Government Maintains Plan To Sell New Offshore Gulf Oil Leases
The federal government continues in its plans to sell offshore oil leases in the Gulf of Mexico for the first time since the catastrophic destruction of the Deepwater Horizon drilling rig in April 2010. The sale, scheduled to take place in New Orleans on December 14, 2011, is anticipated even as federal officials continue to mull proposed changes to safety regulations governing the oil industry.
The newly-announced lease offering makes available swaths of western Gulf parcels off the coast of Texas. According to media reports, Interior Secretary Ken Salazar described the federal agency as comfortable with resumption of Gulf deepwater drilling in light of new and rigorous standards in place. Still, the announcement has been met with skepticism in some quarters, as environmental advocates question whether safe drilling practices will prevail. For its part, the American Petroleum Institute expressed cautious optimism but was less than enthusiastic about the announcement that minimum bids for deepwater leases would be significantly increased.
The bid package indicates that minimum bonus bids must be at least $25 per acre for blocks in water depths of less than 400 meters, or $100 or more for blocks in deeper waters. According to the government, the previous minimum bid level of $37.50 per acre for deepwater blocks had been in place since 1999, when oil prices were near $20 per barrel.
Details of the Proposed Notice of Sale are available at the website of the Bureau of Ocean Energy Management, Regulation and Enforcement.
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