Modeling lost production from destroyed platforms in the 2004–2005 Gulf of Mexico hurricane seasons

Hurricanes Ivan, Katrina, and Rita passed through the Gulf of Mexico during 2004 and 2005 and resulted in the largest number of destroyed and damaged offshore oil and gas structures in the history of Gulf operations. In the final official government assessment, a total of 126 platforms were destroyed and over 183 structures were identified as having extensive damage. Production associated with wells and structures that are not redeveloped are classified as lost. The purpose of this paper is to derive functional relations that describe the likely contribution the collection of destroyed assets would have made to future production in the Gulf of Mexico. We estimate that the total remaining reserves from the set of destroyed structures range in value between $1.3 and $4.5 billion depending on the assumptions employed. We summarize the impact of the storms on the Gulf of Mexico oil and gas infrastructure and discuss the main issues involved in redevelopment decision making. A meta-model analytic framework is applied to perform sensitivity analysis and to explore the interactions of assumptions on model output. A discussion of the limitations of the analysis is presented.