Interior cancels two GoM offshore lease sales and Cook Inlet sale

The Interior Department released word May 11 that it will not hold oil and gas lease sales 259 and 261 in the Gulf of Mexico “as a result of delays due to factors including conflicting court rulings.”

The unspecified court rulings “impacted work on these proposed lease sales,” said an Interior statement released to reporters.

The department also said it will not move forward with proposed oil and gas lease sale 258 in Cook Inlet, Alaska, “due to lack of industry interest.”

The three canceled sales were the last three on the list of sales scheduled as part of the 2017-2022 five-year leasing program, which ends June 30.

Given that lease sale 257 was vacated and remanded by a January court ruling (OGJ Online, Jan. 28, 2022), it appears likely that no more sales will be held before the end of the current program, and the next five-year program has not been taken through the necessary steps of a rulemaking.

‘Not surprising’

The government statement about conflicting court rulings did not sit well with the National Ocean Industries Association (NOIA).

“The administration absolutely has the ability to hold these lease sales,” said NOIA President Erik Milito in a statement released May 12. “They also have the ability to prepare a new leasing program for the 2022-2027 program.”

Milito suggested it was a strategy to carry out President Biden’s political wishes.

“This decision is not surprising at all,” he said. “As early as March 2020, then-candidate Biden made it clear that he would stop federal oil and gas development if elected. This was followed by additional formal campaign declarations, a pause on federal leasing that continues today, and continued statements by the administration that it is their intent to stop additional federal oil and gas development.”

The Biden administration has given no indication of when it will take the necessary steps for developing a new 5-year leasing program for offshore oil and gas, a program that is mandatory under the Outer Continental Shelf Lands Act.