After a two-year suspension from bidding on Gulf of Mexico offshore drilling leases, BP (NYSE:BP) reentered the market by submitting 31 bids and winning 24 tracts for a total price of $41.6 million. Eleven of the tracts are in the Mississippian Canyon, close to site of 2010's Macondo accident off the coast of Louisiana and Alabama, where the company has a familiarity with the geological formation. Although commercial production from the recent bids is not likely for several years, the resource potential, existing infrastructure, and limited geopolitical risks make the Gulf of Mexico an attractive, long-term commitment for the lean BP.
This segment is from Thursday's edition of "Digging for Value," in which sector analysts Joel South and Taylor Muckerman discuss energy and materials news with host Alison Southwick. The twice-weekly show can be viewed on Tuesdays and Thursdays. It can also be found on Twitter, along with our extended coverage of the energy and materials sectors @TMFEnergy.
Joel South and Taylor Muckerman have no position in any stocks mentioned. The Motley Fool recommends and owns shares of Seadrill. It also owns shares of Transocean. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.