The U.S. Bureau of Ocean Energy Management (BOEM) has proposed offering all available blocks of the federal Gulf of Mexico (GoM) waters during a lease sale set for March.
Lease Sale 257 would be the first of 2021 and the eighth offshore sale of the current Outer Continental Shelf Oil and Gas Leasing Program.
The proposed notice of sale was released Nov. 17, a day before Lease Sale 256—postponed from August—takes place amid continued COVID-19 pandemic concerns.
“Despite circumstances imposed by the coronavirus, we are confident that industry remains interested in acquiring new leases to support their portfolios,” Mike Celata, Director of BOEM’s Gulf of Mexico Region, said in a news release. “The Gulf of Mexico is a world-class resource area that serves a key role in our nation’s energy security.”
BOEM estimates the GoM, which spans some 160 million acres, holds about 48 billion barrels of undiscovered technically recoverable oil and 141 trillion cubic feet of undiscovered technically recoverable gas.
Participants in the lease will have a chance to bid on blocks in the western, central and a small part of the eastern GoM. As with other lease sales, Sale 257 would exclude 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, BOEM said.
Terms of the sale include a 12.5% royalty rate for leases in water depths of less than 200 m and 18.75% for other leases.
“Revenue received from OCS leases, including high bids, rents and royalties support the treasuries of the Gulf Coast states of Texas, Louisiana, Mississippi, and Alabama,” BOEM said in the release. “Portions also go to the U.S. Treasury and two nationwide programs, the Land and Water Conservation Fund and the Historic Preservation Fund. In Fiscal Year 2020, almost $353 million in revenue from oil and gas development in the Gulf was distributed to these states and programs.”
More information on Sale 257 is available on BOEM’s website.
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