A federal district judge has issued a ruling against a Gulf lease sale conducted by the Biden administration in 2023, saying the Interior Department was in violation of the Environmental Policy Act by failing to take into account the auction’s impact on the climate and whale populations.
Bloomberg reported that Judge Amit Mehta had not proposed any corrective action, leaving open the question of what the agencies responsible for the lease sale should do next. Per the report, options include invalidating the leases that were sold or revising the contracts in line with the findings.
A total of 26 companies bid for the blocks on offer, with 325 bids submitted for deposits covering 1.7 million acres. In addition to the big players, smaller producers also took part in the tender, teaming up to bid collectively.
The total acreage offered in the auction that took place in December 2023 was 9% smaller than original lease area specifically to protect the habitat of an endangered whale species, at 67 million acres instead of 73.4 million acres.
Following this, the American Petroleum Institute, U.S. supermajor Chevron, and the state of Louisiana sued the Biden administration, with API Senior Vice President and General Counsel Ryan Meyers saying the reduced acreage represented “unjustified actions to further restrict American energy access in the Gulf of Mexico.”
Judge Mehta, however, said that the Bureau of Ocean Energy Management had made “a glaring omission” in only assessing the impact of the lease sale on Rice’s whale core habitat when there was “credible evidence” that this habitat spanned beyond that core area.
Also, the judge argued that the BOEM had not considered in full the effects of new oil and gas development in the Gulf on carbon dioxide emissions and the impact of energy market changes on these emissions. The case was brought to court by half a dozen environmentalist organizations.
By Irina Slav for Oilprice.com
