$850m in high bids offered on Central Gulf lease sale

Oil+rig20 March 2014, News Wires – Oil and gas operators offered over $850 million in high bids for 326 tracts covering more than 1.7 million acres in Wednesday’s central Gulf of Mexico Lease Sale 231.

The Bureau of Ocean Energy Management (BOEM), part of the U.S. Department of the Interior, offered almost 40 million acres in the central and eastern Gulf. Fifty operators participated in central Gulf Lease Sale 231, offering 380 bids totaling over $1.08 billion.

BOEM offered 7,511 tracts encompassing over 39 million acres in the sale. BOEM Director Tommy P. Beaudreau said the lease sale could result in the production of 1 billion barrels of oil and 4 trillion cubic feet of gas.

“While domestic energy production is growing rapidly in the United States, the central Gulf of Mexico, as demonstrated by today’s lease sale, will continue to be one of the cornerstones of the nation’s energy portfolio,” he said. “The Gulf of Mexico is one of the most productive basins in the world, and the Obama administration supports the development of our nation’s offshore oil and gas resources in the Gulf of Mexico while protecting the human, marine and coastal environments, and ensuring a fair return to the American people,”

Beaudreau commented. Freeport-McMoRan Oil & Gas LLC offered $68.7 million on Atwater Valley Block 198, the highest bid made on a block and the highest bid per acreage.

This block received six bids, the greatest number of bids made on any block offered.  Freeport-McMoRan submitted five of the top 10 single highest bids in the sale. Chevron Corp. subsidiary Chevron U.S.A. Inc. and Royal Dutch Shell plc also submitted single highest bids; Murphy and Ecopetrol America Inc. jointly submitted a top ten single highest bid.

BP plc, which became eligible again to bid on deepwater leases following its settlement with the U.S. Environmental Protection Agency over the Deepwater Horizon incident earlier this month, made 24 high bids totaling $41.6 million in the sale, making BP fourth on the list of top ten companies based on high bids submitted.

Cobalt International Energy LP made 44 high bids totaling $25.8 million, the greatest number of high bids made by any company participating in the sale.

Total E&P USA Inc., LLOG Bluewater Holdings LLC and GulfSlope Energy Inc. also ranked among the top five of the top ten companies in number of high bids. Other companies rounding out the top ten for number of high bids include EPL Oil & Gas Inc., Houston Energy L.P., Apache Shelf Exploration LLC, Freeport-McMoRan and Murphy Exploration & Production Company.

Lloyd Ridge Block 457 in 10,049 feet (3,063 meters) of water was the deepest block to receive a bid in Lease Sale 231. Of the 326 bids made, 131 were for blocks in less than 656 feet (200 meters) of water, and 108 were made on blocks in over 5,249 feet (1,600 meters) of water.


– Rigzone

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