The Biden administration is canceling planned drilling rights auctions in the Gulf of Mexico and Alaska’s Cook Inlet, raising doubts about the US government’s offshore oil leasing program’s future.
The Interior Department said in an emailed statement that two Gulf lease auctions planned under former President Barack Obama “will not move ahead” owing to “delays due to circumstances such as contradictory court orders that impacted work on these intended sales.”
A separate sale of tracts in Alaska’s Cook Inlet, which had been planned for last year, has been canceled “due to a lack of industry interest in leasing the area,” according to the government.
The decisions come as fuel prices are rising and oil supplies are running low, prompting Biden administration officials to plead with energy corporations to increase production. Oil industry officials say auctions are critical to replenish reserves and offset natural declines from existing wells in the Gulf of Mexico, despite the fact that new offshore leases can take years to come online.
The Interior Department has not said when it would sell drilling rights in US coastal waters again, nor has it completed the five-year plan required to stage those auctions after July 1.
Interior Secretary Deb Haaland told lawmakers two weeks ago that a “substantial amount of internal work” remains on the five-year plan, indicating that it is unlikely to be in place when the present program expires on June 30. Furthermore, according to federal budget papers, the Biden administration does not plan to sell any more Gulf of Mexico oil and gas leases until at least October 2023.
On the campaign trail, President Joe Biden promised to stop “new oil and gas licensing on public lands and waters,” and once in office, he froze lease sales to allow Interior Department authorities to examine their environmental consequences.
Last year, a federal judge in Louisiana ordered the Interior Department to resume sales, and the case is now being reviewed by a federal appeals court in New Orleans. Separately, a federal district judge in Washington, D.C., blocked the administration’s November sale of leases in the Gulf of Mexico spanning 1.7 million acres (688,000 hectares) after determining the agency had miscalculated the climate impacts.
As countries wean themselves off Russian oil and gas, Republicans and a few moderate Democrats have urged the administration to speed up leasing. Democratic lawmakers Vicente Gonzalez, Sylvia Garcia, Henry Cuellar, and Lizzie Fletcher wrote to Biden last week, urging him to release a new five-year plan for selling leases offshore more regularly to “help bring millions of extra barrels of US oil to market.”