is controlled by the Bureau of Ocean Energy Management (BOEM), and the Bureau of Safety and Environmental Enforcement (BSEE), formerly named the Minerals Management Service (MMS). The BOEM issues leases through competitive bidding by sealed bids. The oil and gas company offering the highest up-front payment to the government (called a bonus) wins the lease. The government also receives a fixed annual rental based on the area for non-producing leases, and a percentage of the market value of any oil or gas produced and sold (royalty). The leases expire after a set number of years, or continue however long afterward that oil and gas are continually produced from the lease. Individual tracts are generally . Current leases being offered in the Gulf of Mexico have 5-year terms for tracts in water depths of less than 400 m, and 8 years for tracts in water greater than 400 m. Royalty rates are 18.75% regardless of water depth. From 1954 through 2004, the federal government received $64 billion in bonuses, $3 billion in rentals, $89 billion in royalties, and $3 billion in taken-in-kind oil deliveries in lieu of royalties. International ownership Some potential petroleum deposits underlie areas outside the EEZ. For example, the North Chuckchi Basin in the Arctic Ocean is partly inside and partly outside the US EEZ. Offshore drilling by area Historically, offshore drilling began by extending known coastal oil- and gas-producing trends out into the ocean. For this reason, most US offshore drilling has taken place offshore Louisiana, Texas, California, and Alaska, areas with coastal onshore oil and gas fields. "Possibly in some future age, when all known petroleum fields shall have been drained of their richness, oil men may seek refuge in King Neptune's realm." - Oil & Gas Journal, 24 June 1915 Alaska The first federal lease sale offshore Alaska was held in 1976. Alaska produces oil and gas from offshore areas in the Cook Inlet and the Arctic Ocean. Endicott Island is an artificial island built to produce oil from beneath the Beaufort Sea. There are currently four artificial islands being used for drilling. By Executive Order dated April 28, 2017, the Bureau of Ocean Energy Management will begin selling offshore leases in 2019. California Offshore drilling began in California in 1896, when operators in the Summerland Oil Field in Santa Barbara County followed the field into the ocean by drilling from piers built out over