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The hypoxic zone on the Louisiana Continental Shelf (LCS) forms each summer due to nutrient‐enhanced primary production and seasonal stratification associated with freshwater discharges from the Mississippi/Atchafalaya River Basin (MARB). Recent field studies have identified highly productive shallow nearshore waters as an important component of shelf‐wide carbon production contributing to hypoxia formation. This study applied a three‐dimensional hydrodynamic‐biogeochemical model named CGEM (Coastal Generalized Ecosystem Model) to quantify the spatial and temporal patterns of hypoxia, carbon production, respiration, and transport between nearshore and middle shelf regions where hypoxia is most prevalent. We first demonstrate that our simulations reproduced spatial and temporal patterns of carbon production, respiration, and bottom‐water oxygen gradients compared to field observations. We used multiyear simulations to quantify transport of particulate organic carbon (POC) from nearshore areas where riverine organic matter and phytoplankton carbon production are greatest. The spatial displacement of carbon production and respiration in our simulations was created by westward and offshore POC flux via phytoplankton carbon flux in the surface layer and POC flux in the bottom layer, supporting heterotrophic respiration on the middle shelf where hypoxia is frequently observed. These results support existing studies suggesting the importance of offshore carbon flux to hypoxia formation, particularly on the west shelf where hypoxic conditions are most variable.