Government resumes sale of oil and gas leases on federal land

Joe Biden is backing down on a key promise of his program. Shortly after arriving at the White House in January 2021, the American President, who has made the fight against climate change one of his priorities, declared a moratorium on the awarding of new oil and gas drilling concessions on state-owned land and waters, pending review.

The Interior Department said in a statement Friday (April 15) that it will auction about 173 lots covering 144,000 acres (58,275 hectares) in nine states starting next week.

However, some changes will be made. The proposed area is now 80% smaller than originally planned. Most notably, the ministry will increase required royalties, which have not changed for at least a century, from 12.5% ​​to 18.75% of profits. Interested companies must finally adhere to new conditions, such as consultation with Indian tribes or respect “best available scientific methods” in particular for the analysis of greenhouse gas emissions.

Also read: Oil: With crude oil soaring, Washington will draw on its strategic reserves like never before

Popularity at half mast

This move comes at a time when the US President is facing record inflation, particularly in the price of gas, which is eroding his popularity. For several weeks he has been taking initiatives to lower the price of crude oil and, for example, at the end of March ordered massive amounts to be drawn from the country’s strategic oil reserves.

However, the resumption of lease sales for oil and gas production on federal land is not expected to have an immediate impact as the process typically takes several years.

The moratorium proclaimed by Joe Biden was already in full swing, and a judge suspended it in June 2021 as the administration needed to seek congressional approval. A few weeks later, the government launched the auction of sea concessions in the Gulf of Mexico, which was canceled by the judiciary in January. The Home Office also approved thousands of state oil and gas permits in 2021.

also read Article reserved for our subscribers War in Ukraine: Joe Biden bans imports of Russian oil

The world with AFP

Leave a Comment