Today, the Bureau of Land Management (BLM), within the Department of the Interior (DOI), announced the results of an oil and gas lease sale in the Arctic National Wildlife Refuge (ANWR) —the first of four sales mandated by the One Big Beautiful Bill Act (OBBBA).

Only 10% of the tracts offered today were sold, bringing in just $3.7 million in bid revenue. But this wasn’t surprising. The sale offered 58 tracts covering 688,829 acres of public land in the Refuge. Only 5 tracts, covering 72,049 acres, received bids. Bids ranged between $35/acre and $73/per acre, with an average of $52/acre. The minimum legal bid in the sale was $25/acre.

Only two entities participated in the auction. Alaska Industrial Development and Export Authority (AIDEA), a public corporation of the State of Alaska, stepped in amid limited industry interest. AIDEA submitted bids on 5 parcels and won 3. HEX Energy LLC, the only private company that participated in today’s auction, submitted bids on 4 parcels and won 2. HEX, founded in 2019, is a private natural gas production company that currently operates wells in the Cook Inlet and Kenai Peninsula in Southcentral Alaska. AIDEA provided HEX a $7.5 million loan in 2020 to acquire several subsidiaries and provided access to a $50 million line of credit in 2025.

This is not the first time AIDEA has stepped in to bid on Arctic Refuge lease sales because of a lack of industry interest. Although this was the first sale mandated under OBBBA, it was the third congressionally mandated lease sale overall in the Refuge. During the first Trump Administration, Congress authorized an oil and gas leasing program in the 1.6 million acre Coastal Plain of the Refuge and required two lease sales in the 2017 Tax Cuts and Jobs Act to help offset the law’s $1.9 trillion price tag.

The first lease sale, held in January 2021, offered 22 tracts totaling 1,089,053 acres. Only 437,804 acres received bids, generating $16.5 million in revenue, less than 1 percent of what Congress and the Congressional Budget Office (CBO) projected. Only two private companies submitted bids, and both later relinquished their leases. AIDEA submitted 11 bids, all at the minimum bid of $25/acre, and was ultimately awarded nine leases after declining to pursue two of those tracts. The second lease sale, held in January 2025, received no bids and generated no revenue.

As we predicted in our Weekly Wastebasket, today’s result largely mirrors the January 2021 sale, but with even fewer bids and less revenue. Compared to the 2021 lease sale, today’s auction divided the available acreage into much smaller tracts. The 688,829 acres offered were split into 58 tracts rather than 22, with each tract roughly one quarter the size of those offered in 2021. Every tract offered today had already been offered in 2021 but either received no bids or was later relinquished. The five tracts that received bids today were carved from the same acreage that was awarded to two private companies in the first lease sale, only divided into smaller tracts. This means that the tracts that were previously offered and unsold once again received no bids because there is little prospect of any development, yet the federal government keeps reoffering them.

Ahead of today’s sale, AIDEA received approval for $15 million bidding budget and submitted 5 bids totaling $3.5 million. AIDEA won 3 of the tracts it bid on and the other two will be awarded to HEX unless HEX decides not to pursue the leases.

The leases sold today carry a 16.67 percent royalty rate and a rental fee of $10 per acre, the same terms used in the first ANWR sale and for leasing in the National Petroleum Reserve in Alaska.

Today’s result is largely a repeat of what taxpayers saw in 2021. Taxpayers were originally promised $910 million in federal revenue from the first two lease sales and received less than one percent of that amount. The OBBBA-mandated sales were estimated to generate $452 million in federal revenue over ten years (FY2025–2034). While substantially lower than the 2017 estimate, the revenue generated from today’s sale proves that once again, those projections are unlikely to be realized.

The economics of developing the Arctic Refuge have not fundamentally changed. Drilling in a remote and environmentally sensitive region with little supporting infrastructure continues to deter industry investment. No exploratory drilling has occurred in the Refuge, even though AIDEA has been authorized to spend $175 million on seismic testing and other preliminary exploration activities. But AIDEA is a financing authority, not an oil and gas exploration company. It issues low interest, tax exempt bonds to Alaska businesses and has little experience developing oil and gas resources itself.

The leases issued today are unlikely to result in meaningful production. If the leases are eventually transferred to private companies, taxpayers will have effectively paid for the riskiest stage of oil and gas development—acquiring leases and conducting early exploratory activities.

Leasing public lands for oil and gas development in the Arctic Refuge is unlikely to meaningfully increase oil supplies or lower gasoline prices in either the near or long term. Instead, drilling in ANWR will continue to shift costs and risks onto taxpayers while generating far less revenue than promised.