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Gulf lawmakers sound alarm over delayed offshore drilling plan

A moratorium imposed last year and a delayed five-year oil and gas leasing proposal do nothing to relieve soaring gas prices or ensure revenue for state environmental programs, conservative lawmakers argue.

(CN) — Republican lawmakers along the Gulf Coast are expressing frustration with the Biden administration’s proposed five-year offshore oil and gas leasing program, which opened for a 90-day public comment period July 1 after the previous five-year program expired June 30.  

The renewal of the National Outer Continental Shelf Oil and Gas Leasing Program comes at a politically tumultuous time for oil and gas prices, which have soared to record highs in recent months, contributing to rising inflation and increasing demands for President Joe Biden to do more to increase the domestic supply. Biden placed a moratorium on the Trump administration’s lease plan shortly after taking office in 2021, and the new proposed plan will likely not be finalized until 2023.   

While the new plan offers as many 11 new leases — 10 in the Gulf of Mexico and one in Alaska’s Cook Inlet — it may also offer zero, depending on information gathered during the comment period. During his presidential campaign, Biden pledged to end new drilling on federal lands and waters, and U.S. Interior Secretary Deb Haaland made clear in announcing the public comment period July 1 that the administration is still hoping to influence an industrial shift away from fossil fuels, even as gas prices are soaring.  

“A proposed program is not a decision to issue specific leases or to authorize any drilling or development,” Haaland said in a statement. “From day one, President Biden and I have made clear our commitment to transition to a clean energy economy. Today, we put forward an opportunity for the American people to consider and provide input on the future of offshore oil and gas leasing. The time for the public to weigh in on our future is now." 

According to Haaland, the proposal was drafted in accordance with Section 18 of the Outer Continental Shelf Lands Act and considers such aspects as geography, geology, ecology, equitable sharing of benefits and environmental risks, and the “relative needs of national and regional energy markets,” among other things.

The most recent proposal is a marked reduction from a proposed 47-lease sale offered by the Trump administration in 2018, but critics are also concerned Biden’s moratorium, coupled with the delayed timeline of the new proposal, will lead to a two-year gap without a successful offshore lease sale for the first time since the 1960s. 

“This plan was an opportunity to unleash American production offshore and begin to reclaim our energy dominance so we can lower gas prices,” House Republican Whip Steve Scalise, R-La., offered in a statement last week. “Instead, President Biden continues to limit American energy production while at the same time begging foreign countries like Russia and Saudi Arabia to produce oil for us.” 

Congressman Jerry Carl, R-Ala., also expressed resentment of the plan, but hinted at another motivating factor for his opposition.  

“The idea of zero lease sales is unprecedented,” Carl said. “This decision endangers our national security, increases fuel costs, and strips south Alabama of critical funding for projects like coastline restoration and hurricane prevention.” 

Indeed, Alabama receives 37.5% of revenues from offshore oil and gas sales through the Gulf of Mexico Energy Security Act, or GOMESA. The revenue-sharing agreement also benefits Mississippi, Louisiana and Texas, and altogether those four coastal states split some $252 million in GOMESA revenues in fiscal year 2022, according to the Department of Interior. GOMESA money is intended to be used for coastal conservation, restoration and hurricane protection. In Alabama, it's been used to build public beach accesses and boat ramps, improve coastal parks, conduct environmental research and purchase land for conservation. 

Congressman Steven Palazzo, R-Miss., a former oil rig worker, said the proposal indicates Biden is uncommitted to energy independence and it also puts GOMESA funding “in great jeopardy.”  

“We need to preserve our coast, unleash American energy, and use every tool in our arsenal to protect our national security through our energy,” he said. 

In the wake of Biden’s moratorium last year, Carl introduced the Gulf Conservation and Recreation Funding Act, which would require the Department of Interior to pay GOMESA states the revenues they are missing out on during the gap between leasing programs. It was referred to the House Subcommittee on Energy and Mineral Resources, where it has since stalled. 

At the time, Congressman Randy Weber, R-Texas, said the moratorium threatened “a significant source of livelihood” for his constituents, as well as its GOMESA revenues. Last week, Weber wrote a tweet calling on the Biden administration to open the nation’s strategic petroleum reserve and “unleash domestic production now.” 

Behind Texas, the Gulf of Mexico is the nation’s second most prolific source of crude oil, producing some 1.7 million barrels per day in 2021, according to the U.S. Energy Information Administration.

Todd Staples, president of the Texas Oil & Gas Association, said the industry struggles with inconsistent federal policy.   

“Consumers suffer when energy policy doesn’t recognize and promote the long-term development of oil and natural gas, indispensable commodities that are literally essential to modern life,” Staples said. “Oil and natural gas are leading the way toward continued environmental progress and the federal offshore leasing program, like most of domestic energy policy today, needs to provide certainty and consistent opportunities for production, pipelines and processing of these products that every American depends upon.” 

The public comment period ends on Oct. 6. Comments are accepted on the Bureau of Ocean Energy Management’s website

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