Joe Biden is undoing a major platform promise. The American President, who has made the fight against climate change one of his priorities, shortly after arriving at the White House in January 2021, had declared a moratorium on the award of new oil and gas drilling concessions on land and state-owned waters, review pending.
The Interior Department said in a statement Friday (April 15) that it will auction about 173 lots covering 144,000 acres (58,275 hectares) in nine states starting next week.
However, some changes will be made. The proposed area is now 80% smaller than originally planned. Most notably, the ministry will increase required royalties, which have not changed for at least a century, from 12.5% to 18.75% of profits. Interested companies must finally adhere to new conditions, such as consultation with Indian tribes or respect “best available scientific methods” in particular for the analysis of greenhouse gas emissions.
Popularity at half mast
This move comes at a time when the US President is facing record inflation, particularly in the price of gas, which is eroding his popularity. For several weeks he has been taking initiatives to lower the price of crude oil, ordering, for example, heavy use of the country’s strategic oil reserves at the end of March.
However, the resumption of lease sales for oil and gas production on federal land is not expected to have an immediate impact as the process typically takes several years.
The moratorium proclaimed by Joe Biden was already in full swing, and a judge suspended it in June 2021 as the administration needed to seek congressional approval. A few weeks later, the government launched the auction of sea concessions in the Gulf of Mexico, which was canceled by the judiciary in January. The Home Office also approved thousands of state oil and gas permits in 2021.