The Minerals Management Service (MMS) said Lease Sale 182 held on March 20 brought in $355.8 million from 489 high bids and a small amount of forfeited money. MMS Regional Director Chris Oynes said the majority of the bids were for tracts in shallow water rather than deepwater plays. However, deepwater tracts drew the highest single bids.

“We were pleased with the continued industry competition for Gulf of Mexico leases,” said Oynes. “Shallow-water bidding (water depths up to 655 feet) was significant for this sale, with shallow-water tracts receiving approximately 57% of the total accepted bids. This shallow-water activity can be attributed to relatively strong energy prices, and the MMS royalty relief provision for 20 Bcf of deep gas production (greater than 15,000 feet) in shallow shelf waters. Sixteen percent of the accepted bids were in deep-water ranging from 2,624 feet to 5,248 feet with a lease term of 10 years, and 15% of the accepted bids were in ultra deep water (5,249 feet or greater), also with a lease term of 10 years.”

The highest bid accepted on a tract was $17.5 million by Phillips Petroleum for Green Canyon Block 199. The second highest bid was for $14.9 million by Chevron U.S.A. Inc., Enterprise Oil Gulf of Mexico Inc., and PanCanadian Gulf of Mexico Inc., for Green Canyon Block 726. The third highest bid was submitted by BP Exploration and Production Inc., for $14.3 million for Mississippi Canyon Block 726. All top three bids were in water depths greater than 800 meters (2,624 feet).

However, the tract that received the most bids was in less than 200 feet of water. Eugene Island Block 159 received seven bids. This sale indicates the continued strong showing of both major and independent oil and gas companies participating in the Gulf.

The companies that rank in the top five for participating in the highest number of winning bids for Sale 182 are Spinnaker Exploration (42 tracts), Magnum Hunter Production (41), BP Exploration & Production (39), Dominion Exploration & Production (37) and Kerr McGee (36).

©Copyright 2002 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.