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November Gulf oil lease sale changing length at some depths

Last Updated Oct 18, 2020 at 10:14 am MDT

NEW ORLEANS — A federal oil lease sale in November will be the first in a decade to offer 10-year leases at some depths.

Since 2010, leases in depths of 800 to 1600 metres (about a half-mile to nearly a mile) have run for seven years, with a three-year extension available for companies that have started a well on their lease.

“After a careful analysis of the past 10 years’ data, … BOEM is reverting to offering the 10-year primary term in these specific water depths,” the Bureau of Offshore Energy Management said in a news release Thursday. Leases in deeper waters remain at 10 years. In shallower waters, the leases are for five years, with a three-year extension for companies that start a well within those first five years.

The agency is offering about 78 million acres (31.6 million hectares) in water from nine feet to more than 11,115 feet (three meters to 3,400 metres).

Like all sales since August 2016, the sale on Nov. 18 will be livestreamed, Bids will be read publicly.

The last lease sale, in March, offered about the same acreage and got bids on about 0.5% of the total.

The Associated Press