Last week the U.S. Environmental Protection Agency (EPA) removed its restrictions on BP PLC (NYSE: BP), allowing the company once again to conduct business with the federal government and giving the company the right once more to bid on leases in the Gulf of Mexico. At Wednesday’s lease sale of nearly 40 million acres, BP got back in the game in a big way.
The lease sale attracted a total of more than $850 million in high bids, of which BP was the high bidder on 24 leases, with bids totaling nearly $42 million. That represented the fifth highest total of high bids from 50 companies making bids in the sale.
The sales big spender was Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX) which posted 16 high bids, totaling just over $321 million. Chevron Corp. (NYSE: CVX) offered six high bids, totaling $106 million, followed by Murphy Oil Corp. (NYSE: MUR) with 16 high bids, totaling nearly $50 million, and Royal Dutch Shell PLC (NYSE: RDS-A) with four high bids, totaling more than $45 million.
For BP the sale marks its reentry to exploration in the deep water Gulf of Mexico, where an explosion at the company’s Macondo well in April 2010 killed 11 workers and dumped 5 million barrels of crude oil into the sea.
For BP this was a coming-out party, the results of which will not be known for years. The company’s market value is still down by more than a quarter compared with its value before the disaster.
As part of its readmission to the federal government’s good graces, the company is employing a safety monitor appointed by the U.S. government who will oversee BP’s operations in the Gulf of Mexico for up to four years. The federal restrictions were first imposed in November of 2012, and BP was not allowed to participate in the past three Gulf lease sales.