UK Leasing

Biden administration cancels sale of oil and gas lease for Alaska drilling

The Biden administration canceled an oil and gas lease in Alaska as high gas prices pose political problems for the president.

The United States Department of the Interior’s decision halts the possibility of drilling for oil in more than a million acres of Cook Inlet in the south of the state.

The ministry said in a statement obtained by CBS News that a “lack of industry interest in leasing in the area” led to the decision to “not proceed” with the sale of the lease. The department also withdrew two proposed leases for the area around the Gulf of Mexico, citing “conflicting court rulings that have impacted work on these proposed lease sales.”

Federal law requires the department to adhere to a five-year lease plan for auctioning offshore leases. The current five-year plan was due to end at the end of this month and the department had until then to close the sales.

The White House had been silent on the sale of Alaska so far, but the end of the leases is in line with Mr Biden’s campaign promises to tackle the climate crisis.

But as gas prices rise, keeping those promises becomes politically difficult.

An anonymous conservationist said CBS News that “they don’t want to be affected by the Republicans given the high gas prices”.

“They get killed in attacks based on inflation. The most visible sign of inflation is the high price of gasoline,” the lawyer said.

This photo provided by BP shows the company’s Prudoe Bay oilfield facility in Prudoe Bay, Alaska

(Getty Pictures)

Part of the Trans Alaska Pipeline System is seen September 17, 2019 in Fairbanks, Alaska

(Getty Pictures)

A CBS reporter received a copy of an email in which White House National Climate Advisor Gina McCarthy said “Cook Inlet sale has been cancelled. He’s not moving forward.”

But another White House official was quick to respond that Ms McCarthy had spoken too soon and Home Office officials said a final decision had not been made. But the department then announced the move on Wednesday.

Frank Macchairola of the American Petroleum Institute, the largest oil and gas trade association in the United States, told CBS that the cancellation of the Alaska lease was “another example of the lack of administration to the development of oil and gas in the United States”.

“The president has spoken of the need for additional supplies in the market, but his administration has not taken action to match that rhetoric,” Macchairola said.

He added that it would not play “well” politically.

“In the type of price environment we see, there are negative consequences to stopping oil and gas development, both politically and practically,” he said.

According to AAA, the national average price for regular gasoline was $4.42 on Thursday — an all-time high.

Environmental groups hailed the Biden administration’s decision. The Alaska lease could have made more than a million acres available for drilling over a period of 40 years or more, leading to new pipelines and underwater platforms in an area considered environmentally sensitive.

Drew Caputo of environmental advocacy group Earthjustice said SCS that these leases could have been used for more than a decade before driving gas prices down.

“It’s good for the climate, which cannot support new oil and gas developments,” he said. “It’s good for Cook Inlet because offshore drilling is dangerous and disruptive. And it’s good for the people of Cook Inlet, including the natives, who cherish the cove in its natural state. So that’s a very good thing. »

According to a recent survey69% of participants disapproved of Mr Biden’s handling of inflation and 65% believed he “could do more” to lower gas prices.

Mr Macchiarola said: “Unfortunately, this is becoming a trend – the administration is talking about the need for increased supply and acting to restrict it. As geopolitical volatility and global energy prices continue to rise, we again urge the administration to end the uncertainty and act immediately on a new five-year federal offshore leasing program.”

“Scientists tell us that the time to switch from energy to fossil fuels is not years away,” Caputo said. “It’s today. We need to end offshore oil leasing.