Gulf oil leases have been a contentious topic but the Inflation Reduction Act said they are on.
As outlined by the Inflation Reduction Act, the Biden administration on Wednesday acknowledged it is recognizing the results of a Gulf of Mexico oil and gas lease sale from 2021 that a federal judge had rendered inert. The Bureau of Ocean Energy Management, which oversees the federal government’s offshore leasing program, said in a statement that it has accepted 307 bids totaling more than $189 million from the sale. Originally, the sale produced about $191.6 million in bids for 1.7 million acres in the Gulf of Mexico, but BOEM said one bid was rejected for failing to meet market value. The lease sales allow oil and gas extraction companies to bid for drilling space in federal offshore waters, including the Gulf of Mexico. Revenue from the leases is directed to the federal government and certain Gulf Coast states, including Louisiana, through the Gulf of Mexico Energy Security Act, or GOMESA.nola.com
How could this be? This is supposed to be a climate bill.
The revival of the results is part of a compromise struck by U.S. Sen. Joe Manchin, D-West Virginia, and Senate Majority Leader Chuck Schumer, D-New York, to push the Inflation Reduction Act across the finish line. Though the wide-ranging law includes investments to fight climate change, it also allows for offshore drilling, to the delight of oil and gas advocates and the chagrin of environmental justice groups. In addition to restoring the nixed sale, the Inflation Reduction Act calls for BOEM to hold one lease sale in the Gulf of Mexico by March and another by September 2023. The agency will also auction off space in Alaska’s Cook Inlet by December. Specific dates for those sales have not been scheduled yet. Back in May, BOEM canceled the two Gulf sales, citing conflicting court rulings on the legality of the sales. The agency said the Cook Inlet sale was nixed because of a lack of interest.
This issue have been in [play for over a year and has be a yes, no, yes, no topic.
The battle over offshore drilling traces back to January 2021, when President Joe Biden issued an executive order pausing lease sales on federal lands and in federal waters. That led to a lawsuit from Republican attorneys general, including Louisiana’s Jeff Landry, who won an injunction from U.S. District Judge Terry Doughty in Louisiana and paved the way for the November 2021 lease sale. However, U.S. District Judge Rudolph Contreras in Washington threw out the results of the sale, saying the federal government didn’t properly account for the sale’s environmental impacts. A federal appeals court in August sent the case back to Doughty for further clarification. Doughty, two days after Biden signed the Inflation Reduction Act, issued an injunction preventing the federal government from pausing any future lease sales in the states that had filed suit, including Louisiana. In its statement Wednesday, BOEM said the leases from the revived November sale include “stipulations to protect biologically sensitive resources, mitigate potential adverse effects on protected species, and avoid potential ocean user conflicts.”
This is not the end of the story as there is still work to cancel them, again.
The fight over future drilling in offshore waters is far from over. The Department of the Interior is still going through a public comment period for its proposed five-year leasing plan, which could include anywhere from no future lease sales to 11. Oil and gas advocates have called for more certainty on sales, while environmental justice groups lambasted the plan for having any sales at all. The department on Monday also issued proposed regulation changes for blowout preventers, the devices that seal wells in an emergency to prevent uncontrolled releases of crude oil and gas.
We need more renewables so that the drilling is not needed.