Gulf of Mexico lease sale set for June

May 18, 2012 at 8:46 AM
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WASHINGTON, May 18 (UPI) -- The U.S. government said it will put more than 7,000 oil and natural gas blocks up for auction in a June 20 lease sale for the Gulf of Mexico.

The U.S. Interior Department and Bureau of Ocean Energy Management said more than 38 million acres is up for sale in the June 20 sale planned in New Orleans. The government estimates the sale could result in the production of more than 1 billion barrels of oil and 4 trillion cubic feet of natural gas.

"The Gulf of Mexico is the crown jewel of the U.S. Outer Continental Shelf, and home to a number of world-class producing basins, including many in deep-water areas that are becoming increasingly accessible with new technology," BOEM Director Tommy Beaudreau said in a statement.

The blocks are 3-230 miles offshore and include shallow- and deep-water acreage. The minimum bid for deep-water sites is $100 per acre. The Interior Department didn't indicate a minimum for shallow-water blocks.

The BOEM said the terms of the lease sale include stipulations on environmental and ecosystem protection. The department said its decision was based on lessons learned from the Deepwater Horizon tragedy in the Gulf of Mexico in 2010.

The government this week said as much as 60 percent of the land leased by oil and natural gas companies aren't under development. Critics of U.S. President Barack Obama's energy policy say the White House is blocking domestic oil and natural gas production.

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