New York

US auctions Gulf of Mexico oil under climate compromise

NEW ORLEANS (AP) — The Biden administration on Wednesday will auction more than 114,000 square miles (295,000 sq km) of oil and gas leases in the Gulf of Mexico in a sale mandated by last year’s climate-legal compromise.

The online auction, which is expected to attract the interest of major oil companies such as ExxonMobil and Chevron, is the first in more than a year to endorse President Joe Biden in 2020 but is unhappy with this month’s bid. It could further test the loyalty of established environmentalists and young voters. Approval of the large-scale Willow drilling project in northern Alaska.

Developing leases for sale in the public waters of the Gulf of Mexico could produce more than 1 billion barrels of oil and 4 trillion cubic feet (113 billion cubic meters) of natural gas over 50 years, according to government analysis. I have. Analysis reveals that burning that oil adds tens of millions of tons of carbon dioxide emissions to global warming.

Oil prices have fallen sharply over the past year, and it’s unclear how much companies will invest in new leases. is unknown and may hinder the company’s expansion plans.

Still, analyst Sami Yahya said the approval of the ConocoPhillips Willow project at the Alaska National Oil Reserve bodes well for the industry and future leasing prospects.

“It shows that the Biden administration is likely trying to balance the energy transition and energy security,” said S&P Global’s Yahya.

The Interior Department sale comes two days before the deadline set in last year’s climate bill signed by Biden. The bill prohibited leasing public land for renewable power unless tens of millions of acres of land were first made available for fossil fuels. This was a concession to gain support from fossil fuel industry supporters West Virginia Democrat Joe Manchin.

The submarine parcels auctioned on Wednesday cover an area larger than Arizona. Previous auctions of similar size have shown only a fraction of the available square footage.

Bidding from companies was due Tuesday and was scheduled to begin Wednesday at 9:00 am in New Orleans.

The sale is being made in a state that is economically dependent on the oil and gas industry, but is also particularly vulnerable to climate change.

Leasing could produce oil and gas well beyond 2030, as it takes years to develop offshore parcels before crude is pumped.

Sea-level rise is one of the drivers of the steady loss of coastal wetlands in Louisiana, home to a wide variety of fisheries and wildlife, as well as a buffer between inland population centers and hurricanes. It is Scientists say hurricanes are getting stronger as the world warms.

Louisiana’s complicated relationship with industry has been complicated by lawsuits filed by coastal parishes that have allegedly damaged wetlands for decades, from dredging canals to drilling for oil and gas. is also shown.

A lawsuit against Wednesday’s sale is pending in the US District Court in Louisiana. He has 90 days for the government to evaluate the bid. This means that bids may be blocked before they are issued.

“There has been a lot of talk from the administration about taking climate change seriously and moving the economy away from fossil fuels, but we continue to see large-scale oil and gas projects, both onshore in Willow and offshore in the Gulf of Mexico. Earthjustice attorney George Torgan, representing environmental groups in this case.

Chevron said in a court filing Monday that it could lose millions of dollars from future production if the lease is blocked. The company’s Gulf of Mexico operations have produced the equivalent of nearly 200,000 barrels per day from hundreds of leases purchased since 2001, representatives of the Houston-based company said in an affidavit. said in

“Chevron plans to produce from leases in the Gulf of Mexico over the next few decades,” said regional Chevron manager Trent Webre.

In the last Gulf of Mexico auction in 2021, companies offered a total of $192 million on land totaling approximately 2,700 square miles (6,993 square kilometers). The sale was subsequently blocked by a federal judge, but was reinstated under last year’s climate change bill.

Over the next few months, beginning in May, the administration will auction more than 500 square miles (1,400 square kilometers) of onshore oil and gas leases in Wyoming, New Mexico, Montana, Nevada and other states.


Brown reported from Billings, Montana.

Copyright © 2023 The Washington Times, LLC. US auctions Gulf of Mexico oil under climate compromise

Back to top button