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January 27, 2012
GoM: Obama administration announces proposed Central Gulf
of Mexico Oil and Gas Lease Sale
The Obama administration today announced that the Department
of the Interior’s Bureau of Ocean Energy Management
(BOEM) will hold the consolidated Central Gulf of Mexico Lease
Sale 216/222 in New Orleans on June 20, 2012. The sale will
make nearly 38 million acres available as part of the President’s
Blueprint for a Secure Energy Future. The sale will include
all available unleased areas in the Central Planning Area
offshore Louisiana, Mississippi and Alabama.
President Obama will discuss today’s announcement during
remarks in Nevada later today, in which he will highlight
his administration’s commitment to promoting safe and
responsible domestic oil and gas production as part of a comprehensive
energy strategy. This is one of many steps that the Administration
is taking, at the President’s direction, to increase
responsible domestic production and reduce dependence on foreign
oil.
'Expanding offshore oil and gas production is a key component
of our comprehensive energy strategy to grow America’s
energy economy, and will help us continue to reduce our dependence
on foreign oil and create jobs here at home,' said Secretary
of the Interior Ken Salazar. 'The President has made it clear
that developing our domestic oil and gas resources is a significant
part of this administration’s efforts to grow our economy
and create jobs. This lease sale is part of our commitment
to safe and responsible development of the Outer Continental
Shelf.'
Lease Sale 216/222 is the last remaining sale scheduled in
the 2007 – 2012 Outer Continental Shelf Oil and Natural
Gas Leasing Program. As the President discussed in his State
of the Union address on Tuesday, DOI is finalizing the next
Five-Year Program for 2012-2017, which will make more than
75 percent of undiscovered technically recoverable oil and
gas estimated on the OCS available for development. The Proposed
2012-2017 Outer Continental Shelf (OCS) Oil and Gas Leasing
Program schedules 12 lease sales in the Gulf of Mexico.
'The Central Gulf of Mexico remains the area with the greatest
offshore oil and gas potential in the entire United States
outer continental shelf, and this proposed sale is another
important step in making this area available for safe and
environmentally responsible exploration and development,'
said Director Tommy P. Beaudreau. 'We are moving forward with
this sale based on careful analysis of the best scientific
information available and consideration of all of the public
comments we have received.'
The proposed lease sale includes approx. 7,250 unleased blocks
covering nearly 38 million acres. The blocks are located from
three to about 230 miles offshore, in water depths ranging
from nine to more than 11,115 feet (three to 3,400 meters)
in the Central Gulf of Mexico, a region that BOEM estimates
contains close to 31 billion barrels of oil and 134 trillion
cubic feet of natural gas that are currently undiscovered
and technically recoverable. BOEM estimates that the Central
Gulf sale could result in the production of 1 billion barrels
of oil and 4 trillion cubic feet of natural gas.
The terms of sale will reflect recent administrative reforms
to ensure fair return to taxpayers and encourage diligent
development, consistent with policies articulated in the Obama
administration’s Blueprint for a Secure Energy Future.
These include escalating rental rates to encourage prompt
exploration and development of leases, as well as time under
the lease if the operator demonstrates a commitment to exploration
by drilling a well during the base period. The durational
terms of leases are graduated by water depth to account for
differences in operating at various water depths.
In addition, BOEM recently increased the minimum bid for
deepwater to $100 per acre, up from only $37.50, to ensure
that taxpayers receive fair market value for offshore resources
and to provide leaseholders with additional impetus to invest
in leases that they are more likely to develop. Rigorous analysis
of the last 15 years of lease sales in the Gulf of Mexico
showed that deepwater leases that received high bids of less
than $100 per acre, adjusted for energy prices at time of
each sale, experienced virtually no exploration and development
drilling.
The terms of sale also reflect a series of conditions to
protect the environment. These include stipulations to protect
biologically sensitive resources, mitigate potential adverse
effects on protected species, and avoid potential conflicts
associated with oil and gas development in the region. BOEM
completed a supplemental environmental impact statement relating
to this sale, which considers the latest available information
for the Central Gulf of Mexico Planning Area following the
Deepwater Horizon oil spill.
Proposed terms and conditions for the sale, which will be
finalized in a Final Notice of Sale published at least 30
days prior to the Sale, are detailed in the Proposed Notice
of Sale information package, which will be available at: http://www.boem.gov/Oil-and-Gas-Energy-Program/Leasing/Regional-Leasing/Gulf-of-Mexico-Region/Lease-Sales/216-222/Central-Planning-Area-Lease-Sale-216-222-Information.aspx.
Copies can also be requested from the Gulf of Mexico Region’s
Public Information Office at 1201 Elmwood Park Boulevard,
New Orleans, LA 70123, or at 800-200-GULF (4853).
The Notice of Availability of the Proposed Notice of Sale
will be available for inspection today in the Federal Register
at: http://www.archives.gov/federal-register/public-inspection/index.html.
Source: BOEM
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