Lease Sale 251 yields more than $178 million in high bids

Lease Sale 251 generated $178,069,406 in high bids for 144 tracts covering 801,288 acres in federal waters of the Gulf of Mexico.

Offshore staff

WASHINGTON, D.C.– Deputy Secretary of the Interior David Bernhardt said that Lease Sale 251 generated $178,069,406 in high bids for 144 tracts covering 801,288 acres in federal waters of the Gulf of Mexico.

Twenty-nine companies submitted 171 bids that totaled $202,667,923.

Lease Sale 251 included 14,622 unleased blocks, located from 3 to 231 mi (5 to 372 km) offshore, in the Gulf’s Western, Central and Eastern Planning Areas in water depths ranging from 9 to more than 11,115 ft (3 to 3,400 m).

Exxon Mobil Corp. submitted 25 high bids totaling $40,555,000. Its highest bid, $8,503,880, was for the ultra-deepwater De Soto Canyon block 939.

Hess Corp. submitted 16 high bids totaling $36,178,321. Its and the sale’s highest bid, $25,919,784, was for the ultra-deepwater Mississippi Canyon block 338.

Chevron U.S.A. Inc. submitted five bids totaling $18,705,332. Its highest bid, $11,116,013, was for the ultra-deepwater Mississippi Canyon block 743.

Equinor Gulf of Mexico LLC submitted 16 high bids totaling $13,224,672.

BP Exploration & Production Inc. submitted 19 high bids totaling $12,571,230.

Anadarko US Offshore LLC submitted five high bids totaling $12,481,890. Its highest bid, $3,887,975, was for the deepwater Green Canyon block 473.

Shell Offshore Inc. submitted three high bids totaling $6,305,964. Its highest bid, $4,601,988, was for the deepwater Mississippi Canyon block 978.

Total E&P Inc. submitted four high bids totaling $5,800,786. Its highest bids, $3,250,112, was for the deepwater Garden Banks block 872.

Deep Gulf Energy, LLC submitted seven high bids totaling $5,533,710.

Walter Oil & Gas Corp. submitted two high bids totaling $5,397,050. Its highest bid, $5,205,000, was for Mississippi Canyon block 617.

Talos Energy Offshore LLC submitted 14 high bids totaling $5,272,978.

Houston Energy, L.P. submitted seven high bids totaling $1,418,920.

W&T Offshore, Inc. submitted six high bids totaling $825,750.

Ridgewood Energy Corp. submitted three high bids totaling $1,059,871.91.

LLOG Exploration Offshore, L.L.C. submitted two high bids totaling $912,888.50.

Murphy Exploration & Production Co. submitted one high bid totaling $359,685.20.

Red Willow Offshore, LLC submitted five high bids totaling $1,155,432.79.

Byron Energy Inc. submitted three high bids totaling $406,593.

Peregrine Oil & Gas II, LLC submitted two high bids totaling $254,900.

Castex Offshore, Inc. submitted three high bids totaling $224,485.71.

Ecopetrol America Inc. submitted four high bids totaling $3,908,000.

EnVen Energy Ventures. LLC submitted five high bids totaling $2,160,000.

Dorado Deep GP, LLC submitted three high bids totaling $18,065.80.

GOME 1271 LLC submitted three high bids totaling $313,959.48.

Fieldwood Energy LLC submitted three high bids totaling $1,584,362.50.

GulfSlope Energy, Inc. submitted two high bids totaling $322,022.

CL&F Offshore LLC submitted on high bid totaling $78,480.

SDB Offshore Energy, LLC submitted two high bids totaling $299,520.

Beacon Offshore Energy Exploration submitted two high bids totaling $739,537.

Lease Sale 251, livestreamed from New Orleans, was the third offshore sale held under the 2017-2022 Outer Continental Shelf Oil and Gas Leasing Program.

National Ocean Industries AssociationPresident Randall Luthi said the results reaffirm the state of the recovering industry.

“While not a barn burner, Lease Sale 251 tops theprevious Gulf sale in terms of increased participation, increased competition for offerings, and bid amounts,” he said. “In addition, bidding activity demonstrates both continued interest in deepwater tracts and renewed interest in shallow-water tracts.

Luthi added: “The operating environment in the US Gulf of Mexico shows tangible signs of improvement pointing to an industry that is poised to shift into high gear; oil prices are higher, revisions to overly burdensome regulations are in the works, rig rates and supply chain prices are more competitive, and companies have improved the efficiency of their operations. The results of today’s sale reaffirm the paradoxical state of an offshore energy industry in slow recovery mode; the future is bright but shifting out of reverse takes time.”

William Turner, senior research analyst at Wood Mackenzie, said: “With a decrease in acreage from March and the prospect of lower royalty payments for deepwater acreage off the table, expectations were muted going into this lease sale.

“However, with an increase in competitive bids and dollar amount from the last round, companies demonstrated their continued confidence in the region. Increased competition centering around more selective blocks close to infrastructure tells us that capital is returning to the Gulf of Mexico.”

He added: “Meanwhile, Equinor and Exxon, among others, demonstrated an increased appetite for risk with bids on remote blocks. This reflects the steady increase in oil price and competitive ROI now due to much more efficient practices in the Gulf of Mexico.”

08/15/2018

More in Regional Reports