![]() Companies may have secured more onshore and offshore permits in recent lease sales in anticipation of a policy change by the Biden administration. With more than 26 million onshore acres and 12 million offshore acres already under lease, there is a deep inventory of exploration opportunities. But since companies with existing leases will not be affected, the near-term impact on exploration and production as well as royalties to states will be limited. oil and gas production?Ī2: Federal land accounts for about 24 percent of oil and gas production in the United States, mainly in the offshore Gulf of Mexico. Last, Biden has directed government agencies to work toward eliminating fossil fuel subsidies by fiscal year 2022. Biden’s January 20 executive order also withdrew the permit for the Keystone XL pipeline and directed agencies to consider new rules to curb methane emissions from oil and gas. These moves follow executive orders that halted implementation of a leasing program in the Arctic National Wildlife Refuge and effectively suspended new leases, contracts, or drilling permits for at least 60 days. Biden ordered the Department of the Interior to take steps toward conserving 30 percent of public lands and waters by 2030 and toward doubling offshore wind production in the same timeframe. Biden has also directed the secretary of the interior to consider whether to adjust coal, oil, and gas royalties in order to account for corresponding climate costs, suggesting the possibility of a royalty increase. The Department of the Interior states that Native American tribal lands will be exempted. The Biden administration is halting new oil and gas leasing on federal onshore lands and offshore waters “to the extent consistent with applicable law.” This pause will not affect existing operations or permits for existing leases, and private lands will not be affected. The backlash from oil and gas producing states will be fierce and lawsuits have already begun, but the Biden administration views this policy as a key part of its climate agenda and is unlikely to change course.Ī1: In a January 27 executive order that introduced a sweeping, government-wide approach to climate policy, Biden announced several new oil and gas policies. ![]() oil and gas production coming from federal lands, the policy shift may have significant implications for future investment and production. President Joe Biden has followed through on a campaign pledge by introducing a moratorium on new oil and gas leasing on federal lands and waters.
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