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BOEM holds lease sale 256, proposes new sale for March

The US Bureau of Ocean Management (BOEM) announced that region-wide Gulf of Mexico Lease Sale 256, held 18 November, generated $120,868,274 in high bids for 93 tracts covering 517,733 acres in federal waters of the Gulf of Mexico. A total of 23 companies participated in the lease sale, submitting $135,558,336 in total bids.

Lease Sale 256 included 14,862 unleased blocks located from 3 to 231 miles offshore, in the Gulf’s Western, Central and Eastern Planning Areas in water depths ranging from 9 to more than 11,115 ft.

Lease Sale 256, livestreamed from New Orleans, was the seventh offshore sale held under the 2017-2022 National Outer Continental Shelf (OCS) Oil and Gas Leasing Program. It had been delayed from its planned August 2020 date to allow time for additional analysis of oil and gas markets in light of the COVID-19 pandemic.

In addition, the BOEM has proposed to offer approximately 78.2 million acres for a region-wide Gulf of Mexico lease sale for March 2021. Lease Sale 257 will be the eighth offshore sale under the 2017-2022 OCS Oil and Gas Leasing Program. The sale will include approximately 14,594 unleased blocks – all of the available unleased areas in federal waters of the Gulf of Mexico.

The Gulf of Mexico OCS is estimated to contain approximately 48 billion bbl of undiscovered technically recoverable oil and 141 trillion cu ft of undiscovered technically recoverable gas.

In 2019, American offshore oil production reached a record 596.9 million barrels, or 15% of domestic oil production. It also generated $5.7 billion in direct revenues to the government. Additionally, offshore oil and gas supported 275,000 total domestic jobs and $60 billion total economic contributions in the US.

Revenue received from OCS leases support the Gulf Coast states of Texas, Louisiana, Mississippi and Alabama.  Portions of the revenue also go to the US Treasury and two nationwide programs, the Land and Water Conservation Fund and the Historic Preservation Fund.

BOEM research supports deepwater policy change

The US Bureau of Ocean Energy Management (BOEM) has published research indicating certain economic policy changes may help increase oil and natural gas production in the Gulf of Mexico, using existing deepwater infrastructure. The study recommended updating economic parameters used by the Bureau of Safety and Environmental Enforcement in the evaluation of certain special case royalty relief applications. This research examined future wells using subsea tiebacks, including extended-reach tiebacks, that require high-cost enhanced flow assurance technologies, such as subsea booster pumps.

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