Despite Second GoM Permit, Don't Expect Surge In US Deep-Water Drilling

Though US regulators have decided to allow a second deepwater Gulf of Mexico drilling project, don’t bet on a rush of permits to follow, FBR Capital Markets says. Instead, expect “a long period of slow approvals” as offshore regulators work through a “sustained bottleneck” of drilling permit applications that face much more scrutiny since the Deepwater Horizon disaster, firm says. Near-term drilling is likely to be for wells begun before the April blow-out and in depths within range of spill containment systems, FBR says. BHP Billiton’s (BHP) permit to resume drilling a well in 4,234 feet of water meets those criteria.