Illustration - Gulf of Mexico platform; Source: Petrobras NOIA

NOIA: Biden’s leasing moratorium has ‘no shortage of negative consequences’

Negative reactions to U.S. President Biden’s executive order to halt new oil and natural gas leasing on public lands and offshore waters are still coming in as the National Ocean Industries Association (NOIA) was next in line to give its view on the matter.

Illustration - Gulf of Mexico platform; Source: Petrobras

To remind, U.S. President Joe Biden signed an executive order to halt new oil and gas leasing which the Department of the Interior (DOI) claims will also enable job creation and provide a path to align the management of U.S. public lands and waters with the country’s climate, conservation, and clean energy goals.

The order also directs the Department of the Interior to make a comprehensive review of the federal oil and gas program.

The targeted pause does not impact existing operations or permits for valid, existing leases, which are continuing to be reviewed and approved and also does not restrict energy activities on private or state lands or lands that the United States holds in trust or restricted status for Tribes or individual Indians.

This indefinite halt to oil and gas permitting in federal lands and waters came only days after President Biden temporarily halted leasing in the same areas.

Under the executive order, steps will be made to accelerate the development of renewable energy on public lands and waters, including setting a goal to double renewable energy production from offshore wind by 2030.

According to the White House, Biden’s plan will ensure the U.S. can meet its target of a carbon pollution-free power sector by 2035. That would put the United States on an irreversible path to a net-zero economy by 2050.

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Immediately after the executive order was signed and announced, the IAGC, IPAA, and the API slammed the decision to halt oil and gas leasing calling it “short-sighted”, “in reality a ban”, “obliteration of jobs”, and “a step backwards for the U.S. economy” amongst other things.

A response from the National Ocean Industries Association (NOIA) was to be expected as well. NOIA president Erik Milito said: “This decision is contrary to law and puts America on a path toward increased imports from foreign nations that have been characterized as pollution havens.

Any pause of American energy opportunities will do untold harm towards American economic, energy and environmental progress. Reducing American offshore oil and gas development means lost jobs, increased greenhouse gas emissions and less funding for outdoor parks and recreation activities for urban, underprivileged communities. There is no shortage of negative consequences from this leasing pause.

The Gulf of Mexico is an American strategic asset, driving hundreds of thousands of jobs and billions of dollars of investment across every U.S. state. Billions of dollars are generated for Federal, state and local governments. The Land & Water Conservation Fund, and the host of climate-mitigating and environmental justice programs it provides for, receives virtually its entire funding from offshore oil and gas revenues, including new lease bids.

This decision could also hamper long-term energy affordability. As Americans continue to rely upon all sources of energy for maintaining a high standard of living, reduced supplies can put upward pressure on prices.

While the executive order is framed as a step towards a climate solution, it pauses energy opportunities in a region that is already addressing climate and emissions goals. Gulf of Mexico production has a carbon intensity one-half of other producing regions and the deepwater has the lowest greenhouse gas emissions of any source of oil and gas production. The innovators that define America’s offshore energy industry are already contributing to the continued advancement of climate change solutions.

The DOI has a legal obligation to expeditiously develop America’s energy resources. Instead of fulfilling this obligation and capitalizing on an American environmental and emissions success story, this decision delivers an opportunity to China and Russia.

As China and Russia seize jobs and investment, their energy, which is produced without the same level of regulations and standards as the U.S., could very well win permanent geopolitical importance to the detriment of the climate and the environment”.