Biden administration issues oil and natural gas leases to oil and gas companies after court invalidated sale

The Biden administration has issued oil and natural gas leases to companies that have nabbed the Gulf of Mexico drilling rights in a government auction that was later invalidated by a federal court.

The Interior Department s Bureau of Ocean Energy Management said it had accepted 307 winning bids from that November 2021 sale, dispelling lingering uncertainty about how the agency would comply with a mandate in the new climate law that required the lease awards.

President Joe Biden is trying to fight climate change while also combating record inflation as a result of high energy costs, and the move comes at a pivotal time for the White House. Top Biden administration officials have exhorted oil companies to produce more crude and refine more gasoline in a bid to lower fuel costs.

The bureau stressed that it was in compliance with the law, but also wanted to minimize environmental impacts of any drilling and oil production from the newly awarded leases.

The bureau said in an emailed statement that the leases resulting from this sale include stipulations to protect biologically sensitive resources, mitigate potential adverse effects on protected species and avoid potential ocean user conflicts.

Oil companies spent some $190 million on leases in the Gulf sale last November. A Washington-based federal district judge tossed out the auction just three months later, after finding that the Interior Department didn't adequately analyze the climate change impacts of the sale.

Under a provision tucked into the Inflation Reduction Act, the Interior Department was required to grant those leases. Future oil lease sales are required for the agency to issue rights of way and leases to renewable projects on federal lands and waters.

The Inflation Reduction Act will allow the Interior Department to play a leading role in the transition to a clean energy economy, the ocean energy bureau said. We are committed to implementing the law, including the federal oil and gas programs. None of the Google's Loon Project gets resurrected.