White House restarts federal oil and gas sales next week

The Biden administration quietly announced Friday that it is resuming the sale of oil and gas leases on federal lands next week — almost exactly 15 months after President Biden imposed a moratorium on such sales when he took office.

The announcement of the pending sales by the Interior Department’s Bureau of Land Management (BLM) represents a volte-face by the White House, which had resisted pressure from energy companies to open up more land for drilling, instead insisting that thousands of previously approved leases were unused.

The renewed lease sales are the latest move by the Biden administration to bolster the country’s energy supply, with the average price of a gallon of gasoline remaining stubbornly above $4.

In its announcement, the Department of the Interior said BLM would make approximately 144,000 acres of federal land available for lease starting Monday – an 80% reduction in the area originally considered for oil and gas exploration.

The ministry also announced that energy companies will have to pay the government royalties amounting to 18.75% of the value of what they extract from any new lease, up from 12.5% ​​previously.

“How we manage our public lands and waters says a lot about what we value as a nation. For too long, federal oil and gas leasing programs have prioritized the needs of extractive industries above local communities, the natural environment, the impact on our air and water, the needs of tribal nations and additionally other uses from our shared audience. land,” Interior Secretary Deb Haaland said in a statement. “Today we begin to reset how and what we consider the highest and best use of American resources for the benefit of all present and future generations.”

Biden imposed a moratorium on the sale of new leases a week after his inauguration, but the order was later blocked by a federal judge in Louisiana who granted a preliminary injunction to 13 states who claimed they would suffer “harm irreparable” by the move of the White House.

U.S. District Judge Terry Doughty ruled that only Congress had the authority to suspend offshore oil and gas leases and ordered plans resume for deferred lease sales for the Gulf of Mexico and Alaska.

Friday’s announcement marked the first confirmation from the administration that lease sales on federal lands would resume since that decision.

Biden and his allies have repeatedly accused energy companies of restricting supply by allowing thousands of drilling permits to sit unused. According to BLM, 9,173 unused Drilling Permit Applications (ODAs) had been approved as of December 2021, while another 4,621 ODAs were pending approval.

However, Republicans and industry officials said the White House argument over unused leases was meant to distract from the administration’s anti-energy policies.

“First of all, not all leases are approved,” Sen. Marco Rubio (R-Fla.) told Fox News last month. “Companies ask for all kinds of leases, and they decide, ‘Well, this area is more productive, that makes sense. [to drill there]’… others may not make as much sense.

“You also have a bunch of these places tied up in litigation, and then you have a hostile administration … which has been very, very clear that they want America to produce less natural gas and less oil and to become greener . This has been a fundamental fact,” added Rubio. “So who is going to risk capital under an administration whose entire administrative power is focused on making it harder than ever to explore for and produce fossil fuels like oil or natural gas? They won’t.

Sallie R. Loera