ABSTRACT
Data employed in this chapter are published by the United States Department of Interior, in the Outer Continental Shelf Statistical Summary: 1954-1972, along with supplements issued following each federal offshore sale since 1972. One variable frequently employed was the natural logarithm of bid. Since bids are generally acknowledged to fit a lognormal distribution, ln is approximately normal. Use of ln rather than absolute bid eliminates the overwhelming influence of large outliers in the data characteristic of a lognormally distributed variable. In order to explain the amounts bid in offshore sales, and to measure the impact of joint ventures, tract quality is an essential variable. An estimate of tract quality probably influences a bid more than any other single factor. Data available after a tract has been developed might be used to estimate how much the tract should have been worth at the time of its sale. Actual production and cost records of tracts leased are available.
