The United States’ last offshore oil sale for two years!
On 20 December 2023, the Bureau of Ocean Energy Management (BOEM) will open bids in Lease Sale 261 in the Gulf of Mexico. The available waters include roughly 6 million acres that BOEM had tried to remove from the auction to protect the potential habitat of the Rice’s whale, but BOEM lost that challenge in court. The Rice’s whale was only recognized as a distinct species in 2021. The fight over the Rice’s whale area has delayed the lease sale multiple times.
Lease Sale 261 is significant, as it is the last sale currently scheduled for the nation’s offshore oil and gas program. The Biden administration issued a final 5-year program for federal offshore leasing that included 3 offshore lease sales over the next 5 years, which is the lowest number of lease sales in the history of the program. Lease Sale 261 is the final offshore lease sale mandated by the Inflation Reduction Act and is the only offshore sale scheduled to take place until 2025. The historically small schedule of just three offshore oil sales between 2025 and 2029 has prompted harsh criticism from Republicans in Congress and warnings from the oil industry that fewer sales will harm U.S. production in the future.
The Gulf of Mexico federal offshore oil production accounts for 15% of total U.S. crude oil production. Federal offshore natural gas production in the Gulf accounts for 5% of total U.S. dry production. The U.S. Gulf of Mexico produces some of the lowest carbon intensity barrels in the world. Constrained production in this basin could be replaced by higher carbon intensity barrels from elsewhere in the world.
