This is the first major discovery by BP in the region since the explosion in 2010 which killed 11 people and spilled four million barrels of oil into the sea. The oil giant has set aside more than $42 million for costs associated with the disaster, such as compensation, clean-up expenses and fines.
BP is still banned from competing for US government contracts, but if this new discovery goes without any issues it could do a lot to boost the company’s image. The Gila discovery is co-owned with ConocoPhillips, and is roughly 300 miles south-west of New Orleans. BP has stated that this year has been the most successful in almost a decade.
BP has yet to quantify how much the discovery could be worth, but it could help lift its share out of the narrow range it has been locked in. The price has managed to pull back approximately 50% of the loss since the Gulf of Mexico disaster, but while the court case over compensation continues, the stock will find it difficult to break the 500p level.