U.S. Interior Distributes $354 Million from Gulf of America Leases

The U.S. Interior Department on March 27 announced the distribution of around $353.6 million in energy revenues to the four Gulf of America gas and oil producing states. The funds, distributed yearly, are generated from offshore gas and oil production and are allocated to support coastal protection, infrastructure projects and restoration. The Gulf of Mexico Energy Security Act enacted in 2006 mandates that a portion of the revenue generated by oil and gas production in the Gulf of America goes to state and local governments. The states receiving the funding are Texas, Alabama, Louisiana and Mississippi.

Louisiana and 19 of its parishes obtained the highest share of the distribution, a sum of $156.3 million, while Texas and 18 of its counties received $95.5 million, the second highest. Mississippi and three of its counties received $51.9 million, and Alabama and two of its counties received a total of $49.8 million.

Industry estimates forecast offshore production to exceed two million barrels per day by 2025-2026, marking a potential all-time  high for the U.S. The Gulf of America continues to be the U.S.’s primary offshore source of gas and oil, accounting for around 97 percent of all U.S. Outer Continental Shelf oil and gas production. Outer Continental Shelf activities produce significant revenues from lease sales, rental fees and royalties on production. These funds are distributed to the U.S. Treasury and a number of other programs through various revenue sharing laws.