US to Hold Gulf of Mexico Oil Auction After Delays
Biden Administration to Hold Auction
The Biden administration is set to hold an auction of oil and gas leases in the Gulf of Mexico on Wednesday after facing several delays due to litigation over the drilling industry’s impact on an endangered species of whale.
Last Opportunity for Oil and Gas Companies
The sale will likely be the last opportunity for oil and gas companies to bid on Gulf of Mexico acreage until 2025, according to the administration’s five-year schedule, which includes a historically low number of planned lease auctions.
Expansion of Sale
The sale of more than 72.7 million acres on the Outer Continental Shelf includes 6 million acres that Interior Department officials had tried to withdraw months ago to protect the habitat of the Rice’s whale. A federal judge ordered that the sale be expanded after oil and gas companies sued.
Online Broadcast of Bids
The U.S. Bureau of Ocean Energy Management (BOEM) will open and announce bids on an online broadcast beginning at 9:00 a.m. in New Orleans (1500 GMT).
Pre-Sale Statistics
About 2.4% of the acreage offered received bids from a total of 20 companies, according to a document of pre-sale statistics posted on BOEM’s website. More than three-quarters of the tracts that received bids were in water more than 800 meters (2,625 feet) deep.
Biden Administration’s Climate Change Agenda
President Joe Biden has sought to limit new oil and gas leasing as part of his climate change agenda, but a new federal law made offshore wind leasing contingent on offering oil and gas drilling rights. The Biden administration sees offshore wind development as important to decarbonizing the U.S. power sector.
Global Climate Change Agreement
The sale comes days after the United States and nearly 200 other nations agreed to begin reducing consumption of fossil fuels to avert the worst impacts of climate change.
