Gulf of Mexico Lease Sale 254 Attracts $93MM in High Bids

Gulf of Mexico Lease Sale 254 Attracts $93MM in High Bids
Chevron, Shell Offshore and BP had the highest numbers in terms of total bids.

Bureau of Ocean Energy Management revealed that region-wide Gulf of Mexico Lease Sale 254 generated $93 million in high bids for 71 tracts covering 397,285 acres in Federal waters of the Gulf of Mexico. Twenty-two companies participated, submitting $109 million in total bids.

The lease sale included 14,594 unleased blocks from three to 231 miles offshore, in the Gulf’s Western, Central and Eastern Planning Areas in water depths ranging from nine to more than 11,115 feet. Of the participants, Chevron, Shell Offshore and BP were the companies that had the highest numbers in terms of total bids.

“The development of oil and gas assets in the Gulf of Mexico is a highlight of the Outer Continental Shelf,” said BOEM’s Gulf of Mexico Office Regional Director, Mike Celata. “The continued presence of large deposits of hydrocarbons in the region will draw the interest of industry for decades to come.”

The BOEM has included fiscal terms that consider market conditions. As such, in recognition of current hydrocarbon price conditions and the marginal nature of remaining Gulf of Mexico shallow water resources, these terms include a 12.5% royalty rate for leases in less than 200 meters of water, and a royalty rate of 18.75% for all other leases issued under the sale.

Lease Sale 254 was the sixth offshore sale held under the 2017-2022 National Outer Continental Shelf Oil and Gas Leasing Program. Under the program, 10 region-wide lease sales are scheduled for the Gulf. Two Gulf lease sales will be held each year and include all available blocks in the combined Western, Central and Eastern Gulf of Mexico planning areas, according to the BOEM.

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