Lease Sale 247 yields more than $274 million in high bids

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BeaubouefBruce Beaubouef Houston

Lease Sale 247 yields more than $274 million in high bids

The Bureau of Ocean Energy Management (BOEM) reports that Lease Sale 247 garnered $274,797,434 in high bids for 163 tracts covering 913,542 acres in the Central Gulf of Mexico planning area.

Twenty-eight offshore oil and gas companies submitted 189 bids. The sum of all bids received totaled $315,303,884.

Shell Offshore Inc. submitted 20 high bids totaling $55,856,380. Its and the sale’s highest bid, $24,056,719, was for Atwater Valley block 64.

Statoil Gulf of Mexico LLC submitted 13 high bids totaling $44,500,688. Its highest bid, $21,237,976, was for Walker Ridge block 55.

Hess Corp. submitted 12 high bids totaling $43,873,740. Its highest bid, $18,327,777, was for Green Canyon block 287.

Chevron U.S.A. Inc. submitted 20 high bids totaling $35,566,603. Its highest bid, $11,307,829, was for Green Canyon block 642.

Exxon Mobil Corp. submitted 19 high bids totaling $21,910,475. Its highest bid, $5,275,025, was for Green Canyon block 250.

Anadarko US Offshore LLC submitted 16 high bids totaling $18,941,629. Its highest bid, $5,134,285, was for Mississippi Canyon block 41.

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With Lease Sale 247, the BOEM offered 9,118 unleased blocks, covering 48 million acres offshore Louisiana, Mississippi, and Alabama. (Courtesy Bureau of Ocean Energy Management)

TOTAL E&P USA, Inc. submitted four high bids totaling $15,000,000. Its highest bid, $12,600,227, was for Garden Banks block 1006. This block received the highest number of bids (five).

Other high bidders included:

  • Walter Oil & Gas Corp. submitted four high bids totaling $6,268,088.
  • Ridgewood Energy Corp. submitted eight high bids totaling $4,773,962.
  • LLOG Exploration Offshore, L.L.C. submitted four high bids totaling $3,279,524.
  • Houston Energy, L.P. submitted nine high bids totaling $2,082,090.
  • Talos Energy Offshore LLC submitted six high bids totaling $2,319,000.
  • Red Willow Offshore, LLC submitted six high bids totaling $1,489,454.

Each bid will go through a 90-day evaluation process to ensure the public receives fair market value before a lease is awarded.

BOEM offered 9,118 unleased blocks, covering 48 million acres, located from 3 to 230 nautical miles (5 to 370 km) offshore Louisiana, Mississippi, and Alabama, in water depths ranging from 9 to more than 11,115 ft (3 to 3,400 m).

This is the final lease sale to be held in the Gulf of Mexico under the current Outer Continental Shelf Oil and Gas Leasing Program for 2012-2017. BOEM estimates the lease sale could result in the production of 460 to 890 MMbbl of oil and 1.9 to 3.9 tcf of natural gas.

As of March 1, 2017, about 16.9 million acres on the US OCS are under lease for oil and gas development (3,194 active leases) and 4.6 million of those acres (929 leases) are producing oil and natural gas. More than 97% of the leases are in the Gulf of Mexico; about 3% are on the OCS off California and Alaska, according to BOEM.

US Secretary of the Interior Ryan Zinke said: “Today’s strong sale reflects continued industry optimism and interest in the Gulf’s outer continental shelf, a keystone of the nation’s offshore oil and gas resources and a vital part of President Trump’s plan to make the United States energy independent.”

The results of the lease sale were promising, said NOIA President Randall Luthi. The results “not only reflect an improving offshore oil and gas market, but also optimism for increased opportunities for offshore leasing, exploration and development under the Trump administration.”

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