GoA BBG2 lease sale spending down 85% compared to BBG1, but strategic trends continue

• Intense competition emerges for four adjacent Green Canyon blocks with limited exploration history

• Reduced 12.5% royalty rate under Big Beautiful Gulf programme supports stronger economics ahead of August rebound

The US Bureau of Ocean Energy Management (BOEM) concluded Lease Sale Big Beautiful Gulf 2 (BBG2) on 11 March 2026. The sale attracted US$47 million in high bids, with total activity down 84% compared to December's BBG1 sale. 

"This was a dramatically smaller affair, but it showed a focused, high-conviction approach. Fewer companies showed up, but those that did competed intensely on a select handful of targets," said Caitlin Shaw, Head of Gulf of America (Gulf of Mexico) and Canada Upstream Research. 

 Focused bidding pushes per-acre values up 7% 

Despite lower aggregate spending, deepwater high bid per acre increased 7.4% to US$334/acre versus BBG1. Only 25 blocks received bids from 13 companies, compared to 181 blocks and 30 companies in December. 

"The compressed three-month timeline largely explains the reduced activity. Companies that bid aggressively in December had limited time and budgets to reload for this round," said Shaw. 

 BP secures top position with massive single bid 

BP topped all bidders with US$22 million across multiple blocks, marking their second consecutive lease sale victory BP's US$21 million bid for Green Canyon 404 was the standout - the highest single bid in either BBG sale to date Chevron secured second place with US$11 million, winning adjacent blocks GC448 and GC492 for US$5.0 million and US$5.9 million respectively 

 Green Canyon emerges as exploration hotspot 

The sale's dominant theme centred on Green Canyon, where four adjacent blocks (GC404, GC405, GC448, GC492) attracted the most competitive bidding: 

GC404: BP's US$21 million winning bid beat Shell, Oxy, Woodside and Chevron GC448 and GC492: Chevron outbid the same consortium with seven-figure bids. The area represents potential northern extension of the 20K-psi inboard Paleogene play, 30 miles from Chevron's Anchor field. 

 Strategic partnerships and notable absences 

Harbour leveraged its recent LLOG acquisition, spending US$2.1 million on blocks near Buckskin Private consortium Houston Energy, Red Willow, Navitas, and CL&F returned with joint bids Major players Murphy, Beacon, Equinor, Repsol, and Talos - all top-10 BBG1 spenders - sat out this round. 

 Market poised for rebound in H2 2026  

"With another sale expected in August 2026 and fresh seismic data continuing to mature across the central Gulf of America, we expect activity to rebound later this year, particularly from the independents and mid-caps that sat out this round," said Miles Sasser, Senior Research Analyst at Wood Mackenzie. 

The reduced 12.5% royalty rate under the Big Beautiful Gulf programme continues to underpin stronger per-acre economics, positioning the August sale for renewed competition as companies reload their exploration portfolios.