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Biden Trims Gulf Oil Lease Area to Protect Rare Whale Habitat

A Rice’s whale surfaces near a NOAA research vessel. Credit: NOAA Fisheries/ Mary Applegate

Biden Trims Gulf Oil Lease Area to Protect Rare Whale Habitat

Total Views: 1859
August 24, 2023

(Bloomberg) —

The Biden administration plans to auction 67 million acres in the Gulf of Mexico for oil and gas development in a lease sale next month, cutting 9% from the initial proposal.

The Bureau of Ocean Energy Management reduced the available territory by 6.4 million acres following a legal settlement with environmentalists to safeguard potential habitat of one of the world’s most endangered types of whales.

The agency is imposing new constraints on winning bidders in an effort to safeguard the species, the Rice’s whale, as federal regulators work to finalize plans to protect it. BOEM is also warning companies they shouldn’t count on speedy approvals for seismic surveys and other activity that could harm the whale.

The Sept. 27 auction — currently the last offshore oil sale planned by the US government — is set to be just above a 60-million-acre threshold mandated by the Inflation Reduction Act. A five-year plan for selling new offshore oil and gas leases in US waters expired June 30, and the bureau has not finalized a new one. 

Offshore oil advocates questioned the decision to shrink the size of the lease area in some of the most promising swaths in the Gulf of Mexico, which provides about 15% of US crude production.

The move, following the expiration of the leasing plan, erodes “long-term confidence and certainty in the Gulf of Mexico,” said Erik Milito, head of the National Ocean Industries Association. It also poses a “barrier to America’s energy production capabilities at a time when they’re needed more than ever, with inflation driving up the costs of everything for Americans including gasoline at the pump,” he said.

Environmentalists say the limits are necessary to ensure the survival of a whale species whose numbers have dwindled to as few as 51. Climate activists, meanwhile, have urged the administration to scrap the sale altogether, arguing the potential oil it could unleash has no role in a rapidly warming world.

© 2023 Bloomberg L.P.

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