While new exploration efforts in Brazil's active Santos basin have been temporarily cut off, awaiting a governmental decree on the role that Petrobras (NYSE:PBR) will play in future activity in the area, the Gulf of Mexico has once again become a center of deepwater interest. In some respects, it's an area we all too often forget about in favor of more glamorous locations like Brazil and, more recently, Angola.

Admittedly, the shallow Gulf has become moribund, with far fewer rigs working there than was the case a year ago. But the deeper waters continue to generate interest. And in that regard, Europe's BP (NYSE:BP) is becoming a shining star -- but more on that later.

The most recent deepwater Gulf discovery occurred at the tail end of last month when a group that included Shell, Anadarko (NYSE:APC), and StatoilHydro (NYSE:STO) was successful in the Mississippi Canyon in a little more than 4,000 feet of water. The resulting well, called Vito, is far deeper than anyone even considered when I was walking the halls of an offshore drilling contractor.

Beyond that, the Minerals Management Service continues to make additional tracts available to the producers through a stream of lease sales. The latest -- just last week --covered the Western Gulf and was something of a disappointment in some quarters, generating only $115 million in high bids, versus $484 million for a similar sale in 2008 corresponding to a 50% drop in bidding companies. Interestingly, of the tracts that received bids, 80% were deepwater oil plays.

Let's take a quick look at the high bidders in the sale and the amount each expended:


Winning Bids

Total Spent (millions)




ConocoPhillips (NYSE:COP)






Chevron (NYSE:CVX)



ExxonMobil (NYSE:XOM)



BP, which (as you can see) isn't shy about shelling out for Gulf of Mexico assets, proclaims in a section of its website that it's "Number One in the Gulf of Mexico" and has been purchasing deepwater leases since the 1980s. That has resulted in more than 650 leases in the Gulf in waters deeper than 1,250 feet, and BP speculates that the Gulf's deeper waters contain more than 40 billion barrels of oil and gas.

It seems that almost daily I become more impressed by BP and the accomplishments of CEO Tony Hayward and his crew. I'd strongly suggest that Fools with a taste for energy keep their eyes fixed on this rapidly improving company, along with its activities in the Gulf of Mexico and elsewhere.

BP has been awarded a full five stars by Motley Fool CAPS players. Does that status include your vote?

Fool contributor David Lee Smith doesn't own shares in any of the stocks mentioned. Petroleo Brasileiro and StatoilHydro ASA are Motley Fool Income Investor selections. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has a disclosure policy that is ever so deep.