The next frontier for offshore drilling: deepwater fracking

|By:, SA News Editor

Energy companies are taking their fracking operations from the land to the sea - the deep waters off the U.S., South American and African coast - as advances in technology and vast offshore discoveries finally have combined to make large scale deepwater fracking feasible.

The big play is in the Gulf of Mexico, where wells more than 100 miles from the coastline must traverse water depths of a mile or more and can cost nearly $100M to drill - a potential boon for oil service providers such as Halliburton (NYSE:HAL), Baker Hughes (NYSE:BHI) and Superior Energy (NYSE:SPN), and major producers such as Chevron (NYSE:CVX), Shell (RDS.A, RDS.B) and BP could reap billions of dollars over time as fracking helps boost crude output.

At sea, wastewater from fracked wells is dumped overboard into the vast Gulf, where dilution renders it harmless, companies and regulators say; but "nobody knows what they’ve been discharging and in what amounts," according to the oceans director for the Center for Biological Diversity.