Feds to offer nearly 44 million acres in Gulf of Mexico for oil, gas drilling

10 17, 2014 by The Times-Picayune

The federal government will offer nearly 44 million acres off the coasts of Louisiana, Mississippi and Alabama for oil and gas exploration, the seventh sale in the Gulf of Mexico under its five-year leasing program.

The lease sale, which will be held in March 2015 in the Mercedes-Benz Superdome, will include more than 7,000 lease blocks covering 43.5 million acres in the central Gulf of Mexico.

The locations of the proposed lease areas range from three to 230 nautical miles offshore. Leases will extend to federal waters more than 11,000 feet deep.

The sale will also include leases located along the U.S.-Mexico nautical border, an area newly opened to oil and gas activity as a result of new trade agreement reached between the two countries.

The Bureau of Ocean Energy Management, which oversees oil and gas leasing in federal waters, estimates the proposed lease areas could hold up to 894 million barrels of oil and up to 3.9 trillion cubic feet of natural gas.

The Obama administration has offered more than 60 million offshore acres and netted $2.4 billion during the six previous lease sales under its 2012-2017 lease program.

The last lease sale in the western Gulf of Mexico in August drew $110 million in high bids for 81 tracts off the Texas coast.

A quarter of bids during that sale targeted lease blocks in waters within three miles of the U.S.-Mexico maritime boundary

That area has long been off limits to oil and gas companies in both countries.

A new agreement reached last year will allow American companies to partner with the state-owned Petroleos Mexicanos, or Pemex, to explore and produce oil and gas in the region.

Increased oil and gas activity in Mexico is expected to drive growth for an array of Louisiana companies over the next decade.