By Canadian Press

US officials: report on oil and gas sale ban due by summer

Mar 9, 2021 | 12:53 PM

BILLINGS, Mont. — 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.

A long-term ban on lease sales from the nation’s vast, publicly-owned oil and gas reserves to address climate change would fulfil 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.

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Biden announced a temporary suspension of new sales one week after he took office.

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.

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

“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.

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.

“The oil and gas leasing program is broken, plain and simple,” said Jenny Rowland with the Center for American Progress, a liberal, Washington-based policy group that has been supportive of Biden’s agenda.

The Interior Department said it will host a livestreamed forum on the leasing program on March 25 to get input from industry representatives, labour and environmental justice groups and natural resource advocates.

A report outlining initial findings and the next steps in the review will be completed by early summer, officials said.

Matthew Brown, The Associated Press