W&T Offshore CEO Tracy Krohn believes the company’s Mahogany Field in the U.S. Gulf of Mexico (GoM) has an additional 100 million barrels of reserves that is not on the books.

“This change alone would more than double [W&T’s] current proved reserves of 84 MMboe,” analysts with Seaport Global Securities said in a note.

The head of the GoM-focused company shared his thoughts while speaking at the EnerCom Oil and Gas Conference, which was live-streamed, earlier this week. His words were delivered as offshore operators continue improving economics, uncovering more resources with infrastructure-led exploration and improved seismic capabilities.

When the Mahogany Field was discovered in 1993 by Phillips Petroleum Co. working with Anadarko Petroleum Corp. and Amoco Production Co., most of the pay sands were 15,000 ft below about 8,000 ft of salt, Krohn recalled.

W&T, which now has 100% interest in the field after continuously increasing its stake since its initial 25% acquisition in 1999, was unable to image deep in the early days. But that changed. The company brought data reprocessing in-house, using its own algorithms to get better data.

“We’re having good success,” Krohn told conference attendees. Success rates have improved from 75%-80% to more than 90%, he said, mainly due to drilling in existing fields to minimize risk.

Since 2011, the Houston-based company has substantially expanded the size and depth of the field, considered the first commercial field in the GoM’s subsalt play, by drilling and sidetracking 13 new producing locations. At least six pay zones are proven productive in the field, which is located in the GoM’s Ship Shoal area offshore Louisiana.

“Original [W&T] reservoir stats were 7.9 million barrels of probables and 22 million barrels or so of possibles. Flash forward six years, now we’re sitting on 33.6 million barrels of proved reserves, 50.8 of probable and 101.4 of possible,” Krohn said. “So, the reservoir keeps getting bigger.”

W&T’s A-14 well, drilled in 2013, logged oil pay in five zones and found the deep T-Sand. About three years later the A-18 well hit pay beneath the T-Sand in the U-Sand, according to his presentation.

The company is currently drilling the A-6ST, targeting another sand. Following that, focus at Mahogany will turn to A-12ST, which is targeting the T-Sand. W&T’s inventory of future drilling projects could exploit reservoirs in the P, Q and T through V sands, extending the reservoir’s limits.

Production from Mahogany has already ballooned to about 15,550 barrels of oil equivalent per day (boe/d)—76% liquids—from about 1,290 boe/d in 2011, the company said.

Since drilling its first well on the field, the highest known water and lowest known oil have changed as production has grown.

“We keep producing more volume so that eventually—and sooner rather than later—we’re going to see a unique situation where the reservoir engineers are going to have to admit that, yes, the lowest known oil can’t go below the highest known water,” Krohn said.

“So, then the model’s going to change. Then, I’m going to be screaming, jumping up and down. It’s going to change by about 100 million barrels, we believe,” he continued, briefly referring back to the obligatory forward-looking statement at the beginning of his presentation.

“I’ll let you digest that,” he said. “It’s a very unusual reservoir.”

Some of W&T’s other fields are also underbooked for probable and possible reserves, he added.

“Bottom line is that we’re sitting on top of about $1.6 billion of cash flow with probables and possible reserves associated with proved reserves that we don’t get credit for in the market but it comes to us in the form of cash” he said.

That could grow given W&T’s inventory of growth prospects across the GoM. This includes about 50 near-term prospects with 39 platform wells and 11 subsea tiebacks, all less than 5 miles, and an estimated P10/3P resource potential of about 170 million boe, according to Krohn’s presentation.

About six exploration and six development wells are planned for this year.

Plus, acquisitions could further expand inventory—something the company has done in the past with acquisitions from Total SA, Royal Dutch Shell Plc and Cobalt International Energy Inc. among others.

W&T grew its acreage offshore Alabama, acquiring Mobile Bay area assets from Exxon Mobil Corp. in June. The $200 million deal is expected to close by the end of August. Reserves associated with the acquisition were 74 MMboe, as of Jan. 1, with production at about 19,800 boe/d.

RELATED: W&T Offshore Makes $200 Million Acquisition Of Exxon Mobil Gulf Assets

“We see a lot of extra potential here. We expect to be drilling some wells, … and we believe we’ll find more reserves,” Krohn said, noting there hasn’t been a well drilled there in at least a decade. “It’s a nice little piece of business for us.”

Prospects here include Norphlet trend leads.

The deal, which included nine fields, also includes Exxon Mobil’s onshore treatment facility, which is northwest of W&T’s Yellowhammer facility.

“The automatic assumption is that we’re going … to drop one, and I don’t think that that’s the case,” Krohn said. “My idea is to try and create more production and fill them both up. … That’s the intent and hopefully, that’s the way it will work out.”