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Oil and gas leasing on U.S. federal lands will resume later this year, sources from the Biden administration have said, according to court documents cited by Reuters.
The White House said in January that it would review existing oil and gas leasing regulations to see if there was space for changes in them. While the review lasted, new oil and gas leasing would be suspended.
The news caused an immediate and negative reaction from states that draw in tens of millions in revenues from oil and gas production royalties. A group of such states earlier this year sued the administration, and in June, a Louisiana federal judge issued a preliminary injunction that effectively removed the ban.
The lawsuit argued that the ban would result in GDP losses of $33.5 billion during President Biden's first term and another $8.8 billion in conservation funding.
In July, Republican Senators accused the Department of the Interior of dragging its feet on restarting oil and gas leasing. Interior Secretary Deb Haaland responded by saying the department was evaluating its options. Earlier, following the court ruling, the department had said it would comply with it.
The administration responded by filing an appeal against the injunction with the Department of the Interior, saying, "The appeal of the preliminary injunction is important and necessary. Together, federal onshore and offshore oil and gas leasing programs are responsible for significant greenhouse gas emissions and growing climate and community impacts."
"Yet the current programs fail to adequately incorporate consideration of climate impacts into leasing decisions or reflect the social costs of greenhouse gas emissions including, for example, in royalty rates," the department also said earlier this month.
Now, according to a briefing seen by Reuters, the Interior Department plans to hold a lease sale in the Gulf of Mexico in October or November. Preparations for the tender should take until the end of this month.
Interior has "expended significant agency resources, including many hundreds of employee-hours, preparing to hold oil and gas lease sales," the department said in the brief.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com