US Judge Cancels Oil Lease Auction in the Gulf of Mexico

According to the Biden administration, the findings of an oil and gas lease auction in the Gulf of Mexico were rejected on Thursday by a federal court in the United States.

The court found the auction had not been properly accounted for in climate change effects.

Due to the decision, there is presently ambiguity about the future of the United States government’s offshore drilling operations.

Drilling, for decades, has generated significant revenue for the government.

It is also drawing the ire of environmental activists involved in the program’s influence on the ecosystem and its impact on climate change.

Outdated Environmental Analysis

Per the Energy Information Administration, the Gulf of Mexico contributes 15 percent of present oil and gas production and five percent of dry natural gas production in the United States.

In bidding last November, lease Sale 257 offered approximately 80 million subsea acres (37.4 million hectares) in the Gulf of Mexico.

Still, it was subsequently canceled by Judge Rudolph Contreras of the United States District Court for the District of Columbia, who ruled the sale should be annulled.

On 1.7 million acres sold, the auction produced more than $190 million, the biggest amount generated since 2019.

It drew bids from major oil companies in the United States, including ExxonMobil and Chevron.

The buyout was contested on behalf of four other environmental organizations by the environmentalist Earth Justice.

They argued the Interior Department depended on an outdated environmental assessment that did not accurately account for greenhouse emissions resulting from the blocks’ advancement.

The sale was finally approved on Thursday after the environmental organization Earth Justice won its appeal.

In his response, Mr. Contreras blasted the administration for removing foreign demand from its greenhouse gas emissions study and failing to consider the most recent scientific findings of oil and gas production on climate change.

Failed Promises

Biden ran for president, partly on a promise to prohibit federal oil and gas drilling to combat climate change.

However, efforts to suspend fresh auctions were unsuccessful after Gulf Coast states filed a lawsuit against the administration.

To facilitate oil and gas production, Congress has mandated the United States conduct periodic auctions of public lands.

Brettny Hardy, a senior attorney with Earth Justice, stated, “We are thrilled the court upheld the unconstitutional lease transaction by the Department of Interior.”

“We can’t carry on making investments in the fossil energy business at the expense of our communities and a world that is rapidly warming.”

The decision was met with disapproval by the offshore drilling sector.

“Uncertainty about the future of the federal offshore leasing program may only serve to reinforce the global power of higher emitting countries, such as Russia,” said Erik Milito, president of the National Ocean Industries Association, in response to the ruling.