MMS' Western Gulf Lease Sale 192 Nets $170 Million
The Minerals Management Service (MMS) said last week that it has accepted high bids totaling $170 million on 346 of the 351 tracts offered during offshore Oil and Gas Lease Sale 192, which was held on Aug. 18.
The government agency noted that of the 351 tracts receiving bids during the sale, MMS rejected four high bids totaling $1.3 million as insufficient for fair market value. In addition, one high bid at $201,201 was deemed unacceptable by MMS because it was below the required minimum bid amount stated in the Final Notice of Sale. MMS accepted the high bids on 346 tracts for a net amount of $170 million.
"This sale indicates the continued strong interest of major and independent oil and gas companies in the Gulf," the MMS said. "The results of the sale also indicate a continuing interest in shallow-water areas."
The highest bid accepted on a tract was $68 million by Houston Exploration Co. for High Island, East Addition, South Extension A-270. The tract is located in water depths less than 200 meters and received four bids. The MMS reported that the second and third highest bids accepted were $4.9 million by Remington Oil and Gas Corp. on Garden Banks 506 and $4.2 million by Kerr-McGee Oil & Gas Corp. on East Breaks 424, both of which were in the 800- to 1,599-meter water depth range.
Amerada Hess Corp. had the most accepted high bids at 56 for a total of $12.9 million, while BP Exploration & Production's 47 accepted bids amounted to $27.8 million, the highest total for a company among bidders.
Petrobras America Inc. had 36 accepted bids for $10.5 million, while Devon Energy Production Co. LP had 26 bids for $11.5 million and Kerr-McGee Oil & Gas Corp. had 24 bids for $14.1 million.
Prior to accepting the high bids, MMS said it completed an extensive two-phase bid evaluation process to ensure that the government receives a fair monetary return for the public mineral resources it makes available. The funds collected are distributed to the general fund of the U.S. Treasury, shared with the affected states, and set aside for special uses that benefit all 50 states.
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