The NewsRoom
Release: #3783
Date: February 12, 2008
RIK Sale’s
Gross Expected to Top $362 Million
More Than 4.2
Million Barrels of Royalty Oil Sold
DENVER
– More than 4.2 million barrels of Royalty in Kind (RIK) crude oil
and condensate from Federal leases in the Gulf of Mexico and Pacific
Ocean have been sold to six companies as part of an RIK sale, the
Department of the Interior’s Minerals Management Service (MMS)
announced today. The sale is expected to gross a total of more than
$362 million.
The contracts
awarded as part of the January sale will provide for approximately
4,264,500 barrels of crude oil, or 29,050 barrels per day over terms
of the contracts. Delivery is scheduled to begin April 1, 2008, and
end June 30, 2008, with the exception of one package from the
Pacific Ocean that was awarded for one year.
The crude oil
will convert to more than 174 million gallons of petroleum products,
including gasoline, diesel fuel, heating oil, jet fuel, heavy fuel
oil, and other products. Crude oil of this quality on the open
market currently has an $85 per barrel price; based on that price
the total sales would amount to approximately $362.5 million.
The sale was
conducted as part of the MMS’s Royalty in Kind Program, which allows
MMS to take its royalties “in kind,” in the form of product, instead
of “in value,” in the form of a cash payment. The MMS then
competitively sells the product in the open marketplace to ensure a
fair return on the public’s royalty assets, improve government
efficiencies, reduce regulatory costs and reporting requirements,
and shorten the compliance cycle.
Those companies
submitting winning bids include Chevron Products Company,
ConocoPhillips, ExxonMobil Oil Corp., Sempra Trading, Shell Trading
U.S. Company, and Plains Marketing, LP.
Media Contact:
Patrick Etchart
303-231-3162
MMS: Securing Ocean Energy & Economic Value for America
U.S. Department of the Interior
Privacy |
Disclaimers |
Accessibility |
Topic Index | FOIA
Last Updated:
05/27/2008,
04:05 PM
Central Time
|