opportunities”.

Kaskida will have a new floating production platform with the capacity to produce 80,000 barrels of crude oil per day from six wells in its first phase. Production is expected to start in 2029, BP said in an earlier news release. The company made an FID on the asset in July.

BP’s 100-percent-owned Kaskida field discovered recoverable resources currently estimated at around 275 million barrels of oil equivalent from the initial phase. Additional wells could be drilled in future phases, subject to further evaluation. Located in the Keathley Canyon area about 250 miles southwest off the coast of New Orleans, the Kaskida project unlocks the potential future development of 10 billion barrels of discovered resources in place across the Kaskida and Tiber catchment areas, according to the release, BP said.

BP noted that Kaskida is in “a prime location,” with a stable fiscal regime and access to the market. The project will be its first development in the GOM to produce from reservoirs that will require well equipment with a pressure rating of up to 20,000 pounds per square inch (20K). Advancements in 20K drilling technology, coupled with updated seismic imaging, enable the company to safely develop the field and to progress plans to develop other fields such as Tiber, which is expected to advance to a final investment decision next year, it said.

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