The NewsRoom
www.doi.gov
Date: March 19, 2008
Oil and Gas Lease Sales in Gulf of Mexico
Attract $3.7 Billion
Sales Launch Enhanced Revenue Sharing
Program, Increased Royalty Rates;
Sale 206 Sets Record for Highest Total in High Bids
NEW ORLEANS –
Two federal sales of offshore oil and natural gas leases in the
Eastern and Central Gulf of Mexico attracted more than $3.7 billion
in high bids today, inaugurating enhanced revenue sharing with oil
and gas producing Gulf states, instituting higher royalty rates and
underscoring the region’s continuing importance as a vital source of
domestic energy production for the nation.
The first sale, the Central Gulf
of Mexico Sale 206, attracted a record-setting $3,677,688,245 in
high bids. This sets the record in high bids in U.S. leasing
history since area-wide leasing began in 1983.
“Today’s lease sales mark an
important milestone in sharing substantially increased revenue from
offshore oil and gas development with states willing to support it,”
said Secretary of the Interior Dirk Kempthorne, who opened the lease
sales and announced the high bid totals.
“Beginning with Lease Sale 224,
Louisiana, Mississippi, Alabama and Texas will receive a greater
share in all these revenues, including bids, rental payments and
royalties,” Kempthorne said. “These states will
share in 37.5 percent
of the high bids from today’s sale and
all future revenues generated from the
acreage leased today.”
For Central Gulf of Mexico Sale 206, Interior’s Minerals Management
Service, which conducted the sales, received 1,057 bids from
85 companies on 615 tracts resulting in a record $3,677,688,245 in
high bids.
For Eastern Gulf of Mexico Sale
224, MMS received 58 bids from 6 companies on 36 tracts resulting
in $ 64,713,213 in high bids with an estimated 37.5 percent of that
amount going directly to four Gulf producing States.
“Today’s sales emphasize the
Gulf’s strategic value for America’s energy security and the
significant economic benefits of environmentally safe oil and gas
production for the nation and the Gulf of Mexico oil and gas
producing states,” said Randall Luthi, Director of the Minerals
Management Service.
Eastern Sale 224
Lease Sale 224 encompasses 118 whole or partial unleased blocks
covering 546,971 acres in the Eastern Planning Area. The acreage is
located 125 statute miles and greater offshore, south of the Florida
panhandle and west of the Military Mission Line in water depths
ranging from 2,657 feet (810 meters) to 10,213 feet (3,113 meters).
Eastern Sale 224 is the first sale where the revenue sharing
provisions of the Gulf of Mexico Energy Security Act of 2006 start
immediately. The states of Alabama, Mississippi, Louisiana, and
Texas will share in 37.5 percent
of the high bids on whole and partial
blocks in the Eastern Planning area. These four Gulf
producing States will also share in 37.5 percent of all future
revenues generated
from the acreage leased today in the Eastern Planning Area.
The enhanced revenue sharing program was mandated by
the Gulf of Mexico Energy Security Act of 2006. No royalty relief
will be issued with these leases. With Central Gulf of Mexico Lease
Sale 206, the royalty rate for blocks in all Gulf of Mexico water
depths is increased to 18 3/4 percent from 16 2/3 percent.
In addition, 12.5 percent of revenues from today’s
lease sales will be deposited into the Land and Water Conservation
Fund for use by states to enhance parklands and for other
conservation projects. “This is significant because as we deplete
a natural resource, it is important that we also invest in our natural resources,” Kempthorne
said.
Lease Sale 224 is the only sale scheduled to be held in the Eastern
Gulf of Mexico under the current Five Year Outer Continental Shelf
Oil and Gas Leasing Program.
The acreage included in this Eastern GOM Lease Sale
224 was last available for lease in 1988.
“The new revenue sharing provision will provide funds to help the
four Gulf producing States meet the educational, environmental and
infrastructure needs of their communities,” noted Luthi.
Central Sale 206
The sale
offered 5,569 tracts comprising about 29.8 million acres in federal
areas offshore Louisiana, Mississippi, and Alabama. The acreage is
located from three to 230 miles offshore in water depths of about 10
feet (three meters) to more than 11,200 feet (3,400 meters).
Approximately 34 percent of the
tracts receiving bids in this sale are in ultra-deep water -- more
than 5,249 feet (1,600 meters). The deepest tract to receive a bid
is Lloyd Ridge, Block 286 in 3,076 meters of water. The highest bid
received on a block was $ 105,600,789 submitted by Anadarko E&P
Company LP, Murphy Exploration & Production Company – USA, Samson
Offshore Company for Green Canyon Block 432.
“MMS expected continued strong
interest from industry in the deepwater and ultra-deepwater areas of
the Central Gulf,” said Luthi. “This high level of interest is
being sustained by the information gained through new discoveries
and the advancements in deepwater technology.”
Bid Evaluation – Fair
Market Value
Before a lease is awarded, each
high bid on a block will go through a thorough evaluation process by
the Minerals Management Service to ensure that the public receives
fair market value.
Currently there are more than
7,000 leases in the Gulf that account for 25 percent of the Nation’s
domestically produced oil and 15 percent of the domestically
produced natural gas. More than 30,000 jobs are directly related to
Gulf energy exploration and production.
Sale Highlights: Central Sale 206
The top five companies submitting the
highest dollar amount of high bids for Sale 206: |
Company |
Number of High Bids Submitted |
Sum of High Bids Submitted |
Hess Corporation |
25 |
$437,541,152 |
Cobalt International Energy, L.P. |
36 |
$389,056,079 |
BP Exploration & Production Inc. |
63 |
$336,575,445 |
ConocoPhillips Company |
20 |
$323,891,298 |
Chevron U.S.A. Inc. |
49 |
$240,987,863 |
The top five companies submitting the
highest number of high bids for Sale 206: |
Company |
Number
of Total Bids
Submitted |
Sum of
Total Bids Submitted |
BP
Exploration & Production Inc. |
63 |
$336,575,445 |
Chevron
U.S.A. Inc. |
49 |
$240,987,863 |
BHP
Billiton Petroleum (Deepwater) Inc. |
42 |
$ 95,652,498 |
Cobalt
International Energy, L.P. |
36 |
$389,056,079 |
Devon
Energy Production Company, L.P. |
35 |
$ 94,795,020 |
The top five companies submitting the
highest dollar amount of total bids for Sale 206: |
Company |
Number
of Total Bids
Submitted |
Sum of
Total Bids Submitted |
Hess
Corporation |
42 |
$531,196,402 |
Cobalt
International Energy, L.P. |
65 |
$450,798,265 |
Chevron
U.S.A. Inc. |
79 |
$444,465,426 |
ConocoPhillips Company |
36 |
$422,953,500 |
BP
Exploration & Production Inc. |
94 |
$417,299,744 |
The top five bids for Sale 206: |
Company |
Area
and Block Number
|
Amount
of Bid |
Anadarko E
& P Company LP
Murphy
Exploration & Production Co. –USA
Samson
Offshore Company |
Green
Canyon/432 |
$105,600,789 |
Marathon
Oil Company
Hess
Corporation |
Walker
Ridge/226 |
$ 93,024,910 |
Cobalt
International Energy, L.P. |
Green
Canyon/858 |
$ 85,418,889 |
Chevron
U.S.A. Inc. |
Green
Canyon/945 |
$ 81,063,073 |
Cobalt
International Energy, L.P. |
Keathley
Canyon/163 |
$ 74,418,889 |
Eastern Sale
224 The top five companies submitting the highest dollar amount
of high bids for Sale 224: |
Company |
Number
of High Bids Submitted |
Sum of
High Bids Submitted |
BHP
Billiton Petroleum (Deepwater) Inc. |
27 |
$47,858,420 |
Anadarko
E&P Company LP |
7 |
$12,754,728 |
Murphy
Exploration & Production Company |
7 |
$ 3,188,682 |
Eni
Petroleum US LLC |
1 |
$
527,006 |
Shell
Offshore Inc |
1 |
$
384,377 |
The top five companies submitting the
highest number of high bids for Sale 224: |
Company |
Number
of Total Bids
Submitted |
Sum of
Total Bids Submitted |
BHP
Billiton Petroleum (Deepwater) Inc. |
27 |
$47,858,420 |
Anadarko
E&P Company LP |
7 |
$12,754,728 |
Murphy
Exploration & Production Company |
7 |
$ 3,188,682 |
Eni
Petroleum US LLC |
1 |
$
527,006 |
Shell
Offshore Inc. |
1 |
$
384,377 |
The top five companies submitting the
highest dollar amount of total bids for Sale 224: |
Company |
Number
of Total Bids
Submitted |
Sum of
Total Bids Submitted |
BHP
Billiton Petroleum (Deepwater) Inc |
27 |
$47,858,420 |
Anadarko
E&P Company LP |
9 |
$13,168,160 |
Murphy
Exploration & Production Company |
9 |
$ 3,292,040 |
Eni
Petroleum US LLC |
9 |
$ 2,957,665 |
Shell
Offshore Inc. |
4 |
$ 2,796,508 |
The top five bids for Sale 224: |
Company |
Area
and Block Number
|
Amount
of Bid |
Anadarko
E&P Company LP
Murphy
Exploration & Production Co. -USA |
Lloyd
Ridge/289 |
$8,049,750 |
BHP
Billiton Petroleum (Deepwater) Inc |
De Soto
Canyon/680 |
$5.285,555 |
BPH
Billiton Petroleum (Deepwater) Inc |
De Soto
Canyon/681 |
$5,285,555 |
BPH
Billiton Petroleum (Deepwater) Inc |
De Soto
Canyon/725 |
$5,285,555 |
BHP
Billiton Petroleum (Deepwater) Inc |
De Soto
Canyon/726 |
$5,285,555 |
More information is available
online at
www.mms.gov.
Contact:
Chris Paolino 202-208-6416
Caryl Fagot 504-736-2590
Eileen Angelico
504-736-2595
MMS: Securing Ocean Energy & Economic Value for America
U.S. Department of the Interior
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Last Updated:
05/27/2008,
03:40 PM
Central Time
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