Third Gulf oil lease auction in 8 months brings in $82.7M

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(The Center Square) – The federal government’s auction of offshore oil leases in the Gulf of America on Wednesday brought in $82.7 million in high bids, as participating companies showed strong interest in waters just off the south Texas coast and ultra-deepwater areas.

The Marine Minerals Administration’s third auction of Gulf acreage in eight months, Big Beautiful Gulf 3 (BBG3), took place at the National WWII Museum, with 16 companies submitting 69 total bids on 59 tracts.

While the numbers did not match the $280 million BBG1 sale in December 2025, there was more interest than in the BBG2 auction in March, which brought in just $47 million across 25 blocks, according to data provided by the Marine Minerals Administration, or MMA.

Combined, the three lease sales over the last eight months generated $410.1 million in high bids. In the Biden presidency, the agency held two lease sales, both in 2023, with each mandated by the Inflation Reduction Act. Lease Sale 259 took in $263.8 million in March 2023, followed by Lease Sale 261 in December, yielding $382.2 million—the single highest total for an auction in nearly a decade.

Interior Secretary Doug Burgum linked the BBG3 lease sale to American energy production and the 250th anniversary of the nation’s independence. “As America marks 250 years of independence, this lease sale reminds us that energy has always been tied to American freedom, strength and prosperity,” Burgum said in an agency release.

Burgum added that “BBG3 advances President Trump’s American Energy Dominance agenda by strengthening energy security, supporting good-paying jobs and helping ensure families have access to reliable, affordable energy.”

The One Big Beautiful Bill Act, signed by President Trump on July 4, 2025, mandated a schedule of 30 Gulf of America lease sales over a 15-year period.

“Lease Sale BBG3 reflects MMA’s continued work to provide the predictable offshore leasing schedule Congress directed and industry needs to make long-term investment decisions,” said Acting Marine Minerals Administration Director Matt Giacona. “

Federal waters in the Gulf of America account for about 13% of total U.S. crude oil production. According to the U.S. Energy Department’s Energy Information Administration, crude oil production in the Gulf is forecast to average 1.91 million barrels per day in 2026, a seven-year high, but decline next year to 1.89 million barrels per day.

BBG3 bid sheets revealed intense competition over key deepwater acreage, particularly Keathley Canyon Block 258, the subject of a rare four-way bidding war between industry giants BP, Chevron, Shell, and Anadarko. A nearby tract, Block 430, drew bids from Chevron, Shell, and Anadarko.

These deepwater blocks, where wells are drilled to depths of about 30,000 feet below the seafloor, are in water roughly 6,000 feet deep, located approximately 275 miles southwest of New Orleans and 250 miles southeast of Houston.

Meanwhile, independent operator Arena Energy bid aggressively on nearshore blocks in the Matagorda Island area of South Texas, near Corpus Christi. Because the Matagorda Island blocks sit right off the Texas coast, running crew boats, staging supply vessels, and scheduling helicopter transports will be done through maritime logistics hubs like Freeport, Port O'Connor, and the Corpus Christi, providing a boost to the regional economy.

Industry leaders, including National Ocean Industries Association (NOIA) President Erik Milito, said offshore projects typically require a decade or more to move from a lease to active production. “A predictable leasing program gives companies the confidence to invest billions of dollars in projects that will sustain domestic production, strengthen supply chains, and reduce reliance on foreign energy,” Milito said in a statement emailed to The Center Square.

Environmental advocates contend that drilling noise and increased vessel traffic pose direct threats to the fragile Gulf ecosystems.

“Opening up millions of highly sensitive acres—including critical habitats for the endangered Rice's whale—sacrifices vital marine life in the name of corporate profit,” said Earthjustice Senior Attorney Eartha Cruz. She also warned that extreme deepwater oil drilling risks catastrophic spills that coastal emergency teams are not equipped to handle.

Under the Gulf of Mexico Energy Security Act (GOMESA), a federal revenue-sharing program, 37.5% of the oil and gas leasing revenue is funneled back to Gulf states using a formula based on distance from the oil or gas production site. The closer a drilling site is to a state’s coastline, the more money that state and its local counties receive. In 2025, Louisiana and its communities received $203 million in GOMESA disbursements, while Texas and its local areas received $124.5 million.