A federal oil lease sale in November will be the first in a decade to offer 10-year leases at some depths in the Gulf of Mexico.
The Bureau of Ocean Energy Management announced last week that it was reverting to terms in place for water depths of 800 to 1,600 meters prior to 2010, when those leases were offered with a seven-year primary term that could be extended for an additional three years if the lessee spudded a well.
Leases in 1,600 meters of water or deeper will continue to have the full 10-year term as in prior sales. In shallower waters, the leases are for five years, with a three-year extension for companies that start a well within those first five years.
The regionwide sale scheduled for Nov. 18 will offer roughly 78 million acres, including all available unleased areas in federal Gulf waters.
Lease Sale 256, scheduled to be livestreamed from New Orleans, will be the seventh offshore sale under the 2017-2022 Outer Continental Shelf Oil and Gas Leasing Program. Under this program, ten regionwide lease sales are scheduled for the Gulf, where there is substantial resource potential, and oil and gas infrastructure is well established.
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.
Lease Sale 256 will include approximately 14,755, unleased blocks, located 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 (three to 3,400 meters).
Excluded from the lease sale are: blocks subject to the congressional moratorium established by the Gulf of Mexico Energy Security Act of 2006, blocks adjacent to or beyond the U.S. Exclusive Economic Zone in the area known as the northern portion of the Eastern Gap and whole blocks and partial blocks within the current boundaries of the Flower Garden Banks National Marine Sanctuary.
All terms and conditions are detailed in the Final Notice of Sale information package. Of note, BOEM will be accepting bids by mail only for this sale. Walk-in bidding will not be permitted. Get the Notice of Availability of the FNOS.
