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The
NewsRoom
Release: #3240
Date: February 17, 2005
Strong
bids mark joint MMS-Wyoming crude sale
Contracts for approximately 2,100 barrels per day of
Royalty in Kind crude oil were awarded to seven companies this month
as part of a joint sale conducted by the Department of the Interior’s
Minerals Management Service and the State of Wyoming.
The sale, which included both Federal and State of
Wyoming crude oil, drew strong interest with bids received from 11
companies, including several refineries. The six-month contracts call
for deliveries to begin April 1, 2005.
Winning bidders included Teppco Crude Oil, L.P.;
Nexen Marketing U.S.A., Inc.; ChevronTexaco Corp.; Flying J Inc.;
Suncor Energy (U.S.A.) Inc.; Tesoro Refining & Marketing Company; and
Marathon Oil Company. Awards included all of the offered sweet and
portions of the asphaltic and Green River condensate. No general sour
production was awarded.
The February sale represents the 14th in a series of
joint sales dating back to 1998 when the State of Wyoming and MMS
first entered into the Wyoming Oil Pilot Program. For this sale, as in
previous sales, MMS and the state took their royalties “in kind,” in
the form of oil, as opposed to “in value,” or cash payments, and
competitively sold the commodities in the marketplace.
Following earlier feasibility studies and pilot
projects, MMS has determined that RIK will be an integral part of its
approach to manage mineral royalties, to be used in tandem with
royalties in value. Among the objectives of the effort are to return
fair value on the public’s royalty assets, reduce regulatory costs and
reporting requirements, shorten the compliance cycle, and improve
overall business efficiencies. In addition, taking royalties in kind
in the form of product simplifies audits and can potentially reduce
the number of audits performed of royalty-in-value cash payments.
MMS, part of the U.S. Department of the Interior,
oversees 1.76 billion acres of the Outer Continental Shelf, managing
offshore energy and minerals while protecting the human, marine, and
coastal environments through advanced science and technology research.
The OCS provides 30 percent of oil and 23 percent of natural gas
produced domestically, and sand used for coastal restoration. MMS’s
collects, accounts for, and disburses mineral revenues from Federal
and American Indian lands, with Fiscal Year 2004 disbursements of
approximately $8 billion and more than $143 billion since 1982. The
Land and Water Conservation Fund, which pays for acquisition of state
and federal park and recreation land, gets nearly $1 billion a year.
Relevant Web Sites:
MMS Main Website
Media Contacts:
Patrick
Etchart
(303) 231-3162
MMS: Securing Ocean Energy & Economic Value for
America
U.S. Department of the Interior
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