Oil and gas leases in Gulf of Mexico bring in relatively tepid bids

03/21/2018 The Washington Post

Energy companies paid $124.8 million on Wednesday for oil and gas prospects in the largest Gulf of Mexico lease sale ever, but the winning bids fell well short of past sales.

The totals also appeared modest compared with the expectations raised by President Trump in his “America-First Offshore Energy Strategy” that was aimed at substantially enhancing the nation’s “energy dominance.”

Oil companies bid on 148 blocks, just 1 percent of the blocks put up for sale despite royalty breaks the administration provided for some of the shallower areas. The Interior Department’s Bureau of Ocean Energy Management had put 77.3 million acres up for auction.

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Mexico to Auction 15 Shallow Exploration Blocks in Gulf

07/19/16 ABC News 

The Mexican government announced plans Tuesday for an auction of exploration and shared-production rights on 15 blocks of potential oil fields in the shallow waters of the Gulf of Mexico.

The blocks cover 3,440 square miles (8,908 square kilometers) and contain potential reserves of up to 1.58 billion barrels of crude equivalent.

Energy Secretary Pedro Joaquin Coldwell said that the blocks are expected to start producing oil by 2020 and that investment in the projects could reach $11.25 billion over the life of the contracts.

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Mexico, Cuba, U.S. discuss ‘Doughnut Hole’ in Gulf waters

Reuters 07/06/16 

Delegates of Mexico, the United States and Cuba met on Wednesday to discuss the limits of the Western Polygon, an area in the waters of the Gulf of Mexico that has oil and gas deposits but no clear boundaries, two sources close to the discussion said.

Talks about who owns what in the “Doughnut Hole” were spurred after Cuba and the United States announced they would restore diplomatic ties in late 2014.

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Mexico ruling party routed in regional vote on graft, gang violence

6/6/16 Reuters

Mexico’s ruling party lost several bastions in Sunday’s regional elections to the center-right opposition, dealing a heavy blow to President Enrique Pena Nieto for failing to crack down on corruption and gang violence.

The rout will help set the tone for the next presidential election in 2018, underscoring deep discontent over graft scandals and a sluggish economy, and throwing the contest open to contenders from both the left and right.

Early results from gubernatorial races in 12 of Mexico’s 31 states on Monday showed Pena Nieto’s ruling Institutional Revolutionary Party, or PRI, heading for defeat in seven of them, a result far worse than most polls had forecast.

Projected losses included two oil-rich strongholds in the Gulf of Mexico, Veracruz and neighboring Tamaulipas, both of which have been plagued by gang violence for years, as well as Quintana Roo, home to Mexico’s top tourist destination Cancun. All three have been run by the PRI for over eight decades.

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BP Results Still Hurt by Gulf of Mexico Spill

4/26/16 Wall Street Journal

LONDON— BP PLC’s fatal blowout in the Gulf of Mexico in 2010 continues to haunt the company, helping to drag its quarterly earnings into a second consecutive loss and overshadowing the British oil giant’s progress on cost cuts.

BP on Tuesday said its earnings took a $917 million hit in the first quarter related to the Deepwater Horizon explosion that killed 11 workers and caused a massive spill in the Gulf of Mexico, a disaster that changed the course of the British oil giant and cost the company $56.4 billion to date.

The additional spill costs and the weakest oil prices in over a decade cast a cloud over BP’s financial performance, despite signs that heartened investors and caused the firm’s shares to jump over 4%.

Counting the Deepwater Horizon costs, BP said its equivalent of net earnings was a $485 million quarterly loss. Stripping out those and other one-time charges, BP had a profit of $532 million in the first quarter, significantly beating analysts’ consensus forecast for a loss of $140 million.

The spill forced the company to sell more than $40 billion in assets, pull back its ambitions and craft the business around a smaller set of high-value oil and gas fields.

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U.S. Judge Approves BP Settlement for 2010 Gulf of Mexico Oil Spill

4/5/16 Fortune 

U.S. Judge Carl Barbier granted final approval on Monday to BP’s civil settlement over its 2010 Gulf of Mexico oil spill after it reached a deal in July 2015 to pay up to $18.7 billion in penalties to the U.S. government and five states.

“Today’s action holds BP accountable with the largest environmental penalty of all time while launching one of the most extensive environmental restoration efforts ever undertaken,” U.S. Attorney General Loretta Lynch said in a statement.

The company at the time said its total pre-tax charges from the spill set aside for criminal and civil penalties and cleanup costs were around $53.8 billion.\

Under the terms of the original agreement with the U.S. Department of Justice and the Gulf Coast states, BP BP -1.83% will pay at least $12.8 billion for Clean Water Act fines and natural resource damages, plus $4.9 billion to states. The payouts will be staggered over as many as 18 years.

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Gulf Oil, Gas Leases Up for Sale; Environmentalists Protest

3/23/16 New York Times

NEW ORLEANS — The federal government is selling off oil and gas leases in the Gulf of Mexico during a sale Wednesday, but environmentalists opposed to fossil fuels development on public lands plan to protest.

The Bureau of Ocean Energy Management is offering about 45 million acres for exploration and development. Companies submit bids in advance to the agency, which announces the results at the sale. It’s held at the Superdome.

Wednesday’s auction will be for lots in the central and eastern sections of the Gulf. The central region is generally the most active part of the Gulf. The Bureau of Ocean Energy Management said Tuesday that it had received 148 bids on 128 blocks in the central section but had received no bids for the eastern region.

Interest has been limited in recent sales as the industry struggles with low energy prices.

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