Trump administration reduces royalty rates in sale of U.S. oil and gas

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They offer 76 million acres in the Gulf of Mexico and reduced royalty rates for shallow-water rent to stimulate drilling during the period of low oil prices.

Ryan Zinke, the U.S. Interior Secretary said the sale on Aug. 16 would offer leases offshore Texas, Louisiana, Mississippi, Alabama and Florida for exploration and development. The sale will be the first of the administration's 2017-22 National Outer Continental Shelf Oil and Gas Leasing Program.

Last week, Zinke signed a decree on extending the term of the lease and accelerating the approval of permits for oil and gas exploration. The process, which, according to him, got bogged down under former President Barack Obama.

Zinke told reporters on Thursday that the offshore royalties returned about $ 18 billion to taxpayers in 2008, before Obama took office, but last year fell to $ 2.6 billion.

The Interior Department said it would lower royalty rates for shallow-water leases in the August sale to encourage drilling by oil companies, which have faced lower profits during years of sustained low global crude prices.

Energy companies will pay 12.5% royalties for the rental less than 200 meters of water, instead of a rate of 18.75% that had been proposed earlier.

Vincent DeVito, counselor to Zinke on energy policy, believed that the rate change reflected the willingness of this administration to respond quickly to economic indicators.