Largest domestic source of oil discovered in Gulf of Mexico

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Chevron says Gulf drilling a success

Well could become the nation's biggest new domestic source of oil, according to newspaper report.

September 5 2006: 10:37 AM EDT

NEW YORK (Reuters) -- Chevron Corp. said Tuesday it had successfully drilled for oil in the Gulf of Mexico's deep waters, in what could be one of the most significant finds for the domestic oil industry in a generation.

The successful well, known as Jack 2, reached a record total depth of 28,175 feet, coming in 7,000 feet of water, and more than 20,000 feet under the sea floor. Analysts said the find suggested the success of that drilling may mean more oil than previously believed is available under the Gulf of Mexico, a region that already provides a quarter of U.S. output.

One published report suggested the breakthrough could increase U.S. oil reserves by as much as 50 percent.