BP and Chevron top the list of bidders in Trump's first Gulf of Mexico Oil and Gas auction
BP, Chevron, and Shell were the top bidders at the first U.S. Government sale of oil and natural gas drilling rights for the Gulf of Mexico since 2023.
The auction ended with a total of $279.4 millions in "high" bids. It was the first out of 30 required by President Donald Trump's tax cuts and spending bill that he signed in July.
His administration's plans on offshore leasing represent a major departure from those of his predecessor President Joe Biden. Biden had planned a historically low number of oil and?gas?auctions in an effort to shift away from fossil fuels while addressing climate change.
Matt Giacona said, "We are entering a?new era of American energy dominance" at the beginning of the auction. The auction was broadcast on the internet.
BOEM reported that 30 companies had submitted 219 bids for?1.02million acres, or about 1.3% of all the land offered.
According to the sale documents, BP was followed by Shell and Chevron. Anadarko was also a top bidder, as were LLOG Exploration Offshore and Talos Energy, Murphy Exploration & Production, Talos Energy, and LLOG Exploration Offshore.
Chevron's bid of nearly $18,6 million for a deepwater block in Keithley Canyon was the highest. Woodside Energy Deepwater, Repsol and Woodside Energy Deepwater jointly bid $15.2 million for a Walker Ridge block.
BOEM, a division of the Interior Department, has offered to lease 81.2 million acres on the Gulf for a 12.5% royalty rate, the lowest allowed by Trump's tax law. Biden's Inflation Reduction 2022 Act mandated that oil companies pay 16.66% in royalties to U.S. Treasury and states.
Trump's Law lowered the lease rate to encourage participation by industry in leasing sales. ?U.S. The price of crude oil has fallen by about 20% in the past year. This can limit investment for drillers. However, technological advances in deep-sea exploration are expected to boost Gulf production.
The offshore production of the United States is about 15%, but it has been lagging behind onshore shale in recent years due to longer timelines and greater upfront costs.
In 2023, the last Gulf sale attracted 352 offers from 26 companies for 1.73 million acres. The sale raised $382m, the most of any federal lease sale offshore since 2015. Bill Berkrot edited the report by Nichola Groom.
(source: Reuters)
