BOEM informs (post below) that Wednesday’s BBG1 oil and gas lease sale will be streamed live here at 10 AM ET. Given that this is the first sale in two years and the first BBG sale, some dignitaries may be in attendance.
Posts Tagged ‘BBG1’
Lease sale live stream
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged BBG1, lease sale, live stream, oil and gas on December 8, 2025| Leave a Comment »
Will bearish oil price forecasts constrain bidding at Gulf lease sale?
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged BBG1, deepwater development, Gulf of America, JPMorgan, oil and gas lease sale, oil price forecast on November 26, 2025| Leave a Comment »
In JPMorgan’s view, the stage is set for a potential decline of as much as 50% in oil prices through the end of 2027, taking Brent crude down to the low $30s per barrel range from its current level of around $63.50.
Will bearish forecasts by JPMorgan and others temper bidding at the highly anticipated, and long awaited, Gulf lease sale to be held on 12/10/2025? Probably not for these reasons:
- This will be the first lease sale in 2 years.
- The terms are very attractive.
- Given the longer term nature of deepwater development, production will not begin for years following lease issuance. Note that anticipated first production for 3 new high-pressure deepwater projects, Kaskida, Sparta, and Tiber, will be 23, 16, and 21 years after the field discovery dates.
- To the extent that price forecasts are reliable at all (see no. 9 in the image below), the degree of uncertainty for longer term forecasts is particularly high.
- The sale has to live up to its name Big Beautiful Gulf 1 (BBG1). 😉
One Big Beautiful Lease Sale? We shall see.
Posted in energy policy, Gulf of Mexico, Offshore Energy - General, tagged BBG1, big beautiful Gulf of America, Gulf of America lease sale, low rental rates, low royalty rates on November 11, 2025| Leave a Comment »
The first ever Gulf of America oil and gas lease sale 😉 will be held on Dec. 10, 2025. Instead of numbering the sale sequentially (i.e. Sale 262), the sale has been designated OCS Oil and Gas One Big Beautiful Bill Act Lease Sale 1 (BBG1). 🙄 This change is a bit too cute for some of us old-timers, but we’ll judge the sale by its results, not its name.
The Notice of Sale is attached. The terms are very attractive, with the lowest allowable royalty rate (1/8th) on all shelf and deepwater leases. Note the comparison of royalty rates in the table below. The 6.25% difference for deepwater leases is substantial when you consider their high production potential.
| Gulf Sale No. | Date | % royalty: <200m water depth | % royalty: >200m water depth |
| 256 | 11/18/2020 | 12.5 | 18.75 |
| 257 | 11/17/2021 | 12.5 | 18.75 |
| 258 | 12/30/2022 | 18.75 | 18.75 |
| 259 | 3/29/2023 | 18.75 | 18.75 |
| 261 | 12/20/2023 | 18.75 | 18.75 |
| BBG1 | 12/10/2025 | 12.5 | 12.5 |
The rental rates for the BBG1 Sale are also very attractive compared to Sale 261:
| Water Depth | Sale 261 rental rates ($/ac) | BBG1 Sale rental rates ($/ac) |
| 0 to <200m | years 1-5: $10 year 6: $20 year 7: $30 year 8+: $40 | years 1-5: $7 year 6: $14 year 7: $21 year 8+: $28 |
| 200 to <400m | years 1-5: $16 year 6: $32 year 7: $48 year 8+: $64 | years 1-5: $11 year 6: $22 year 7: $33 year 8+: $44 |
| 400+ m | years 1-5: $16 year 6: $22 year 7: $22 year 8+: $22 | years 1-5: $11 year 6: $16 year 7: $16 year 8+: $16 |
Will the bidding reflect the very favorable lease terms?
Bud's Offshore Energy (BOE) 