Editor's note: This story was updated to include Sale 261's statistics from the Bureau of Ocean Energy Management.

After a series of starts and stops prompted by legal actions, oil and gas producers finally got their bids counted for Lease Sale 261 in the Gulf of Mexico (GoM) on Dec. 20. The result was more than two dozen E&Ps placing high bids on 311 tracts spanning 1.7 million acres. The winning bids totaled more than $382.1 million.

Hess Corp. submitted 20 bids and was the highest bidder, doling out approximately $88.3 million. Anadarko Petroleum Corp. submitted the second-most high bids with 49, with the sum reaching $74.2 million. Anadarko also had the single highest bid for one block, spending $25.5 million on Mississippi Canyon Block 389. Shell submitted 65 total bids for a sum of $69 million.

Chevron Corp., Woodside Energy, Equinor, BP, Repsol, Beacon Offshore Energy and Talos Energy were the remaining companies in the top 10 highest bidders. Green Canyon was the most bid-on section during the lease sale, with 75 tracts receiving at least one bid. Hess had the highest bid in the area, spending $21 million on Block 188. Mississippi Canyon had 45 tracts receive bids, with Anadarko’s bid on Block 389 being the highest. Beacon Offshore had the highest bid of $2.4 million in Keathley Canyon, which had 38 tracts receive bids.

Holly Hopkins, American Petroleum Institute vice president of upstream policy, said the sale generated the highest bid amount in nearly a decade, “despite policy headwinds.”

One likely factor for the leasing round’s large bid haul is the scarcity of future leasing opportunities. Lease Sale 261 is the last leasing round scheduled until at least 2025.

After former President Obama’s five-year offshore oil and gas leasing program expired in 2022, the Biden administration recently finalized just three offshore oil and gas lease sales between 2024 and 2029—in 2025, 2027 and 2029.

Producers and opponents of the sale have expressed dissatisfaction with the future leasing scheme. Offshore E&Ps say there are too few sales, which will limit future U.S. energy production. Advocates for renewables and other alternatives—who oppose fossil fuels—want the sales cancelled.

“Without Congressional intervention, this is the final lease sale until at least 2025. In our forward-thinking industry, securing new lease blocks is vital for exploring and developing resources crucial to the U.S. economy,” Erik Milito, president of the National Ocean Industries Association, said in a Dec. 20 press release. “Additional offshore acreage is necessary to sustain and expand energy production in a region known for among the lowest carbon intensity barrels globally.”

Milito said a lack of investment opportunities in the U.S. will just shift to other parts of the world, including regions with potentially laxer environmental standards and higher emissions. “The nation's energy, economic and security future hinges on annual lease sales in the Gulf of Mexico to secure new acreage,” he said.

Athan Manuel, the Sierra Club’s lands protection program director, said in a press release that “each additional oil and gas lease sale makes it harder to achieve the ambitious goals we need to achieve to stave off climate catastrophe.”

Manuel said Sierra Club, a Washington D.C.-based environmental group, sees the world at a “critical moment” in which clean energy should be expanded rather than “locking ourselves into fossil fuel for decades.”

Sale postponed, postponed again

Lease Sale 261 dragged out due to ongoing legal challenges. Originally scheduled to take place Sept. 27, the sale was postponed by the Fifth U.S. Circuit Court of Appeals in New Orleans after the Biden administration, in conjunction with environmental groups in the area, appealed a ruling by the court to add more acreage to the lease sale.

The appeal for additional acreage was approved, but the sale was once again postponed on Nov. 2 to provide for a more orderly process and give bidders more time to make bids after additional acreage was made available. The Bureau of Ocean Energy Management reset the lease on Nov. 16.

Overall, Lease Sale 261 offered a total of 13,482 unleased blocks on 72.7 million acres in the Gulf’s western, central and eastern planning areas. 

A total of 26 companies participated in the sale, submitting 352 bids totaling $441,896,332.