Rystad Energy Outlook: U.S. Deepwater Production set for Record Output in 2026

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The Gulf of America (GoA) has witnessed an outstanding 2025 in terms of startup activity. Three new floating production units (FPU) are set to begin operations by year-end, with the potential to drive the basin’s deepwater output to an all-time high of nearly 2.2 million barrels of oil equivalent per day (boepd) in 2026.

The year started with a bang when Shell brought its Whale FPU on-line in January, reportedly achieving peak oil production rates of 100,000 barrels per day (bpd) within five months. Private operator Beacon Offshore Energy set a record of its own in July with the start of its Shenandoah project, the second to produce from the Inboard Wilcox trend using so-called 20K technology designed to handle high-pressure, high-temperature (HPHT) conditions with wellhead pressures of up to 20,000 pounds per square inch (psi). That leaves the Salamanca FPU – a joint development between private operator LLOG, Spanish producer Repsol, and O.G. Oil & Gas – as the final floater startup of 2025, with output expected to begin imminently.

The Gulf has in many ways come full circle since the price crash that rattled the industry a decade ago, with the floaters of 2025 adding nearly 350,000 boepd of nameplate processing capacity (Figure 1). This represents the highest capacity additions since 2015, when Anadarko Petroleum brought the Heidelberg and Lucius truss spars on-line and LLOG fired up its Delta House FPU in the Mississippi Canyon.

While floaters have dominated the headlines, four new subsea tiebacks have also commenced operations in 2025 with material growth prospects going into 2026. Chevron’s Ballymore development – which targets the high-temperature Norphlet trend and ties back to the major’s Blind Faith FPU – is the largest of the four, while Shell’s nearby Dover field will provide around 20,000 boepd of backfill production to the Appomattox FPU. Meanwhile, BP in August announced early startup of its Argos Southwest Extension project, a three-well tieback with estimated peak rates of 20,000 bpd.

All in all, the peer group of 2025 Gulf of America startups is set to add 350,000 boepd in 2026-2027, with new FPU projects accounting for around 70% of total near-term volume (Figure 2). Arguably more significant is that the class of 2025 is forecast to account for between 15% and 18% of total US deepwater output, representing the highest sustained production contributions from a single startup year since 2009.

The next five years will see significant new commissioning activity with the likes of FPU-based projects such as Sparta, Kaskida and Tiber – all of which target more challenging Lower Tertiary reservoirs. More regular leasing and the initial results from multi-client ocean bottom node (OBN) seismic surveys may also set the stage for new discoveries as US deepwater players refill their exploration hoppers. For now, though, 2025 is shaping up to be a standout year for the Gulf, with few parallels in the recent past or near future.

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