Yesterday, EIAP issued a report for API and NOIA that estimates economic impacts from leasing program delays. The fundamental reason for regular sales has not received much public attention, but is summarized succinctly in the report:
In most cases, additional leases are required to produce an existing field fully or to underpin the economics of processing and transportation infrastructure. It is thus important for the industry to have continued opportunities to secure leases through a predictable leasing program.
Keep in mind that US lease blocks are the smallest in the offshore world, too small for optimal development in deepwater and frontier areas. The smaller the blocks, the greater the importance of regular lease sales. Pictured below is a 2017 graphic graphic which superimposes Kosmos Energy’s blocks off Senegal and Mauritania on the Central Gulf of Mexico. Note that the six West African blocks encompass 36,000 sq km and are the equivalent of 1600 GoM lease blocks.
Bud's Offshore Energy (BOE) 