Biden’s ban of oil and gas sales on federal lands to be studied

Utah is among the western states where oil and gas sales on federally owned land have been banned pending government study. Photo: Zbynek Burival

BILLINGS, Mont. (AP) — The Biden administration said Tuesday that it will deliver an interim report on its suspension of oil and gas sales from federal lands and waters by summer, but officials declined to state how long the moratorium could remain in place.

Last month, the administration postponed lease sales in the Gulf and four states — Colorado, Montana, Utah and Wyoming.

Tuesday’s announcement offered the first details of a review of the Interior Department program that officials said will examine climate issues and whether taxpayers are getting a fair return on sales of energy leases to private companies.

Even a short-lived suspension on leasing will quickly affect companies, tying their hands as they seek to make drilling plans for coming years, said Erik Milito of the National Ocean Industries Association, which represents oil companies operating offshore.

“We will begin seeing companies starting to make decisions that will shift investments and jobs out of the U.S..” Milito said. The longer a suspension goes, he added, the more susceptible the administration will be to legal challenge.

Democrats, environmentalists and left-leaning policy groups said the leasing program has remained unchanged for decades and needed to be reformed in the face of climate change.

A long-term ban on lease sales from the nation’s vast, publicly-owned oil and gas reserves to address climate change would fulfill a campaign pledge from Democratic President Joe Biden. The prospect has rankled Republicans and petroleum industry representatives, who have said that Biden is putting tens of thousands of jobs at risk as the economy reels from the pandemic.

Oil and gas from federal reserves in western states and the Gulf of Mexico make up about a quarter of U.S. production.

Lease sales to companies for drilling have been a frequent target of lawsuits from environmentalists who contend officials have ignored the oil and gas program’s climate impact.

“The federal oil and gas program is not serving the American public well,” Interior Department Principal Deputy Assistant Secretary Laura Daniel-Davis said in a statement. “It’s time to take a close look at how to best manage our nation’s natural resources with current and future generations in mind.”

The administration has pledged to spend billions to assist in the transition away from fossil fuels such as oil, gas and coal. Biden has said creating clean-energy jobs is a top priority.

There is no estimate on how long the review could take, agency spokeswoman Melissa Schwartz said.