Economic evaluation of scheduling outer continental shelf oil and gas lease sales
Previous OCS studies and studies of auction participation have tended to examine either demand or supply issues. This study develops a model of supply and demand for leasing of tracts for the development of OCS oil and gas. An econometric model of the demand for leases is specified using results in the literature on bidding behavior. This estimated demand function is then integrated with supply concerns to develop a mathematical optimization model of supply and demand for leases. This integrated model is used to examine historic and future rates of leasing and the resulting receipt of cash-bonus bids by the government. Alternative specifications of the model are compared to quantify the change in cash bonus revenues associated with various legislative mandates and OCS policy issues. The first policy issue examined is the potential loss in cash bonus revenues which may result from the equitable sharing clause in the OCS Lands Act, whereby the federal lease schedule is required to consider the regional distribution of benefits and costs. Secondly, the recent accelerated leasing of tracts is considered, given that the bids in a particular sale are found to depend upon the total amount of resources offered annually. Finally, the multiple objectives of OCS legislation are considered in terms of the impact on bonus bid revenues.
- Research Organization:
- Rhode Island Univ., Kingston (USA)
- OSTI ID:
- 5923403
- Country of Publication:
- United States
- Language:
- English
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Geology
& Exploration
03 NATURAL GAS
030200 -- Natural Gas-- Reserves
Geology
& Exploration
29 ENERGY PLANNING, POLICY, AND ECONOMY
290200 -- Energy Planning & Policy-- Economics & Sociology
CONTINENTAL MARGIN
CONTINENTAL SHELF
ECONOMETRICS
ECONOMICS
GEOLOGIC DEPOSITS
LEASES
MATHEMATICAL MODELS
MINERAL RESOURCES
NATURAL GAS DEPOSITS
OPTIMIZATION
PETROLEUM DEPOSITS
RESOURCES
SALES
SUPPLY AND DEMAND