On Ultra-Deep Shelf Activities
HOUSTON, March 26 /PRNewswire-FirstCall/ -- Newfield Exploration Company (NYSE: NFX) today announced that it was the apparent high bidder on 51 of 62 bids in OCS Sale #185 in the Central Gulf of Mexico held last Wednesday by the Minerals Management Service (MMS). Newfield and partners exposed gross bids totaling $21.8 million. Net exposure to Newfield on the apparent high bids is $12.6 million. More than half of the apparent high bids were on "ultra-deep" shelf opportunities and were bid on under an exploration agreement with BHP Billiton. The leases bid on in Sale #185 are outside of the "Treasure Island" concept area.
Newfield remains one of the most active companies in the traditional shallow water plays of the Gulf of Mexico. The Company's drilling program in the traditional shelf is complemented by higher risk, higher potential plays in two areas -- the deep shelf and deepwater. Of the 51 blocks where Newfield was the apparent high bidder in OCS Sale #185, six were blocks associated with traditional shelf prospects, nine with deep shelf prospects, 33 with ultra- deep prospects and three with prospects in deepwater. Preliminary high bids were announced by the MMS. The MMS reserves the right to reject bids and will make a final award of tracts within 90 days.
Newfield also announced that its area of mutual interest agreement (AMI) with BP Exploration and Production Inc. in the Treasure Island concept area had been terminated. The termination of the AMI, which originally covered 112 blocks, does not effect the joint exploration agreement between Newfield and BP that currently covers 27 Treasure Island blocks. The termination also has no effect on the number of blocks subject to the Newfield-sponsored Treasure Island Royalty Trust. Newfield inherited these agreements with BP through its acquisition of EEX Corporation.
"We are excited about the Treasure Island concept and our continuing relationship with BP to explore this frontier play," said David A. Trice, Newfield President and CEO. "However, under the terms of the AMI, we would have been required to provide BP with the option to participate with a 75% interest in any future prospects developed on these blocks, regardless of drilling depth. We are one of the most active companies in the shallow waters of the Gulf and we weren't willing to limit any future activities on this large acreage base to just a 25% interest."
Newfield Exploration Company For information, contact: 363 N. Sam Houston Parkway East, Ste. 2020 Steve Campbell Houston, TX 77060 (281) 847-6081 www.newfld.com email@example.com
SOURCE Newfield Exploration Company