By Timothy Gardner and Nichola Groom
WASHINGTON (Reuters) – The U.S. will hold an oil and gas lease sale in the Gulf of Mexico, as planned by the administration of former President Joe Biden, and will release a proposed notice of it in June, the Interior Department said on Friday.
The auction of drilling rights would be the first under a five-year leasing plan finalized by the Biden administration in 2023. That program planned for just three Gulf lease sales during the period, a historically low number that angered the oil and gas industry and drilling states.
It is uncertain how eager energy companies will be to purchase leases in the Gulf, which the administration of President Donald Trump has renamed the Gulf of America, as they weigh sliding oil prices with the infrequency of sales.
Oil prices sank on Friday to about $65 a barrel, the lowest levels since the middle of the pandemic in 2021, after China said it would impose additional tariffs, in response to Trump’s tariff hikes. [O/R]
“Unlike under President Biden, we will not leave our critical energy resources locked up when so many Americans are suffering through the unnecessarily high cost of living imposed by the previous administration,” Secretary of the Interior Doug Burgum said.
The last Gulf of Mexico oil and gas lease sale in late 2023 raised $382 million, the highest since 2015.
Burgum, who is head of Trump’s energy dominance council, said that unleashing U.S. energy will lower gasoline and grocery store prices while boosting national security.
Trump removed the U.S. from the Paris Agreement on climate change and aims to slash regulations on planet-warming emissions from oil, gas and coal operations, in stark contrast to Biden, who moved to take vast areas of offshore drilling off the table.
The Biden plan also called for sales in 2027 and 2029.
Gulf lease sales have been stymied by litigation in recent years over the impact of drilling on an endangered animal called Rice’s whale. A federal judge in March ruled that the Interior Department had failed to adequately analyze a 2023 sale’s impacts on the whale and greenhouse gas emissions, putting the status of hundreds of leases in doubt.
(Reporting by Timothy Gardner in Washington and Nichola Groom in Los Angeles; Editing by Matthew Lewis)
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