Following a year of global energy market turmoil spurred by war and uncertainty, the ongoing battle over oil and gas leasing in the Gulf of Mexico is showing no signs of slowing down in 2023.
The nation’s largest oil and gas lobbying group, the American Petroleum Institute, once again pressed the Biden administration on Wednesday to generate a five-year oil and gas leasing program that ramps up Gulf production years into the future.
Meanwhile, a coalition of 300 grassroots organizations, including at least four Louisiana-based groups, have signed a letter urging the federal government to phase out oil and gas leasing altogether — a possibility under the Biden administration’s proposed five-year leasing plan, released last year. The letter was published by the Center for Biological Diversity.
President Joe Biden campaigned on the idea of no new oil and gas drilling in the U.S. Shortly after taking office in 2021, he paused new leasing on federal lands and in federal waters, leading to a drawn-out legal tussle that the oil and gas industry ultimately won.
Last year, the Department of the Interior canceled a pair of lease sales — federal auctions that allow extraction companies to bid for drilling space — set for the Gulf of Mexico. However, as painfully high prices for crude oil and natural gas roiled gasoline and utility markets, Congress passed the Inflation Reduction Act, which put both lease sales back on the schedule and revived a previously nullified lease sale from November 2021.
Amid the drama, Interior released a new five-year plan for oil and gas leasing that calls for anywhere from zero lease sales to 11, the vast majority of which would be in the Gulf of Mexico. Oil and gas advocates have called for more lease sales, while environmental justice groups have begged for the sales to fade away.
A public comment period for the five-year plan ended in October, but Interior is still reviewing submissions and has yet to provide a timeline for an updated plan.
Required by federal law, five-year leasing plans outline schedules for lease sales in federal spaces. Interior’s last lease sale, which offered up space in Alaska’s Cook Inlet, solicited one bid for nearly $64,000 in December.
As part of its latest strategic plan, released Wednesday, the API said the Interior department must approve a “robust” five-year leasing plan in an effort to boost fossil fuel production. API is also calling for a streamlined process to accelerate federal approval of liquefied natural gas export plants, which have proliferated along Louisiana’s Gulf coast.
Frank Macchiarola, API’s senior vice president of policy, economic and regulatory affairs, said halting Gulf of Mexico production would wreck industry employment and the nation’s gross domestic product.
Macchiarola said API hopes an Inflation Reduction Act provision that ties wind lease sales to oil and gas lease sales will push Interior to schedule more fossil fuel lease sales beyond 2023.
“It’s essential that they issue a five-year plan,” he said during a conference call with reporters. “We’re pushing the administration very hard to include as much leasing as possible in the five-year plan.”
Meanwhile, the grassroots coalition letter said the administration has “fallen short” of Biden’s promises to slow down drilling. It said Interior issued new drilling permits in 2021 at a rate faster than former President Donald Trump’s administration.
The letter calls on Interior to issue a five-year plan that excludes new lease sales, as well as eliminate oil and gas production on public lands and in public waters by 2035.
The letter is signed by at least four Louisiana-based organizations: the Greater New Orleans Climate Coalition, the Greater New Orleans Housing Alliance, New Orleans-based Healthy Gulf and The Descendants Project.
“The U.S. can be a climate leader, but not until we begin managing our public lands and waters in a manner consistent with climate science,” the letter said.