Completion of the sale is expected within the next few months, pending bid review and approval by the MMS. BHP Billiton's winning bids, both the net amount in partnership arrangements and as a 100 per cent interest-holder, are valued at approximately US$18.5 million, or nearly $ 527,000 per block, net to BHP Billiton.
The company submitted 11 bids on deepwater acreage, being the successful bidder on six blocks. These are primarily deep, subsalt prospects along the Atwater Foldbelt play fairway. BHP Billiton holds a 100 percent interest on four of these leases, while holding equity interests between 25 and 60 percent in the remaining two. All six deepwater blocks complement BHP Billiton's current leasehold positions in existing play fairways.
In addition to play fairways where the company has already built a strategic acreage position, BHP Billiton also pursued new opportunities for natural gas discoveries in the expanding deep shelf gas play. BHP Billiton bid on 33 blocks, submitting successful bids on 26 blocks in the West Cameron, East Cameron, South Marsh Island, Eugene Island, Ship Shoal and South Timbalier lease protraction areas. These are located in shallow waters and BHP Billiton is the designated operator with a 100 percent working interest in 20 blocks and a 55 percent working interest in the remaining six blocks.
Steve Bell, President Exploration and Business Development said today: "The confirmation of this award would increase our acreage holding in the Gulf of Mexico by 8% and is a logical extension to our current successful exploration activities. With our current appraisal programme across a number of discoveries, our two major development projects and a full exploration programme, the Gulf is emerging rapidly as a core business for BHP Billiton".
The company currently holds interests in more than 400 blocks, including more than 390 exploration leases, concentrated primarily on deep- and ultra-deepwater, and in the Central Gulf of Mexico region.
All of the blocks BHP Billiton successfully bid on in Lease Sale 190 are eligible for royalty relief on oil and natural gas production as outlined by the MMS.
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