LONDON, (Reuters) – Oil major BP Plc said it has made  an oil discovery in the Gulf of Mexico, which analysts believe  could contain over 1 billion barrels of recoverable reserves,  reaffirming the Gulf’s strategic importance to the industry.

BP said in a statement yesterday that it had made the  “giant” find at its Tiber Prospect in the Keathley Canyon block  102, by drilling one of the deepest wells ever sunk by the  industry.

Further appraisal will be required to ascertain the size of  volumes of oil present, but a spokesman said the find should be  bigger than its Kaskida discovery which has over 3 billion  barrels of oil in place.

Estimates of recoverable reserves range from around 20  percent of oil in place.

“Assuming reserves in place of 4 billion barrels and a 35  percent recovery rate, BP’s proven reserves .. would rise by 868  million barrels — equivalent to 4.8 percent of the group’s  18.14 billion barrels of proven reserves,” Aymeric De-Villaret,  oil analyst at Societe Generale said in a research note.

BP, the biggest oil producer in the U.S. and biggest  leaseholder in the Gulf of Mexico, has a 62 percent working  interest in the block, while Brazilian state-controlled Petrobras    owns 20 percent and U.S. oil major ConocoPhillips owns 18  percent.

Iain Armstrong, analyst at Brewin Dolphin, said the  discovery may have implications for long-term oil prices.

“It will ease concerns about peak oil because it shows there  is life left in these mature areas,” he said, adding that it  could be the second half of the next decade before the find is  producing.

The discovery also bodes well for other exploration in that  part of the Gulf of Mexico, including at Royal Dutch Shell’s  nearby Great White field, Jason Kenny, oil analyst at ING in  Edinburgh, said.