The Oil Drum has an excellent in-depth article, as usual, that takes a closer look at the prospectivity, geology, economics, technology, reservoirs, hydrocarbons and logistics of the Lower Tertiary play in the Gulf of Mexico (LTGOM), the whole region, not just the Jack-2 discovery (earlier post).
With the successful test drilling of Jack-2 in the ultra deepwater Gulf of Mexico, there has been a media blitz proclaiming the good news. The "peak oil" theory is under attack. Business Week's September 7, 2006 article Plenty of Oil--Just Drill Deeper The discovery of reserves in the Gulf of Mexico means supply isn't topping out, is one of the most blatant attacks which the OD refutes point by point with the following conclusion: Business Week's assertion that really, really ultra-deepwater production from offshore regions like the LTGOM will "tip the balance of supply and demand in the long term" globally is unwarranted speculation.
Three of of their points that are consistent with my views and which I consider very important are :
1) US petroleum production averaged 5.093/mbd in the first 7 months of 2006. Assuming a generous future decline rate of about 5% for the US as a whole, production will be 4.149/mbd in 2010, a net decline of 0.944/mbd. Future production from the LTGOM might be 0.500/mbd sometime after that. If we add production from fields like Chevron's Tahiti, which is expected "to have a maximum daily production of 125,000 barrels", then it is reasonable to expect that Gulf of Mexico production will be a wash—declines will be offset six to eight years from now in the best case.
2) The current "peak oil" bashing going on in the media is more an indication of underlying concerns about the long term supply situation, not a refutation of peak oil theories. Those concerned about global oil depletion have never said that the world is running out of oil in the near-term or denied that advanced technology can increase recoverable reserves.
3) Rather than indicating continued abundance in oil supply, such measures may be viewed more accurately as indicating the great lengths oil producers must go to in order to find more oil to meet the world's insatiable demand. The "low-hanging fruit" is gone and so is the era of the cheap oil. Ultimately, this is the meaning of the Jack-2 test well and hopes for production from the Lower Tertiary of the Gulf of Mexico.
There are many more good points in the post which are well worth the read.