Judge Tosses Out Offshore Oil Leases Signed By Biden Administration

Topline

A federal judge rescinded oil and gas leases for a wide swath of the Gulf of Mexico on Thursday, arguing the government failed to consider their impact on climate change before they were auctioned off late last year, a win for environmental groups that have pushed the Biden Administration to stop signing new leases.

Key Facts

D.C.-based Judge Rudolph Contreras’ ruling vacates a November 2021 oil and natural gas lease sale that covered 80.8 million acres off the Gulf Coast, which Contreras described as the largest offshore oil and gas lease in the country’s history.

In a 68-page ruling, Contreras said the Department of the Interior used a flawed method for weighing how drilling in the Gulf of Mexico could impact greenhouse gas emissions, not reasonably factoring in foreign demand for oil, thus violating federal environmental laws.

Hallie Templeton from Friends of the Earth — one of the environmental groups that sued the government — called the ruling a “victorious outcome not only for the Gulf’s communities, wildlife, and ecosystem, but also for the warming planet” in a statement.

The Interior Department is still reviewing the decision, a spokesperson told Forbes.

Key Background

Shortly after President Joe Biden entered office last year, he vowed to halt all new oil and gas leases on federal land, part of a broader push to slash carbon emissions. But a federal judge reversed that moratorium in June, arguing the Biden Administration didn’t have the authority to unilaterally stop signing new leases nationwide, and ordered that previously scheduled lease sales in the Gulf should go forward. Environmental groups have excoriated the Biden Administration for continuing to sign leases following the June decision, though the White House has argued it has no choice but to obey the court’s order.

Further Viewing

Big Number

14.6%. That’s the share of U.S. crude oil that was produced on offshore rigs in the Gulf of Mexico in 2020, according to the Department of Energy. Some 1.6 million barrels were produced per day in 2020, down 13% from 2019 but up 31% from seven years prior.