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U.S. Gulf of Mexico oil producers consolidation accelerates

HOUSTON (Reuters) – Oil and gas producers in U.S. Gulf of Mexico have consolidated at a faster rate during the pandemic, new government data shows, as crashing prices squeezed out smaller drillers who had been seen as the industry’s future.

The top 10 producers – led by Royal Dutch Shell, BP Plc and Chevron – this year pumped 86% of the region’s 1.6 million barrels per day (bpd), up about 11 percentage points since 2017, data from regulator Bureau of Safety and Environmental Enforcement (BSEE) shows.

Royal Dutch Shell, among others, plans on increasing its investment in offshore. U.S. permitting of projects have not been affect by the Biden administration’s review, executives said.

The U.S. Gulf oilfields, with their proximity to onshore refineries and gas processing plants, are “the closest thing the energy industry has to farm-to-table” restaurant, said Bill Langin, Shell’s senior vice president of deepwater exploration.

Additional reporting by Jessica Resnick-Ault in New York; editing by David Gregorio

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