• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 8 hours Solving The Space Problem For America’s Solar Industry
  • 3 hours Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 10 hours How Far Have We Really Gotten With Alternative Energy
  • 2 days Investment in renewables tanking
  • 6 days If hydrogen is the answer, you're asking the wrong question
  • 6 days "Mexico Plans to Become an Export Hub With US-Drilled Natural Gas" - Bloomberg - (See image)

Biden Restarts Oil Leasing on Federal Lands

President Biden has decided to remove a moratorium on oil and gas drilling on federal lands in a U-turn from campaign promises to prioritize a shift away from fossil fuels.

According to a release by the Department of the Interior, this week will see some 144,000 acres put up for leasing, with the department noting this is a much smaller acreage than previously nominated—some 80 percent smaller.

In addition to that, the Department of the Interior will increase royalty rates for new leases to 18.75 percent and said that bidders would be held to stringent environmental standards.

“How we manage our public lands and waters says everything about what we value as a nation. For too long, the federal oil and gas leasing programs have prioritized the wants of extractive industries above local communities, the natural environment, the impact on our air and water, the needs of Tribal Nations, and, moreover, other uses of our shared public lands,” said Interior Secretary Deb Haaland.

“Today, we begin to reset how and what we consider to be the highest and best use of Americans’ resources for the benefit of all current and future generations.”

The move, however, would mean higher costs of developing the oil and gas resources on federal lands opened up to the industry at a time when costs are already climbing and acting as a deterrent despite strong oil prices.

According to Frank Macchiarola, senior VP at the American Petroleum Institute, the new lease terms could “discourage oil and natural gas investment on federal lands.”

“We are concerned that this action adds new barriers to increasing energy production, including removing some of the most significant parcels,” Macchiarola told the Financial Times.

It also goes against Biden’s energy agenda, which focused on curbing oil and gas drilling activity in favor of renewable energy.

Yet very much like the calls on the industry to boost production, the removal of the federal land drilling moratorium could be chalked up to a “Desperate times call for desperate measures” situation in U.S. energy.


By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News