The Biden administration will auction oil drilling rights to 80 million acres in the U.S. Gulf of Mexico days after joining a global agreement that for the first time targeted fossil fuels as the main driver of global warming, the administration said on Nov. 17.
The sale by the Department of Interior will be the first under President Joe Biden, whose administration paused drilling sales under a promise to end development on federal properties. But Biden lost a court fight to oil-producing states that sued to reinstate the sales.
The administration has appealed and a suit by environmental groups seeking to halt the sale is pending. The U.S. is moving ahead to hold onshore lease auctions in several states early next year.
Interior's Bureau of Ocean Energy Management will auction almost all available unleased Gulf of Mexico blocks, 80 million acres, at a live-streamed event on Nov. 17.
It will be the first opportunity to test the oil and gas industry's demand for Gulf acreage with energy prices at multiyear highs. U.S. crude futures on Nov. 16 settled at $80.76 a barrel, up 95% in the last 12 months.
The Trump administration's final Gulf sale, held last November, generated a modest $121 million in high bids. But oil companies Royal Dutch Shell, BP and Chevron are seizing on the higher prices to advance offshore projects.
Despite the court-ordered resumption of auctions, Interior spokesperson Melissa Schwartz said the agency was "conducting a more comprehensive analysis of greenhouse gas impacts from potential oil and gas lease sales than ever before."
Environmentalists called for Biden to halt the sale via executive order. "Biden has the authority to stop this, but instead he’s casting his lot in with the fossil fuel industry," said Kristen Monsell, senior attorney for the Center for Biological Diversity.
Ocean conservation group Oceana said the administration should "explore every opportunity to uphold the president’s commitment to protecting our communities, our climate, and our economy from the threat of drilling."
Recommended Reading
Exclusive: ‘Reality Has Hit,’ NatGas Not Just a Bridge Fuel, Landrieu Says
2024-04-11 - The Biden administration's LNG pause is "disappointing" and natural gas is a "solution to energy woes," co-chairs for Natural Allies for a Clean Energy Future Senator Mary Landrieu and Congressman Kendrick Meek told Hart Energy's Jordan Blum at CERAWeek by S&P Global.
Belcher: Our Leaders Should Embrace, Not Vilify, Certified Natural Gas
2024-03-18 - Recognition gained through gas certification verified by third-party auditors has led natural gas producers and midstream companies to voluntarily comply and often exceed compliance with regulatory requirements, including the EPA methane rule.
Hirs: LNG Plan is a Global Fail
2024-03-13 - Only by expanding U.S. LNG output can we provide the certainty that customers require to build new gas power plants, says Ed Hirs.
Pitts: Producers Ponder Ramifications of Biden’s LNG Strategy
2024-03-13 - While existing offtake agreements have been spared by the Biden administration's LNG permitting pause, the ramifications fall on supplying the Asian market post-2030, many analysts argue.
Wanted: National Gas Strategy for Utilities, LNG
2024-02-07 - Chesapeake CEO Nick Dell’Osso and Mercator Energy President John Harpole, speaking at NAPE, said some government decision-makers have yet to catch on to changes spreading across the natural gas market.