Freeport-McMoRan Inc.’s (NYSE: FCX) Horn Mountain Deep well in the deepwater Gulf of Mexico has hit oil.

Initial production from this well, which will be tied back to existing facilities, is expected in first half 2017. This well, combined with two follow-on development wells at Horn Mountain Deep, may be capable of producing an aggregate of 30,000 barrels of oil equivalents per day (boe/d).

During September 2015, the Horn Mountain Deep well was drilled to a total depth of about 16,925 feet. Logging while drilling logs indicated that the well encountered a total of about 142 net feet of Middle Miocene oil pay with excellent reservoir characteristics. In addition, these results indicate the presence of sand sections deeper than known pay sections in the field.

The 100-percent-owned Horn Mountain production facilities in Freeport-McMoRan’s Mississippi Canyon area are capable of processing 75 Mbbls of oil per day. The positive results at Horn Mountain Deep and geophysical data support the existence of prolific Middle Miocene reservoir potential for several additional opportunities in the area, including the 100-percent-owned Sugar, Rose, Fiesta, Platinum and Peach prospects. Freeport-McMoRan controls rights to over 55,000 acres associated with these prospects.

Since commencing development activities in 2014 at its three 100-percent-owned production platforms in the Deepwater GOM, Freeport-McMoRan has drilled 12 wells, all with positive results. Three of these wells have been brought on production, and Freeport-McMoRan plans to complete and place the remaining additional wells on production in late 2015, 2016 and 2017.

The success at Horn Mountain Deep follows the positive drilling results announced in July 2015 from three wells drilled in the Horn Mountain area, including the Quebec/Victory (QV), Kilo/Oscar (KO) and Horn Mountain Updip tieback prospects. In aggregate, these wells may be capable of producing over 27,000 boe/d, with initial production expected in mid-year 2016.

Also during the third quarter of 2015, Freeport-McMoRan drilled its second successful development well at its 100-percent-owned King Field, located in Mississippi Canyon south of the 100-percent-owned Marlin facility in 5,200 feet of water. A third development well is in progress. In aggregate, these wells may be capable of producing 20,000 boe/d, with initial production expected to commence in the fourth quarter of 2015. Freeport-McMoRan’s Marlin production facilities in the Mississippi Canyon focus area are capable of processing 60 MBbls of oil per day.

Completion activities of the previously drilled three-well program at the 100-percent-owned Holstein Deep field are progressing on schedule with first production expected by mid-year 2016. In aggregate, the three wells are estimated to commence production at approximately 24,000 BOE/d. A fourth well is being planned as part of the second phase of the Holstein Deep program. Freeport-McMoRan’s Holstein production facilities in the Green Canyon focus area are capable of processing 113 Mbbls of oil per day.

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