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
Exxon Versus Chevron: The Fight for Hess’ 30% Guyana Interest
2024-03-04 - Chevron's plan to buy Hess Corp. and assume a 30% foothold in Guyana has been complicated by Exxon Mobil and CNOOC's claims that they have the right of first refusal for the interest.
Petrobras to Step Up Exploration with $7.5B in Capex, CEO Says
2024-03-26 - Petrobras CEO Jean Paul Prates said the company is considering exploration opportunities from the Equatorial margin of South America to West Africa.
The OGInterview: How do Woodside's Growth Projects Fit into its Portfolio?
2024-04-01 - Woodside Energy CEO Meg O'Neill discusses the company's current growth projects across the globe and the impact they will have on the company's future with Hart Energy's Pietro Pitts.
NAPE: Turning Orphan Wells From a Hot Mess Into a Hot Opportunity
2024-02-09 - Certain orphaned wells across the U.S. could be plugged to earn carbon credits.
Deepwater Roundup 2024: Offshore Australasia, Surrounding Areas
2024-04-09 - Projects in Australia and Asia are progressing in part two of Hart Energy's 2024 Deepwater Roundup. Deepwater projects in Vietnam and Australia look to yield high reserves, while a project offshore Malaysia looks to will be developed by an solar panel powered FPSO.