Oil & Gas News

Biden’s 5-Year Offshore Oil Plan to Have Historically Few Lease Sales

Biden, Oil

By: Reuters – The Biden administration’s five-year plan for offshore oil and gas leasing will not include any sales in 2024 and will feature just three in the final four years, the lowest number of auctions in the history of the program, according to three sources familiar with the matter.

The plan is almost certain to disappoint both environmental groups and oil companies. In recent years, politicians, environmentalists, and the oil industry have cast the national leasing program as a symbol of either the need to rein in fossil fuel development to avert the worst impacts of climate change or as a critical tool to shore up domestic energy supplies and keep pump prices low.

Mineral Rights

Since 1992, no five-year plan has had fewer than 11 lease sales and most have had 15 to 20, according to data from the Bureau of Ocean Energy Management.

The schedule for leasing in the Gulf of Mexico and Alaska for 2024-2028 is due on Friday following several delays and months of battling between environmentalists and drilling advocates over what the policy should look like.

The final plan will mark a dramatic reduction from a proposal the Trump administration had crafted in 2018 that envisioned 47 lease sales, including in California and the Atlantic.

It will, however, fall short of U.S. President Joe Biden’s campaign promise to end new federal drilling entirely to fight climate change, after court decisions required continued leasing and last year’s Inflation Reduction Act made them a pre-requisite for new offshore wind power lease auctions.

The White House is expected to argue on Friday that holding oil lease sales is the price to pay if it wants to achieve its ambitious wind energy goals.

“The administration heard from the offshore wind industry that they need the IRA leasing mandates to be fulfilled to enable the U.S. offshore wind energy to continue to grow,” a source familiar with the plan told Reuters.

Biden sees offshore wind power as a key tool in his administration’s effort to decarbonize the economy.

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“The number of oil and gas lease sales will be the lowest in history and will enable the rapid expansion of the offshore wind industry,” the source said.

The Interior Department is required by law to create a national oil and gas leasing schedule every five years. It has been without one since the previous one expired in June 2022 due to heated debate over the program.

The Biden administration unveiled a proposed plan in July last year that had contemplated between zero to 11 lease sales.

The plan will be subject to a 60-day waiting period before it can be approved by Interior Secretary Deb Haaland.

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