allows companies to exchange certain existing leases in
moratorium areas for bonus and royalty credits to be used on other
GOM leases.
Access to Acreage for Leasing
The law requires that 8.3 million acres be offered for
oil and gas leases. This acreage is included in both the Central Gulf
Planning Area and the Eastern Gulf Planning Area. Approximately 2
million acres in the Central Gulf was first offered for lease after
enactment of the law was and was included in Lease Sale 205 in October
2007. Approximate .5 million acres in the Eastern Gulf received
additional environmental review and is being offered in Lease Sale 224
in March 2008.
The remaining 5.8 million acres in the Central Gulf is
undergoing environmental review and is expected to be offered in Lease
Sale 208 in 2009.
The Act also created revenue sharing provisions for
four Gulf oil and gas producing States – Alabama, Louisiana,
Mississippi and Texas, and their coastal political subdivisions. There
are two timeframes involved in revenue sharing. From Fiscal Year 2007
through Fiscal Year 2016, 37.5 percent of all revenue including bonus
bids, rentals and production royalty will be shared among the four
States and subdivisions for those new leases in the
.5 million acres in the Eastern Gulf and the 5.8 million acres in the
Central Gulf.
Revenue Sharing
There is a cap of $500 million for qualified OCS revenues shared
beyond 2016.
From Fiscal Year 2017 and beyond, the four States and
subdivisions will share 37.5 percent of revenues from all Gulf leases
issued after December 20, 2006.
GOMESA funds are to be used for coastal conservation,
restoration and hurricane protection.
Extended Moratorium
The Act also updated moratoria areas in the Gulf.
Those tracts in the Eastern Gulf of Mexico that are within 125 miles
of Florida, all tracts east of the Military Mission Line, and tracts
in the Central Gulf of Mexico within 100 miles of Florida that are
included in the moratorium area which extends until 2022.
Credit Exchange for Eligible Leases
The Act also allowed for the exchange of existing
leases in the moratorium areas for bonus or royalty credit to be used
in the Gulf of Mexico.
A credit will be provided to lessees who relinquish
certain eligible leases in the Gulf of Mexico. Leases are considered
eligible if they lie within 125 miles off the Florida coast in the
Eastern Planning Area or within 100 miles off the Florida coast in the
Central Planning Area. The lessees will be allowed to use the credits
in lieu of monetary payment for either a lease bonus bid or royalty
due on oil and gas production from most other leases in the Gulf of
Mexico or transfer the credits to other Gulf of Mexico lessees for
their use.