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Central Gulf Lease Sale Attracts High Bids of $949M

Anadarko Exploration & Production Co. LP and Mariner Energy Inc. last Wednesday were the highest bidders during the Central Gulf of Mexico Lease Sale 213. The two producers jointly bid $52.56 million for Walker Ridge Block 793.

The sale, which was conducted by Interior Department's Minerals Management Service (MMS), attracted a total of $949.3 million in high bids. The sum of all bids received was $1.3 billion. Seventy-seven companies submitted 642 bids on 468 tracts comprising more than 2.4 million acres offshore Louisiana, Mississippi and Alabama, MMS reported.

"The bidding activity at [the] sale speaks to the future of [the] deepwater Gulf in providing vital energy production for the nation," said Lars Herbst, regional director of MMS Gulf of Mexico. "There was also an increase in interest in shallower waters that offers deep gas potential, which is encouraging."

MMS estimated that 151 tracts in water depths of less than 656 feet received bids. This represented 32% of all the tracts receiving bids, which was an increase of 5% from last year's Central Gulf lease sale, the agency said.

Jack Gerard, president of the American Petroleum Institute, called the lease sale robust. "The oil and natural gas industry stands ready to invest in America and create additional new jobs, as evidenced by its strong bidding during the Central Gulf 213 lease sale, in which the industry was able to bid on parcels in several new areas.

"The U.S. government could replicate this success by providing leasing opportunities in unexplored areas of the Outer Continental Shelf -- like offshore Virginia, the eastern Gulf of Mexico and the Chukchi and Beaufort seas off Alaska."

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