^Oil Rush Hits Gulf of Mexico<< MORGAN CITY, La. (AP) _

The Gulf of Mexico is in the midst of a second oil rush _ one made possible by platforms the size of football fields that drill for oil at previously unimaginable depths and supercomputers that locate once-invisible reserves. The explosion of activity in the Gulf has been largely unheralded as the U.S. oil giants pursue higher-profile opportunities in Russia and an Alaska arctic refuge. Just a few years ago, the Gulf was written off as being played out. The new discoveries promise by every measure a significant boost to the sagging oil exploration industry and the possibility of reducing the nation's reliance on imports. ``Overall it could be larger than Prudhoe Bay (the 12 billion-barrel Alaska deposit),'' said Richard Pattarozzi, head of deep-water operations for Shell Offshore Inc. ``It's a significant amount of oil.'' Shell, Texaco, Amoco and Exxon are pouring billions of dollars into new exploration and drilling in waters once considered too deep for development and in regions where oil was hidden beneath massive layers of salt. The early results are remarkable. Thirty-five discoveries have been made in depths greater than 1,500 feet, with the potential for 3.5 billion barrels of new oil, industry executives say. Until recently, most oil wells in the Gulf were drilled at depths of several hundred feet. According to Interior Department and industry estimates, there could be as much as 18 billion barrels of oil and natural gas equivalent in the deep waters just outside the Continental Shelf from Texas to Alabama. Ten oil companies have staked out 1,600 deep-water leases in the Gulf. Of the 35 confirmed deep-water discoveries, 19 are owned exclusively or in part by Shell. The rental price for scarce deep-water exploratory drilling rigs soared from $40,000 a day just three years ago to $100,000. ``There are only 22 rigs in the world capable of drilling in those depths, and all of them are under contract,'' said Bruce Applebaum, manager of Texaco's offshore division. His company recently announced a $100 million lease for a major deep-water drilling ship to guarantee availability for the next three years. The race to stake new claims has given an economic boost to coastal cities hit hard when the last Gulf oil boom ended. At J. Ray McDermott Co. in Morgan City, a backlog runs well into next year for drilling platforms. ``I could put on 200 more people, but I can't find them,'' said Donald Patureau, superintendent at the company's fabrication yard. The intense competition for new government oil leases reminds some of the boom years of the early 1980s. ``We have been inundated with paperwork from companies asking for new plans to drill,'' said Chris Oynes, regional director of the federal Minerals Management Service in New Orleans. A year ago, oil executives in business suits braved a killer storm and even waded shoulder deep in flood waters to a government auction where they put down $307 million for Gulf oil leases, three times what the government expected. Last September's sales also were brisk, and officials expect strong interest in another lease auction later this spring. While welcome news to an industry that lost 450,000 U.S. jobs over the past decade, the resurgence in the Gulf is as much a technological revolution as an oil story. Supercomputers and three-dimensional seismic surveys now allow companies to find oil that only a few years ago lay camouflaged beneath massive layers of salt. And new engineering technologies _ such as Shell's ``tension leg platform'' that one day may be used to drill in water 1.5 miles deep _ are making it almost commonplace to drill and draw oil in depths previously dismissed as impossible. In the McDermott Yard, welders recently completed work on a 36,500-ton platform to be installed in 2,933 feet of water at a discovery called Mars, 130 miles southeast of New Orleans. The platform was scheduled to begin its way into the sea any day. Shell geologists estimate the site could reap as much as 700 million barrels of oil and gas equivalent. A second platform is near completion for a site 3,200 feet deep, 80 miles south of Mobile, Ala. A third project at 4,000 feet is being planned. Each is expected to cost $1 billion or more for Shell and its partners, including British Petroleum, Amoco and Exxon. Last year Texaco, an acknowledged late arrival in the Gulf resurgence, announced three successful deep-water oil discoveries, including one in water 4,243 feet deep 150 miles offshore. Two years ago, Shell, which holds a third of the deep-water leases, stunned the industry by producing a near gusher at its Auger wells, drilled in 2,860 feet of water, the deepest development wells ever in the Gulf. By last year, producing 60,000 barrels a day, it had confirmed that deep-water exploration was here to stay. Meanwhile, interest in shallow waters also has surged with the new salt-piercing computer technology. About half the offshore seabed is covered by salt layers, so the potential for new oil discoveries is enormous, experts say. In the past years, three major oil discoveries below salt fields have been declared commercially viable with each expected to hold 100 million barrels or more of oil or equivalent natural gas _ major finds by industry standards. The first was a joint venture called Mahogeny, about 75 miles of the Louisiana coast, owned by Phillips Petroleum, Anadarko and Amoco. Last year Shell and two partners announced a $240 million effort to develop a subsalt field called Enchilada, and Texaco unveiled its own subsalt project, Gemini, this one in almost 3,400 feet of water. No one knows how deep the developments eventually will go. A consortium of four oil companies _ Shell, Mobil, Texaco and Amoco _ announced last month exploratory drilling 200 miles off the Texas coast in a depth of 7,625 feet, the deepest water in which anyone has ever tried to prospect for oil. ``The ultimate question is how far can you take this technology,'' Shell's Pattarozzi said. ``We still don't have an answer to that.'' (PROFILE (CO:Texaco Inc; TS:TX; IG:OIL;) (CO:Amoco Corp; TS:AN; IG:OIL;) (CO:Exxon Corp; TS:XON; IG:OIL;) (CO:J Ray McDermott SA; TS:JRM;) (CO:British Petroleum Co Ltd; TS:BP; IG:OIL;) (CO:Phillips Petroleum; TS:P; IG:OIL;) (CO:Mobil Corp; TS:MOB; IG:OIL;) (CAT:Business;) (CAT:Energy;) ) AP-NY-04-29-96 1253EDT<