Operator interest was subdued in the Minerals Management Service's Sale 189 in the eastern Gulf of Mexico in December in New Orleans. However, the deepwater sale covered the same 256-block area in which Sale 181 was held in 2001 and in which Sale 197 will be held in 2005. The original Eastern Planning Area of 1,033 blocks (5.9 million acres) was adjusted drastically downward by the federal government in July 2001. In its latest sale, the MMS received $8.3 million in high bids on 14 tracts, out of a total of 138 unleased blocks covering 794,880 acres. Six companies participated: Shell Offshore, Nexen Petroleum, Murphy E&P, Dominion E&P, Newfield Exploration and Spinnaker Exploration. Shell and Nexen made the highest bid in the sale, offering $2.2 million for DeSoto Canyon 398. The only block that lured more than one bid was DeSoto 353, which is adjacent to a Marathon Oil Corp. prospect in DeSoto 354. Shell and Nexen Petroleum took the contested block with a high bid of $793,521, besting an offer from Dominion and Spinnaker and a bid by Murphy and Newfield. In contrast, the sale in December 2001 was a resounding success for the MMS, garnering $340.5 million in high bids by 17 companies on 95 tracts. Interest was extremely high because Sale 181 was the first in the eastern Gulf since 1988. Anadarko Petroleum and Shell were the dominant players, placing $245 million in high bids between them. Last year saw the first new drilling in the Sale 181 area. Partners Marathon and Kerr-McGee plugged and abandoned their Barracuda test on DeSoto 927, sited in 8,500 feet of water. Anadarko also abandoned its Hawkeye test on Lloyd Ridge 360, in 9,086 feet of water. Two tests remain tight holes: Devon Energy and EOG Resources drilled their Tuscany prospect on DeSoto 180 in 6,953 feet of water, and Shell drilled its Shiloh test on DeSoto 269 in 7,516 feet of water. Anadarko has enjoyed success, however. It started its eastern Gulf campaign with its Jubilee prospect, in Atwater Valley 349, just outside the western boundary of the Sale 181 area. That well encountered Miocene sands that contained recoverable gas reserves in the range of 40- to 50 million barrels of oil equivalent. Anadarko followed Jubilee with its Atlas test, drilled to 19,800 feet total depth in Lloyd Ridge 50 in 8,950 feet of water. The Atlas well encountered 180 feet of gross pay, but portions of the reservoirs were thinly bedded. Both finds are small as deepwater prospects go, and to be commercially viable will have to be developed as part of a larger project. Now, the company reports a bigger find. The Spiderman prospect was drilled on DeSoto 621 in 8,098 feet of water to a total depth of 18,065 feet. It encountered 140 feet of net pay in Middle Miocene reservoirs. The well was subsequently sidetracked to a structurally high position in both of the main objectives, reports partner Spinnaker. Anadarko operates and has a 45% interest in Spiderman, which extends beneath adjoining Block 620. Dominion holds 36.67%; Spinnaker, 18.33%. To date, the finds in the eastern Gulf have been gas-bearing Miocene reservoirs draped over structures. The next few years will see more high-profile tests, as operators seek to determine the true prospectivity of this frontier area. Anadarko recently spudded a well on its Northwest Atlas prospect in Lloyd Ridge 5, and upcoming plans in the first half of the year include a Dominion/Spinnaker test on its San Jacinto prospect on DeSoto 618 and a Murphy/Newfield probe of their Dalmation prospect, in DeSoto blocks 47 and 48. Shell has additional prospects in the area: Red Dawg in DeSoto blocks 622 and 666, and Cheyenne in Lloyd Ridge 299. Marathon and Kerr-McGee are partnering on a number of prospects, including Raptor and West Raptor in DeSoto blocks 445, 489-91, and 535, and Kish, in DeSoto blocks 226 and 270. Anadarko also has plans for a delineation well at Jubilee and an exploration well on its Mondo prospect in Lloyd Ridge blocks 47, 91 and 135. Additionally, Petrobras recently filed an exploration plan with the MMS for DeSoto 530.