U.S. Interior has announced region-wide oil and gas lease sale Gulf of Mexico

2/13/2019
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U.S. Interior Gulf of Mexico Lease Sale 252. Photo: BOEM.

WASHINGTON – In support of President Donald J. Trump’s America-First Offshore Energy Strategy, Interior’s Assistant Secretary for Land and Minerals Management Joe Balash and Bureau of Ocean Energy Management Acting Director Walter Cruickshank have announced that BOEM will offer 78 million acres for a region-wide lease sale scheduled for March 2019. The sale would include all available unleased areas in federal waters of the Gulf of Mexico.

Lease Sale 252, scheduled to be livestreamed from New Orleans, will be the fourth offshore sale under the 2017-2022 National Outer Continental Shelf Oil and Gas Leasing Program (National OCS Program). Under this program, 10 region-wide lease sales are scheduled for the GoM, where resource potential and industry interest are high, and oil and gas infrastructure is well established. Two Gulf lease sales will be held each year and include all available blocks in the combined Western, Central, and Eastern Gulf of Mexico Planning Areas.

“The development of our abundant offshore resources is a major pillar of this administration’s energy strategy,” said Assistant Secretary Balash. “America benefits from domestic energy production, which provides money for our Treasury, thousands of well-paying jobs, affordable and reliable energy to heat our homes, fuel our cars, and power our economy."

Lease Sale 252 will include approximately 14,696 unleased blocks, located from three to 231 mi offshore, in the Gulf’s Western, Central and Eastern planning areas in water depths ranging from nine to more than 11,115 ft (three to 3,400 m). The following areas are excluded from the lease sale: blocks subject to the congressional moratorium established by the Gulf of Mexico Energy Security Act of 2006; blocks adjacent to or beyond the U.S. Exclusive Economic Zone in the area known as the northern portion of the Eastern Gap; and whole blocks and partial blocks within the current boundaries of the Flower Garden Banks National Marine Sanctuary.

The Gulf of Mexico OCS, covering about 160 million acres, is estimated to contain about 48 Bbbl of undiscovered technically recoverable oil and 141 Tcf of undiscovered technically recoverable gas.

Revenues received from OCS leases (including high bids, rental payments and royalty payments) are directed to the U.S. Treasury, certain Gulf Coast states (Texas, Louisiana, Mississippi, Alabama), the Land and Water Conservation Fund and the Historic Preservation Fund.

“Developing our nation’s offshore energy resources is vital to our economy and energy security,” said Acting BOEM Director Dr. Walter Cruickshank. “Our staff is committed to ensuring offshore development is done in an environmentally responsible manner.”

Leases resulting from this proposed sale would include stipulations to protect biologically sensitive resources, mitigate potential adverse effects on protected species and avoid potential conflicts associated with oil and gas development in the region.

In addition, BOEM has included appropriate fiscal terms that take into account market conditions and ensure taxpayers receive a fair return for use of the OCS. These terms include a 12.5% royalty rate for leases in less than 200 meters of water depth, and a royalty rate of 18.75 percent for all other leases issued pursuant to the sale, in recognition of current hydrocarbon price conditions and the marginal nature of remaining Gulf of Mexico shallow water resources.

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