New Acreage Along the Central Gulf Opened for Drilling

by | Wednesday, August 20, 2014 |

On Tuesday, August 19th, the Federal Government opened 21 million acres off the Texas coast for oil and gas drilling. The area includes sections along the United States and Mexico nautical boarder, all of which were previously off-limits to drilling companies.

The sale was held at the Superdome in New Orleans, and was the sixth such sale under President Obama’s current leasing plan. The plan extends through 2017.

Under the plan, the federal government offered over 60 million acres for development, and has already generated over $2 billion in bid revenues through sales thus far. During the most recent sale in March, in fact, oil and gas companies bid over $872 million for areas that span nearly two million acres in the central Gulf of Mexico.

Generally, sales in the Western Gulf of Mexico cover a significantly smaller area, and tend to generate less revenue.

On Tuesday, the Bureau of Ocean Energy Management accepted closed bids, and stated that fourteen companies had submitted 93 bids on 81 gas and oil tracts.

This sale offers 4,026 total tracts, and is the first to offer acreage in this particular area. The agreement reached in 2013 set up a framework for companies to collaborate with Pemex, Mexico’s state-owned gas and oil company, to develop the area.

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