MMS reports $148.7 million in apparent high bids in GOM Lease Sale 187

By OGJ editors

HOUSTON, Aug. 20 -- Apparent high bids totaling $148.7 million were offered for 335 offshore tracts at Lease Sale 187 for the western Gulf of Mexico, the US Minerals Management Service reported Wednesday from New Orleans.

MMS officials received 407 bids totaling $258.7 million from 63 companies at the sale. This compares with the receipt of $151.3 million in apparent high bids out of a total $181.6 million bid by 44 companies on 323 of the 4,102 tracts offered in the western gulf this time last year (OGJ Online, Aug. 21, 2002).

The latest sale offered 3,996 blocks up for sale covering 21.7 million acres in the western gulf's Outer Continental Shelf planning area off Texas and in deeper waters off Louisiana. The offered blocks are 14-357 km offshore in 8-3,000 m of water.

The proposed sale could result in an estimated production of 136-262 million bbl of oil and 0.81-1.44 tcf of natural gas, MMS said.

Sale statistics
MMS statistics released shortly after the sale revealed that both major oil and gas companies and independent exploration and production firms were equally active participants in the sale.

LLOG Exploration Offshore Inc. submitted the highest single bid of $22.6 million for High Island Block 170, which lies in less than 199 m of water. The second highest single bid was submitted by a group led by Dominion Exploration & Production Inc. for Garden Banks Block 292. Dominion E&P, which submitted the bid on behalf of itself and Nexen Petroleum Offshore USA Inc., bid close to $5.4 million for the tract in 400-799 m of water. Dominion E&P also held the third highest spot for its $3.3 million bid on a tract in the High Island area.

Based on the number of total apparent high bids submitted, Amerada Hess Corp. topped the list with 59 bids totaling nearly $15.7 million. The company in second place, BHP Billiton Petroleum (Deepwater) Inc., submitted a total of 56 apparent high bids totaling almost $8.2 million.

Kerr-McGee Oil & Gas Corp., a unit of Kerr-McGee Corp., and partners reported being apparent high bidders on 19 deepwater leases with a total net exposure of $6.2 million for all high bids.

"These leases will increase our acreage inventory in the deepwater Gulf of Mexico from which we can generate and highgrade drillable prospects," said David A. Hager, senior vice-president, oil and gas. "We have acquired satellite opportunities to our existing infrastructure, as well as new field wildcat prospects in this lease sale," Hager added.

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