A Return to Normalcy: 
A Baseline Case for Energy Progress

In January 2025, Energy & Industrial Advisory Partners (EIAP) released a study, commissioned by API, entitled, The Economic Impacts of a Consistent Offshore Oil and Natural Gas Legislated Leasing Program. The study modeled three leasing scenarios:

1. Base Case: Current federal five-year program with one Gulf of America lease sale every other year, and no Alaska lease sales.
2. Legislative Leasing Case: A proactive approach featuring two Gulf of America lease sales per year and semi-annual lease sales in Alaska’s Cook Inlet.
3. No Leasing Case: Ending offshore leasing after the current program concludes.

The passage of the One Big Beautiful Bill Act (OBBBA) in July 2025 mandates an average of two oil and gas lease sales per year in the Gulf of America over 15 years. This is not a radical change – it reflects the long-standing norm upheld by Republican and Democratic administrations alike for decades. For the offshore industry, this provides something it has been missing for years: normalcy and predictability.

The EIAP study underscores just how important certainty is. A consistent leasing program delivers billions in capital investment, hundreds of thousands of high-paying jobs, billions in government revenues, and high production that secures U.S. energy independence.

Source: Energy and Industrial Advisory Partners

Key Findings: 2025–2034 Impact (10-Year Reconciliation Window)

Under a Legislative Leasing Program:

• Capital Spending: Annual offshore oil and gas investment would rise by $1.4 billion on average.
• Employment: Nearly 16,000 more jobs would be supported annually.
• GDP Growth: Annual contributions to GDP would increase by $1.3 billion.
• Government Revenues: Federal revenue would rise by an average of $230 million per year.
• Production Growth: Offshore production would be 40,000 barrels of oil equivalent (BOE) per day higher on average—and 140,000 BOE per day higher by 2034.

Even Greater Gains Beyond 2034: Full Forecast Period (2025–2040)

Over the full forecast horizon, the benefits compound significantly:

• Annual Capital Investment: Increases by $4.8 billion by 2040.
• Employment Growth: 56,000 additional jobs supported by 2040.
• GDP Contribution: $4.6 billion more annually by 2040.
• Government Revenues: An additional $1.7 billion per year by 2040.
• Production Growth: Offshore oil and gas production would be 510,000 BOE per day higher by 2040—securing U.S. energy independence and supply resilience.

The Bottom Line: Certainty Unlocks Growth

Offshore oil and gas development is a decades-long endeavor requiring massive upfront investment, complex engineering, and long-term confidence. With OBBBA mandating lease sales at a predictable cadence, the U.S. offshore industry now has a stable foundation to build on its world-class expertise and its strategic national importance.

But leasing certainty alone is not enough. These benefits will only be realized if the permitting and regulatory regime keeps pace. Permitting reform is one of the few areas of genuine bipartisan agreement in Congress. By streamlining offshore permitting processes, aligning agency reviews to avoid unnecessary delays, and ensuring consistent, science-based regulatory oversight, policymakers can pair leasing certainty with regulatory clarity.

That means:

• Streamlining offshore permitting processes
• Aligning agency reviews to avoid unnecessary delays
• Ensuring science-based, consistent regulatory oversight
• Enabling technology innovation and safe project delivery

When leasing stability and permitting reform are aligned, the Gulf of America will continue to set the global standard, strengthening U.S. energy security, boosting jobs and revenues, and cementing America’s role as the world leader in responsible offshore energy production.

When paired with regulatory clarity, a stable leasing program will:

• Provide investment certainty
• Strengthen U.S. energy security
• Boost employment and GDP
• Maximize government revenues
• Sustain long-term domestic production capacity