The US Bureau of Ocean Energy Management’s western Gulf of Mexico Lease Sale 233 offshore Texas netted $102,351,712 in apparent high bids—less than the first two sales in the Obama administration’s Outer Continental Shelf oil and gas leasing program for 2012–17.
Twelve offshore companies submitted 61 bids for 53 tracts covering 301,006 acres. Nearly 21 million acres were available for oil and natural gas exploration and development.
The 5-year program makes available for exploration and development all of the offshore areas with the highest conventional resource potential that together include more than 75% of the nation’s undiscovered, technically recoverable offshore oil and gas resources. In March, a 39-million-acre central gulf offering netted almost $1.2 billion in apparent high bids (OGJ, Apr. 1, 2013, p. 36) and in November 2012, a 20-million-acre western gulf offering netted just $134 million (OGJ Online, Nov. 29, 2012).
“The cost impacts to industry of continued changes to the regulatory system, such as the newly proposed production systems safety rule and the upcoming [blowout preventer] rule, could have figured into how companies bid in today’s western planning area sale, as did the current low price companies can fetch for natural gas,” said Randall Luthi, president of the National Ocean Industries Association.
Lease Sale 233 offered all unleased and nonprotected areas in the western gulf planning area, including 3,864 tracts, 9-250 miles offshore, in 16-10,975 ft of water. BOEM estimates the lease sale could result in the production of 116-200 million bbl of oil and 538-938 bcf of gas.
ConocoPhillips Co. submitted the highest bid on a single tract—$30,583,560—for Alaminos Canyon Block 475. Chevron USA Inc. submitted the next two highest bids: $19,102,687 and $13,111,191 for East Breaks Blocks 499 and 500, respectively. ConocoPhilips also submitted the highest total amount in bonus bids, totaling $50,323,180 on 29 tracts. Chevron submitted the second-highest total amount at $32,323,180 with just three bids, while Maersk Oil Gulf of Mexico Two LLC placed third at a total of $6,823,281 in seven bids.
BOEM received at least one bid within the three statute mile boundary area north of the OCS boundary between the US and Mexico. Any bids submitted on blocks in the area will not be opened until on or before 30 days following the approval by Congress of the agreement between the US and Mexico or Feb. 28, 2014, at which time the Interior secretary may determine whether it is in the best interest of the US either to open any such bids or to return the bid unopened.