The super majors dominated the Western Gulf of Mexico Lease Sale 207, accounting for more than half of all high bids, but the lower-tiered companies were focused and largely successful with their targeted prizes. "Interest in deepwater exploration continues to be robust," says Calyon Securities (USA) Inc.'s Jeb Armstrong, "especially for the super majors, which accounted for half of all bidding."
ExxonMobil took home the Gulf gold by a fraction with $127 million in total winning bids for 130 blocks, a third of the total, and Chevron took silver just a few hundred dollars behind for a selected 20 blocks. Per the analysts at Tudor, Pickering, Holt & Co. Securities Inc., Chevron brought its "flash money" as three bids alone totaled $105 million for three deepwater blocks.
Norway's StatoilHydro took the bronze with a total of $87 million in high bids---and the gold for single individual bid at $61 million for a 100% working interest in deepwater block Alaminos Canyon 380. If StatoilHydro's modus operandi holds, expect a nice farm-down forthcoming.
Privately held LLog Exploration steppped up with 11 out of 11 successful bids totaling $23 million, ranking fourth in total bids. Its bid of $8 million for High Island 169 was the eighth highest bid in the sale. All of LLog's bids were on the shelf in the High Island area and one in West Cameron.
Anadarko Petroleum was one of the most active bidders, securing $20 million in wins mostly centered around NW Nansen with some in the southwestern corner of the Gulf, "which is likely to be prospective for the lower tertiary trend," says Armstrong.
In their respective weight classes, domestic companies took home medals with Hess securing 22 out of 27 tries for $14 million; Devon bagging 20 of 26 for $6 million; Focus getting 14 of 18 for $4 million; Century going one for one at $3 million;El Paso going four for four with $1 million; Cobalt landing two out of two for $1 million; and Galvez Energy sweeping five for five for $1 million.
Overall, the sale netted $487 million in high bids, an average of $267 per acre, compared with $183 per acre a year ago per TPH, and well below the "eye-popping" $1,107 an acre from the most recent Central GOM lease sale in March. European firms were active, says Calyon, but bidding by Asian firms was limited.
Top 10 GOM Lease Sale 207 Winning Bidders
Company Total high bids Sum of high bids ($MM)
Exxon Mobil 130 $127.33
Chevron 20 $127.28
Statoil 5 $87.35
LLOG Exploration 11 $23.17
Shell GOM Inc 15 $20.20
Anadarko Petroleum 19 $14.81
Hess Corp 22 $14.16
Eni 5 $11.13
ConocoPhillips 2 $10.50
Devon Energy 20 $6.67
Steve Toon, Editor, A&D Watch
; Contributing Editor, Oil and Gas Investor; www.OilandGasInvestor.com; firstname.lastname@example.org