W&T Offshore bags two shallow-water blocks in Gulf of Mexico round

U.S. oil and gas company W&T Offshore was the apparent high bidder on two blocks in the Gulf of Mexico Lease Sale 256 held by the Bureau of Ocean Energy Management (BOEM) on 18 November 2020.

W&T said on Tuesday that it was the apparent high bidder in the most recent Gulf of Mexico lease sale on two shallow-water blocks, Eugene Island South Addition block 389 and Ewing Banks block 979.

These two blocks cover a total of approximately 8,800 acres. If awarded, the company will pay approximately $518,000 for the awarded leases combined, which reflects a 100 per cent working interest in the acreage.

The two shallow-water blocks have a five-year lease term and 12.5 per cent royalty.

Despite submitting the apparent high bid on these leases, the BOEM reserves the right not to award the blocks based on their minimum bidding criteria. W&T expects to receive the final award results over the next 90 days.

The latest Gulf of Mexico lease sale generated more than $120 million in high bids for 93 tracts covering approximately 79 million acres in federal waters of the Gulf of Mexico.

A total of 23 companies participated in the lease sale, submitting $135,558,336 in total bids, according to BOEM.

Talos Energy was also one of the companies to win new acreage as part of the lease sale. Talos placed a sole bid on the Viosca Knoll 1000 as well as a joint bid with an affiliate of BP on Green Canyon 866 blocks.

When approved, the blocks will provide an additional 11,520 gross acres for future exploration acquired at an average cost of less than $300 per gross acre.