Acreage and Royalty Shake-Up: Lowest Rate Since 2007
The agency opened bidding on 81.2 million acres across the Gulf, setting a 12.5% royalty rate—the lowest legally allowed under the July bill. That’s a dramatic drop from the 16.7% rate mandated by former President Joe Biden’s 2022 Inflation Reduction Act, a policy shift BOEM says is designed to spark broader participation.
Royalty revenues will flow to the U.S. Treasury, Gulf Coast states, the Land and Water Conservation Fund, and the Historic Preservation Fund.
Chevron Snaps Up Deep-Water Prize Amid Ongoing Litigation
Chevron delivered Wednesday’s knockout punch with the single largest bid: $18.6 million for drilling rights in the Keathley Canyon deep-water territory—an area prized for complex geology and high-yield potential.
The bid comes just weeks after a Washington federal judge allowed Chevron to intervene in litigation aimed at halting lease sales under the July bill. Chevron argued it has been more aggressive than the federal government in defending offshore leasing rights and should be permitted to join the fight.
