Court order pushes US to expand Gulf of Mexico oil & gas lease sale with previously removed blocks

The U.S. Bureau of Ocean Energy Management (BOEM) is taking steps to comply with a court order regarding the incoming offshore oil and gas lease sale for acreage in the Gulf of Mexico (GOM), which is due to be held in a couple of days. 

In the wake of BOEM’s final notice to hold Lease Sale 261 for acreage in the Gulf of Mexico in September 2023, the American Petroleum Institute (API) filed a motion for preliminary injunction in the U.S. District Court Western District of Louisiana, seeking immediate action from the court ahead of the planned lease sale as more than 6 million acres were removed from it.

After a court order was issued on September 21, 2023, regarding Lease Sale 261, the United States is seeking an emergency stay of this order to allow time for a more orderly lease sale process. In the case such relief is not granted, Lease Sale 261 will be conducted on September 27, 2023, and in accordance with the court’s order, BOEM will include lease blocks that were previously excluded due to concerns regarding potential impacts to the Rice’s whale distribution in the Gulf of Mexico.

In addition, the Bureau of Ocean Energy Management will remove portions of a related stipulation meant to address potential impacts to Rice’s whale from the lease terms for the leases that may be issued as a result of Lease Sale 261. BOEM is also extending the bid submission period to 3 p.m. CST on September 26, 2023, and bidders may hand deliver bids from 9 a.m. to 3 p.m. CST on September 25 and 26, or send them via mail.

Commenting on the preliminary injunction granted by the U.S. District Court Western District of Louisiana ahead of the planned Lease Sale 261, Ryan Meyers, API’s Senior Vice President and General Counsel, remarked: “We are pleased that the court has hit the brakes on the Biden Administration’s ill-conceived effort to restrict American development of reliable, lower-carbon energy in the Gulf of Mexico.

“Today’s decision will allow Lease Sale 261 to move forward as directed by Congress in the Inflation Reduction Act, removing the unjustified restrictions on vessel traffic imposed by the Department of the Interior and restoring the more than 6 million acres to the sale. This decision is an important step toward greater certainty for American energy workers, a more robust Gulf Coast economy and a stronger future for U.S. energy security.” 

As the previous five-year offshore leasing program expired with no new plan in place, multiple energy trade groups urged the Biden administration several weeks ago in a letter sent to President Joe Biden, to finalize a program that includes the maximum number of lease sales and begin the pre-leasing work required to start holding sales in 2024.

This was followed by comments submitted to the Department of the Interior’s Bureau of Land Management (BLM) on Friday, September 22, 2023, when the American Petroleum Institute joined with 13 energy trade associations in calling on the Biden administration to prioritize the energy needs of the American people by developing “fair and consistent” federal leasing regulations.

Holly Hopkins, API Vice President of Upstream Policy, stated: “Our nation and the world will continue to need reliable, affordable oil and natural gas to grow our economy, power our communities and serve as the foundation for broader opportunities for decades to come. Oil and natural gas production on public lands is a crucial part of the nation’s program for energy security and economic strength. Because of the vital importance of energy production on public lands, overreaching land management regulations place our domestic energy supply at risk.” 

Moreover, the associations raised concerns that the proposed rule overreaches BLM’s statutory authority, disregards Congress’s intent to preserve federal leasing programs, and rejects existing robust planning and environmental review processes, allowing BLM to constrain onshore energy development on a case-by-case basis.

The incoming 2024 presidential run in the U.S. is turning into a referendum of sorts on clean energy and net-zero aspirations, as most of the Democratic Party and their Republican counterparts have drawn a clear line on this issue. While Democrats’ stance indicates a further push for green energy, the majority of Republicans are seeking to bring forth more fossil fuels with very few – if any – clean energy initiatives included in their energy agendas.  This was confirmed within the new energy plan, presented by the governor of Florida and Republican presidential contender, Ron DeSantis.

If he wins the presidential elections in the U.S. next year, DeSantis will double down on fossil fuels production, limit federal regulations, slow the transition to electric vehicles (EVs) to a crawl, and overturn President Biden’s clean energy policies by, among other things, withdrawing from global agreements to reduce greenhouse gas (GHG) emissions, bringing America’s energy transition journey and net-zero agenda to a swift end. This outcome is also likely if any other Republican hopeful wins the elections next year, as the right-wing energy policies tend to be very similar on net-zero and climate change issues.

President Biden’s Bidenomics or economic agenda, targeting over a whopping $500 billion in private sector manufacturing and clean energy investments to fuel America’s energy transition story and green future, is an impressive undertaking that entails a goal of bringing 30 GW of offshore wind to life by 2030. However, these goals will not come to pass unless Biden – or someone who shares his energy views – is picked as the next U.S. president in 2024. During one of Offshore Energy’s previous interviews, the U.S. offshore wind sector was flagged for growth.

Most Democrats, like Biden and the current governor of California, Gavin Newsom, are dedicated to mitigating climate change by rolling out renewables and innovative low-carbon and emission reduction measures to ensure a more sustainable future in line with the Paris Agreement. The left-wing politicians tend to see fossil fuels as the primary driver of climate change, thus, they advocate the phaseout of traditional energy sources and the acceleration of net-zero measures.

Newsom hammered this home recently by supporting a lawsuit that was filed in San Francisco County Superior Court against five oil majors – ExxonMobil, Shell, Chevron, ConocoPhillips, and BP – and the American Petroleum Institute (API) for their alleged role in watering down the potential risks fossil fuels pose for climate and the environment while creating “statewide climate change-related harms in California.” The aim of this legal action is to hold Big Oil accountable for climate change.