The Bureau of Ocean Energy Management (BOEM) is set to auction around 80.4 million acres of federal waters in the Gulf of America next month, moving forward with the Trump administration’s offshore oil and gas program.
“Lease Sale BBG2 is an important step in BOEM’s offshore program,” said Acting Director Matt Giacona, noting that the agency sees continued interest from the industry after the initial BBG1 sale.
The auction will cover about 15,066 unleased blocks located 3 to 231 miles offshore at water depths ranging from 9 feet to over 11,100 feet. Some areas will be excluded, such as blocks affected by a September 2020 presidential withdrawal, parts of the Flower Garden Banks National Marine Sanctuary, and any tract that received bids in the BBG1 sale.
This announcement comes during a time of weaker market conditions for offshore leasing. The first BBG1 sale raised $279.4 million in high bids for 181 blocks, with 30 companies placing 219 bids totaling $371.9 million. Though major companies like BP, Chevron, and Shell took part, the results did not match the December 2023 Gulf lease sale, which recorded 352 bids worth $441.9 million across 311 tracts.
The lower bidding comes alongside a drop in oil prices, with WTI trading around $58.50, significantly lower than late-2023 prices. Currently, WTI is about $63 per barrel. To encourage participation, BOEM set royalty rates at 12.5 percent for both shallow and deepwater leases, marking the lowest deepwater rate since 2007.
Despite these challenges, the sale aligns with Executive Order 14154, titled “Unleashing American Energy,” signed by Donald Trump, which pushes federal agencies to speed up offshore energy development.
The Gulf of America’s Outer Continental Shelf covers about 160 million acres and is thought to hold nearly 30 billion barrels of undiscovered, technically recoverable oil, as well as more than 54 trillion cubic feet of natural gas. In fiscal year 2024, this area alone produced $6.5 billion in federal royalties, along with $372.5 million in bonus bids and $122.8 million in rental revenue.
The One Big Beautiful Bill Act requires 30 Gulf lease sales and six Cook Inlet sales in Alaska over the coming decades, securing what BOEM officials call a long-term offshore development plan.
The Lease Sale Big Beautiful Gulf 2 (BBG2) will take place on March 11, 2026, with live bid readings starting at 9 a.m. Central Time. The event will be livestreamed, and BOEM plans to publish the Final Notice of Sale in the Federal Register on February 5, complying with the required 30-day notice period.
For more details about BBG2, including maps and the Final Notice of Sale package, please visit the BOEM website.