October 29, 2023

Appeals panel issues stay on Biden administration's oil lease sale deadline

In the latest twist in an ongoing legal saga, a federal appeals panel this week issued a stay of a prior court order requiring the Biden administration to follow through with a Gulf of Mexico oil lease sale, which was set to take place in November, as The Hill reports.

Despite the ruling, however, there remains uncertainty as to whether the administration will go ahead and hold the lease sale, provisions for which were included in last year's Inflation Reduction Act.

Background of controversy

According to the text of the aforementioned legislation, the Interior Department was mandated to hold a lease sale in the Gulf of Mexico.

However, earlier this year, the administration declared its intention to reduce the available leasing area by roughly 6 million acres, claiming that to do otherwise would pose an unacceptable risk to the habitat of the Rice's whale, an endangered species.

Energy companies that were planning to take part in the lease sale challenged the move in court, causing a federal judge to block the administration's limitations on the scope of the sale and to order the process to move forward as originally planned, but with a deadline of Nov. 8 rather than Sept. 27.

Appeals court steps in

Last week, however, the Fifth Circuit Court of Appeals issued a stay of the aforementioned order pending a ruling on an appeal initiated by a number of conservation organizations.

As things now stand, oral arguments in that appeal are not slated to occur until Nov. 13.

With that date falling after the prior deadline for the lease sale, it remains to be seen whether the federal government will move forward with a sale of the full complement of acreage, hold a smaller-scale lease sale, or wait for a decision on the appeal.

Lawmakers weigh in

As U.S. News & World Report reveals, there is no shortage of opinions on Capitol Hill as to how the Interior Department should handle the situation, with Sen. John Barrasso (R-WY) declaring that the sale should go forward on Nov. 8.

“There is no reason to consider more last-minute changes and unnecessary delays,” Barrasso said on Friday.

Senate Energy Committee Chairman Joe Manchin (D-WV) characterized the back-and-forth within the administration regarding the sale as “a complete mess.”

Manchin also opined that the sale should take place regardless of external considerations such as the safeguards for the endangered whale species, but whether that is what actually happens in something that remains to be seen.

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