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* Shenandoah field could be double or triple previousestimates
* Find latest in string of potentially huge fields
* Company aims to continue appraisals
* Anadarko shares rise 3.7 pct
By Kristen Hays
HOUSTON, March 20 (Reuters) - Anadarko Petroleum Corp's latest well results in its Shenandoah field in the Gulfof Mexico is a potentially huge find among a string of bigdiscoveries that illustrate the prolific basin's importance toU.S. crude output, analysts said on Wednesday.
Results of Anadarko's Shenandoah-2 appraisal well, whichtested how much oil could be in the field, showed the reservoircould be more than two or three times larger than the company'sestimate of more than 300 million barrels of oil, analysts said.
Pressure and log data from the well also show Anadarko couldpotentially recover a higher percentage of oil from theShenandoah field than in other areas of the vast Lower Tertiarytrend, the Gulf's deepest, most challenging and most promisingplay, estimated to hold up to 15 billion barrels of oil.
"The deepwater Gulf of Mexico is witnessing an astonishingrun of discoveries and hydrocarbon augmentation," Simmons & CoInternational said in a note to investors on Wednesday.
"Quite a renaissance from the depths of Macondo," Simmonssaid, referring to BP Plc's doomed well that ruptured in2010 and spewed more than 4 million barrels of oil into theGulf.
Other notable well results on discoveries in the LowerTertiary since 2010, according to Simmons, include Exxon MobilCorp's Hadrian field with an estimated 700 millionbarrels of oil; Chevron Corp's Moccasin field with anestimated 200 million barrels of oil equivalent (boe); and RoyalDutch Shell's Appomattox field with an estimated 500million boe.
BP also estimates that its Mad Dog field could have up to 4billion boe, up from 1.5 billion boe. Construction on a secondoil and gas platform for the field is slated to start by the endof this year.
Such finds show that deepwater exploration and production,where wells can cost more than $130 million each to drill tensof thousands of feet through thick salt and rock layers, remainscritical to U.S. production, even alongside booming onshore oiloutput in North America, analysts said.
"The opportunity is vast as deepwater reserves currentlycomprise about 10 percent of global oil reserves," Simmons said.
About 29 percent of U.S. crude output came from the Gulf in2009. Last year it had fallen to 23 percent as onshoreproduction from tight oil and shale oil grew substantially.
'MASSIVE'
Anadarko said its Shenandoah-2 well, about 200 miles (322km) south of the Louisiana coastline, showed more than 1,000feet (305 meters) of net oil pay, meaning the drill pierced1,000 feet of productive oil-bearing rock without having tappedany water. Exxon's Hadrian North well had a similar result.
"It's massive. One thousand feet's big, it's world class,"said David Pursell, an analyst with Tudor Pickering Holt & Co inHouston who also is a petroleum engineer.
Anadarko's previous Shenandoah discovery well in 2009 showedabout 300 feet (91 meters) of net oil pay, Capital OneSouthcoast said in a note to investors on Wednesday.Shenandoah-2's results prompted Capital One to increase itsestimate of how much oil could be in the field to 900 millionboe from 225 million boe.
"This is an exciting story and far from over as we awaitresults from two other wells," Capital One said.
Pursell also noted that Anadarko said well results show"reservoir and fluid properties" that indicate it could showbetter recovery rates - or more oil will flow - than in otherareas of the Lower Tertiary.
"Basically, they're saying that relative to the LowerTertiary, not only is there a lot of oil here, but thereservoir's pretty good too," he said.
Anadarko anticipates more appraisal drilling "to advancethis potentially giant project," according to Bob Daniels,senior vice president of deepwater and internationalexploration.
Anadarko shares closed up $3.12 or 3.75 percent at $86.40 onWednesday.
