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    US holds first offshore oil and gas lease under Biden

Summary

The White House said the lease went ahead while it appealed a court ruling against a moratorium on new drilling.

by: Daniel Graeber

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US holds first offshore oil and gas lease under Biden

The US government said November 17 it carried out a lease sale for oil and gas drilling rights in the Gulf of Mexico while it appeals a court decision to suspend its moratorium on new upstream activity on federal lands.

The Bureau of Ocean Energy Management (BOEM) put 308 tracts covering 1.7mn acres in the US territorial waters of the Gulf of Mexico on the auction block. The sale came despite an early-year pledge from US president Joe Biden to suspend new drilling and exploration on federal lands pending a comprehensive environmental review.

“Today’s sale was consistent with a US District Court’s preliminary injunction, while the government appeals the decision,” the BOEM said.

Biden has pursued a low-carbon energy policy. But ahead of the COP26 environmental summit in Glasgow, the president said it was not realistic to abandon fossil fuels overnight.

Erik Milito, the president of the National Ocean Industries Association, said the Gulf of Mexico is a “low-carbon energy basin.”

“Energy companies are increasingly making decisions that incorporate climate and ESG factors and want to produce oil from regions with a low carbon intensity,” he said.

The lease, however, did draw criticism from the environmental community. Diane Hoskins with the ocean advocacy group Oceana said continued lease sales were out of step with current efforts to address future climate emergencies.

“Getting serious about reducing emissions from fossil fuels must start with ending leasing for more offshore oil and gas development,” she said.

A total of 33 companies took part in the lease sale, offering nearly $200mn in total high bids. Federal data show oil production from the Gulf of Mexico averaged 1.5mn b/d in August, the last full month for which data are available. Natural gas production averaged 2bn ft3/d.