High Prices Fuel Offshore Tracts Bidding

NEW ORLEANS – High oil and natural gas prices figured heavily Wednesday as petroleum exploration companies put up $588.3 million in winning bids for 405 offshore tracts off the coasts of Louisiana, Mississippi and Alabama.

The figure far exceeded last year’s auction by the U.S. Minerals Management Service when $342 million in winning bids were accepted for 403 tracts that exploration firms are betting on to produce in the central Gulf of Mexico.

MMS director Johnnie Burton indicated that she was not sure what to expect before the sale, considering the heavy damage left to production platforms and pipelines from hurricanes Katrina and Rita.

“I am very happily surprised,” Burton said. “Considering what this region has gone through, I would have not been surprised if they had shown a bit of timidity.”

AP