Long dwarfed by the shadow of the Central Gulf of Mexico, the Western Gulf planning area has seen less leasing, less drilling and, perhaps not surprisingly, fewer discoveries.

This could be about to change. After the Aug. 20 Western of Mexico lease sale netted US $487 million in high bids -- $207 million more than last year’s sale – enthusiasm was high that the tide could be turning for this area.

Dirk Kempthorne, secretary of the US Department of the Interior (DOI), held a press conference from New Orleans to announce the results of the sale. “[The money bid] from the 423 bids submitted today is proof that the oil and gas industry is committed to being part of the answer to the energy security needs of the United States of America,” Kempthorne said. “Industry is willing to invest with the full realization that they’ve been given a responsibility to diligently explore, develop, and produce our country’s energy resources in a safe and an environmentally sound manner.”

A total of $607 million was bid by 47 companies on 319 tracts offered offshore Texas comprising more than 1.8 million acres.

Representatives from the DOI and the US Minerals Management Service (MMS) seemed unconcerned that only 10% of the available tracts were bid on. C. Stephen Allred, assistant secretary, land and minerals management, said this was in no way a disappointment.

“It doesn’t surprise us because in our analysis the leases that sold were generally the leases where we thought there might be oil,” he said. “That doesn’t mean there’s not oil or gas under the 90% that were not bid. It’s just that our data, and I assume the data of the oil companies, doesn’t indicate that there’s a high probability.”

Ironically, many of the blocks that were bid have been available in past leases but have not generated much interest. Lars Herbst, regional director for the Gulf of Mexico Region of MMS, said this could be the result of new technology.

“We saw interest [in newly available tracts] decline,” he said. “But we also interest in acreage that’s been available for some time, especially in the Alaminos Canyon and East Breaks area. I think that goes back to technology developments such as seismic and interpretation, and there’s now an interest in those blocks that wasn’t there in the past two or three sales.”

Department spokesmen seem confident that results of today’s sale will spur more development in the area as more wells are drilled and more infrastructure is put into place.

Top five bids went to StatoilHyrdo, Alaminos Canyon block 380, $61 million; Chevron, Garden Banks block 973, $52 million; Chevron, Garden Banks block 972, $34 million; StatoilHydro, Alaminos Canyon block 424, $22 million; and Chevron, Alaminos Canyon block 775, $20 million.

More information can be found at www.mms.gov.