The Houston-based global exploration and production company ConocoPhillips (COP - Free Report) emerged as the highest bidder in the latest Gulf of Mexico (GoM) lease sale, which drew the second-lowest amount in bids in last three decades.
ConocoPhillips, the operator of a single oil and gas platform in the GoM shelled out $30.58 million for the rights to explore and drill in a tract around 200 miles south of Galveston, Texas.
Per the U.S. Bureau of Ocean Energy Management, on the whole, 61 bids were submitted by 12 companies for 53 tracts amounting to $144.7 million. The Bureau sanctions leases for oil and gas producers to operate in the GoM. Of the total bids, high bids amounted to $102.35 million, while the remaining were unsuccessful.
Located about 60 miles northeast of Royal Dutch Shell plc’s Perdido platform, the tract over which ConocoPhillips has gained access by submitting the highest bid, is the newest in the region. The tract was brought online around three weeks before BP plc’s (BP - Free Report) Macondo oil spill in 2010.
Consequent to the oil spill, BP was boycotted from acquiring federal contracts, including new leases in the GoM, under a U.S. Environmental Protection Agency ban announced in Nov 2011. Therefore, BP did not submit a bid for the latest sale.
The latest sale had ConocoPhillips submitting the top sum of high bids at $50.3 million, after Chevron Corp (CVX - Free Report) bidding $32.8 million, Maersk bidding $6.8 million and Royal Dutch Shell with a $4.2 million bid. The most unsuccessful bid at $18.1 million was presented by Anadarko Petroleum Corp. (APC - Free Report) .
All unleased and non-protected areas in the Western Gulf of Mexico planning area were offered in the Western Gulf of Mexico Lease Sale. The sale comprised 3,864 tracts from nine miles to over 250 miles off the coast, in depths ranging from 16 feet to over 10,975 feet.
ConocoPhillips carries a Zacks Rank #3 (Hold).