Offshore leases in the Gulf of Mexico for which oil companies once bid millions of dollars at federal auctions are being returned to the federal government this year in record numbers, a consultant said Saturday.
The trend began after the 1986 crash in oil prices and accelerated when natural gas prices also dropped sharply, according to consultant James Dodson of Grapevine, Texas.During the first five months of 1992, a total of 156 leases had been returned at a pace that may lead to a record 374 leases being given up, Dodson said.
Offshore operators surrendered 50 wells in one recent week alone, including 37 by Exxon and Shell, although Shell Offshore retains some 900 Gulf of Mexico leases, he said.
The decline in interest in Gulf of Mexico leases, some of them extending to the year 2000, was partly due to decisions by major companies to search overseas at less cost for more lucrative fields.
Normally, smaller, independent operators would step in to drill on leases abandoned by the majors, but this has not occurred to a great degree because the independents have less money on hand due to record-low natural gas prices.