John Rodi, regional director for the Bureau of Ocean Energy Management, opened the auction for 21 million acres for oil and gas development in New Orleans.
BOEM said Lease Sale 238 offers more than 4,000 tracts ranging from nine miles to 250 miles off the Texas coast. Water depths range from 16 to more than 10,975 feet.
The agency, a division of the U.S. Interior Department, said the acreage could lead to the production of between 116 million and 200 million barrels of oil and 538 billion and 938 billion cubic feet of natural gas.
The U.S. government placed a brief moratorium on deep water oil and gas drilling in the wake of the Deepwater Horizon tragedy in 2010. Eleven rig workers were killed in an accident that resulted in the worst offshore oil spill in U.S. history.
In May, U.S. Deputy Interior Secretary Mike Connor said the Gulf of Mexico is a "critical component of our nation's domestic energy portfolio."