The latest Trump administration sale of oil and gas drilling rights in the Gulf of Mexico attracted nearly $82.7 million in high bids on Wednesday, generating more money than a sale in March, but far less than one held in December.
The Trump administration offered more than 80 million acres (32.4 million hectares) in the Gulf of Mexico to drillers as part of an effort to boost domestic energy production with regular offshore lease sales.
The sale is the second since the U.S.-Israeli war with Iran disrupted global crude flows and sent oil prices to four-year highs. It is the third of 30 mandated by U.S. President Donald Trump's 2025 tax cut and spending law that are planned to run to 2040.
Kate MacGregor, deputy secretary of the Department of the Interior, who helped read the bids at a New Orleans museum, said the regular auctions "unleash the promise of offshore oil and gas." Trump's predecessor, former President Joe Biden, campaigned in 2020 on blocking offshore lease sales but held them sporadically after lawsuits.
The Interior Department offered 15,100 blocks located between 3 and 231 miles (4.8 to 372 km) offshore on the U.S. Outer Continental Shelf. Water depths range from 9 feet to more than 11,100 feet (2.7 meters to 3,380 meters).
16 COMPANIES BID
Sixteen companies submitted a total of 69 bids on 330,000 acres, or about 0.4% of the 81 million acres offered in the Gulf of Mexico, an international body of water that Trump renamed the Gulf of America under an executive order.
The second auction in March generated nearly $47 million in high bids for 25 blocks across roughly 141,000 acres. That was far less than the first auction in December mandated by the 2025 law, which yielded $279.4 million in high bids.
Offshore production accounts for about 15% of U.S. output, but has lagged onshore shale fields in recent years because of longer timelines and higher upfront costs.
Companies that won drilling rights included units of BP, Chevron, and Shell.
The energy industry praised the sale even though it attracted less interest than December's.
“Today’s lease sale is about far more than today’s bids," said Erik Milito, president of the National Ocean Industries Association. "It’s about ensuring America has the energy it needs to keep prices affordable, strengthen national security, and power economic growth for decades to come."
Julia Forgie, senior attorney at the Natural Resources Defense Council, criticized the sale as auctioning off ocean waters to the highest bidder. The administration has exempted some oil and gas operations from endangered species law protection. Environmentalists said many of the bids were for leases in deep and ultra-deep water, where drilling is riskiest.
"This lease sale is another unacceptable giveaway that threatens wildlife, coastal economies, and the livelihoods of the people who depend on a healthy Gulf," Forgie said.
(Reuters)
Subscribe
