NEW ORLEANS, LA (WVUE) - In a move that could pump millions into the Louisiana economy, the federal government is opening new offshore drilling acreage and providing new incentives for shallow water drilling.
A record 77 million acres of offshore leases will soon be open for bid.
"This is the largest sale in U.S. history, offering the most acreage on the outer continental shelf," said John Filostrat with the U.S. Interior Department's Bureau of Ocean Energy Management.
The drilling area being offered is about the size of New Mexico. It will make available for lease all available unleased areas of the Gulf's outer continental shelf.
"The Gulf is seeing deeper and deeper drilling which takes more time and planning, and we're hoping opening new areas will allow them to plan better," said Filostrat.
The proposed lease sale, which will be live-streamed from New Orleans in March of next year, is expected to generate more than $120 million for the U.S. Treasury and Gulf Coast states.
The Interior Department is also offering incentives that could spur drilling in shallow Louisiana waters of 500 feet or less. Such activity has been slow recently, and federal royalties have been reduced by a third.
"From 18.5 percent down to 12.5 percent is what companies would have to pay the government," said Filostrat.
The proposed lease sale, will also open acreage about 125 miles south of the Florida panhandle.
"A small sliver is available, but most of the eastern gulf is off limits," said Filostrat.
Though environmentalists express some concern, the U.S. interior secretary says the lease sale will help create what he calls "regional economic dynamism."
The proposed lease sale in five months is being praised by House Majority Whip Steve Scalise and senators Bill Cassidy and John Kennedy. Scalise says the proposed lease sale is a "bold step" to helping establish America's "energy dominance."
However, the Gulf Restoration Network is not thrilled. They say the last sale didn't raise much money and they say the Trump administration should focus more on offshore drilling safety.