Offshore Energy Industry Bets on Central Gulf Of Mexico ($949M)

The offshore energy industry continues to show interest in the Gulf of Mexico’s Outer Continental Shelf , with 67 companies submitting bids on 468 tracts offered offshore Louisiana, Mississippi, and Alabama in the Minerals Management Service Central Gulf Sale 213 that took place yesterday, March 17, 2010 at the Louisiana Superdome.

A total of 295 tracts in water depths greater than 1,300 feet received bids. The sealed bids will be opened and publicly read at tomorrow’s sale. The high bidder for each tract will have its bid analyzed for fair market value before the lease is awarded.

The sale, held by the U.S. Department of the Interior’s Minerals Management Service (MMS), encompasses 6,958 unleased blocks covering more than 36.9 million acres offshore Louisiana, Mississippi, and Alabama. Approximately 4.1 million unleased acres in the “181 South Area” are included in this sale, with Alabama, Mississippi, Louisiana, and Texas sharing in revenues from tracts leased in that area.

Blocks are located in Federal waters from three to more than 230 miles offshore, in water depths of about 10 feet (three meters) to more than 11,200 feet (3,400 meters). MMS estimates that this sale could result in production of approximately 0.8 to 1.3 billion barrels of oil and 3.3 to 5.4 trillion cubic feet of natural gas.

The sum of all bids received totaled $1,300,075,693.  The sale showed an increase of 5% from last year’s Central Gulf lease sale.  Each high bid on a tract will go through an evaluation process within MMS to ensure the public receives fair market value before a lease is awarded.