Biden Administration Temporarily Suspends New Fossil Fuel Leases

Jan 21, 2021

Map of final parcels sold in BLM's Q4 lease sale
Credit Bureau of Land Management

The Biden Administration has handed down a sweeping order that temporarily suspends several agency actions including the issuing of federal fossil fuel leases for the next 60 days, unless otherwise reviewed and approved by leadership.

"This order ensures that the Department continues its existing operations including operations necessary for health, safety, and national security matters-consistent with all legal obligations and policy goals," read the Jan. 20 order signed by Scott de la Vega, acting Secretary of the Interior.

The Interior Department, more specifically, is suspending the issuing of any onshore or offshore fossil fuel leases, amendments or extensions to a lease or permits to drill.

The decision has been lambasted by Wyoming leadership and oil and gas interests, who have warned of legal action in anticipation of a similar move.

U.S. Sens. John Barrasso and Cynthia Lummis both criticized the action in statements. Barrasso called it not just ill-advised, but illegal. He argued the federal government cannot override law with staff memos.

Keith Hall, director of the Energy Law Center at Louisiana State University, said legal action could be in play, particularly if the suspension goes on past 60 days.

"[It] might be subject to a strong legal challenge because companies have paid an upfront fee to acquire the leases, and a ban on drilling essentially stops the companies from using the leases, except for continuing to produce from any wells that already have been drilled," he said. Hall said the 60 days alone would likely not be a big deal.

The Petroleum Association of Wyoming echoed that it would work to protect Wyoming livelihoods using "all legal means at our disposal."

Gov. Mark Gordon called the order punitive and contrary to Biden's pledge of unifying the nation, in a statement. He said it will delay Wyoming's ability to expand its economy.

"All Wyoming people should be concerned about this action because the revenue from development on public lands drives the funding for schools, healthcare and other key services," he said in a statement.

Environmental groups, on the other hand, were pleased with the decision.

Shiloh Hernandez, attorney with the Western Environmental Law Center, said this is clearly a step towards the Biden Administration's broader effort towards overarching policy regarding fossil fuel development.

"It seems to be a reasonable start. Of course, in order for the Biden Administration to fulfill its pledges to really tackle climate change, and start moving forward with some climate solutions, there's going to have to be a lot more to be done," he said. "But Rome wasn't built in a day."

Wyoming's rig count has fallen dramatically since last year, currently sitting at four. In February, 2020, Wyoming had 23 rigs within its boundaries and even more the previous summer.

Lease sales in Wyoming have consistently faced protests from conservation groups for reasons including selling parcels on sensitive habitat including that of sage grouse.

Groups also argue taxpayers aren't getting a fair return on energy leases with the acres selling for increasingly less money. The Casper Star-Tribune highlighted that 2020 lease sales brought in 92 percent less revenue than the previous year.

Wyoming's next lease sale is set for March. While there's no explicit schedule change on the Bureau of Land Management's website, it will likely be vetted by appointees of the new administration and could face a delay, according to Hernandez.