Call for Congressional Action: NOIA President’s Response to Lease Sale 261

For Immediate Release: Wednesday, December 20, 2023

Call for Congressional Action: NOIA President's Response to Lease Sale 261

Washington, D.C. - National Ocean Industries Association President Erik Milito issued the following statement after the conclusion of Gulf of Mexico Lease Sale 261:

"Today signifies a critical point in American energy policy. The U.S. offshore oil and gas industry is stepping up and making the investments vital to enhance our energy, economic, and national security for decades to come. However, the offshore industry’s commitment to American energy security and affordability comes at a time of significant and unnecessary uncertainty. Without Congressional intervention, this is the final lease sale until at least 2025. In our forward-thinking industry, securing new lease blocks is vital for exploring and developing resources crucial to the U.S. economy. Additional offshore acreage is necessary to sustain and expand energy production in a region known for among the lowest carbon intensity barrels globally.

"The Gulf of Mexico is a prime economic engine and investment area, and this was the last chance for companies to secure leases in the near term.

“Adding to the uncertainty, the administration has not only been unwilling to endorse policies promoting Gulf of Mexico oil and gas production, but it has actively pursued measures discouraging domestic offshore energy production. Over the past three years, the Administration has followed its stated agenda of restricting offshore energy development with tangible actions that include leasing pauses, sale cancellations, permit delays for geophysical research, and arbitrary restrictions related to the Rice’s whale. Potential future actions by the administration could introduce further unwarranted delays or obstacles to domestic energy production. Given recent political dynamics and actions, such complications are well within the realm of possibility and should be of concern to all Americans continuing to grapple with the high costs of inflation.

“In future years without scheduled lease sales, we remain concerned about the potential shift of investment away from the U.S. to energy projects around the world. Historically the U.S. offshore energy regulatory structure has been a competitive advantage. The historic consistency and predictability of the U.S. offshore regulatory framework has resulted in the production of more than 1 million barrels of oil per day since 1997, revenues to the government of more than $120 billion, billions of dollars in funding for the Land and Water Conservation Fund, hundreds of thousands of good-paying jobs, and production of some of the lowest carbon intensity barrels of oil in the world. However, without opportunities for investment in new leasing we are concerned that American jobs, American energy production, our national security, and environmental progress will be at risk.

"Without annual opportunities for investment here in the U.S., the investment necessary to fuel the U.S. and global economies will simply shift to other parts of the world, including regions with potentially lower environmental standards and higher emissions.“The nation's energy, economic, and security future hinges on annual lease sales in the Gulf of Mexico to secure new acreage. We urge Congress to promptly act on and pass the numerous bicameral and bipartisan bills that enhance predictability and certainty for American offshore energy leasing. Legislation like the Offshore Energy Security Act and its House companion, the BRIDGE Production Act, provides essential solutions to fortify our nation's energy outlook.”


Further Context
Mandated by the Inflation Reduction Act, and needlessly delayed due to meritless litigation and political decisions, Lease Sale 261 is the final Gulf of Mexico lease sale scheduled under the Obama-era offshore oil and gas leasing program, which actually expired on June 30, 2022. Moving forward after Lease Sale 261, U.S. offshore oil and gas leasing will be subject to the Biden administration’s 2024-2029 federal offshore oil and gas leasing program, unless Congress takes action to correct the deficiencies of the 2024-2029 program

The Biden administrator’s leasing program offers a mere three offshore oil and gas lease sales in the Gulf of Mexico, scheduled for 2025, 2027, and 2029—a stark departure from the historical norm of at least 10 sales in the Gulf over the program's duration.

Compounding this misstep, the Department of the Interior chose to postpone the requisite lease sale-specific environmental reviews. Traditionally completed concurrently with program development, these reviews take one to two years. Previous administrations, regardless of their political affiliations, diligently followed this process to ensure uninterrupted leasing activities.

Remarkably, the decision to include only three sales in the next oil and gas leasing program will impede momentum behind offshore wind development. To issue offshore wind leases while adhering to the Inflation Reduction Act (IRA), the DOI must offer at least 60 million acres annually for offshore oil and gas leasing.

With only three potential sales spread across five years, the Interior will be unable to comply with the IRA and legally conduct offshore wind lease sales annually through 2029—a critical factor for supporting the growth of renewables along America’s coastlines.

This lack of clarity stifles innovation, restrains economic growth, and risks diverting investments to other regions worldwide. Despite the Gulf of Mexico's abundant reserves of hydrocarbons, skilled workforce, and robust infrastructure, the region's attractiveness for energy development is at risk without access to new acreage and energy projects.

The Gulf of Mexico is a lifeline that supports hundreds of thousands of jobs, attracts billions in investments, and generates substantial government revenue. Additionally, it produces among the lowest carbon barrels of oil in the world. As energy demand continues to rise, the Gulf of Mexico clearly represents an environmentally advantageous asset compared to other options globally.


About NOIA
The National Ocean Industries Association (NOIA) represents and advances a dynamic and growing offshore energy industry, providing solutions that support communities and protect our workers, the public and our environment.

National Ocean Industries Association
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