WASHINGTON – For close to a century, the Gulf of Mexico’s offshore oil and gas industry has pumped vast wealth into the economies of coastal Texas and Louisiana — all under the management of the federal government.
But the Gulf and other federally controlled oil regions across the Western United States are facing an uncertain future under President-elect Joe Biden, who has pledged to halt oil and gas leasing on federal lands and waters in a bid to fight climate change.
Even if Republicans retain control of the Senate, Biden will have executive authority over federal lands and the Outer Continental Shelf. Should he carry through on his campaign promise, his administration would begin winding down the Gulf of Mexico’s offshore industry, along with drilling operations in states with an abundance of federally controlled land, such as Colorado and New Mexico.
Since winning election last week, Biden has not said if, when and how he will carry through on his campaign pledge. But with the Democrats’ progressive wing increasingly vocal about climate change, many in Washington are expecting he will move ahead.
“Presidents usually try to fulfill their campaign promises, so I think we’ll be surprised how much he does,” said Ben Cahill, a senior fellow at the Center for Strategic and International Studies, a Washington think-tank from which oil companies have long taken advice. “Stopping offshore leasing is part of a long-term pivot on climate and energy for the Biden administration. It’s about signaling they will reduce dependence on the oil and gas sector.”
Biden’s push to address climate change is already drawing political push-back in Washington.
President Donald Trump is moving to hamstring Biden’s environmental agenda with a series of rules to further weaken U.S. environmental protections before he leaves office in January. On Monday, the administration announced it would soon auction off oil and gas leases in Alaska’s Arctic National Wildlife Refuge — 19 million acres of mostly untouched wilderness where Biden has opposed development.
The Biden transition team did not respond to multiple requests for comment.
A Biden halt in leasing would accelerate what is believed to be an inevitable decline in oil and gas production in the Gulf of Mexico after a century of steady drilling. A recent report by research firm Wood Mackenzie found that were leasing halted, production in the Gulf would hold relatively steady until 2027 before dropping off. By 2035, output would fall to 1.5 million barrels a day, 30 percent less than it would be otherwise.
Even at today’s low prices, the Gulf of Mexico’s offshore oil industry generates almost $30 billion a year in revenues, spurring oil and gas lobbyists in Washington to try to hold off a halt on leasing.
Erik Milito, a longtime energy lobbyist and president of the National Offshore Industries Association, said he has warned the incoming administration that more than 300,000 jobs are at stake. At a time when millions of Americans remain out of work because of the coronavirus pandemic, Milito said he remained hopeful that Biden wouldn’t carry through on his pledge to halt leasing.
“In the conversations we’ve had with individuals working with the (Biden) campaign, they understand the consequences of a leasing ban,” he said.
Trump’s fight
The Trump administration’s actions to open up federal land to further exploration come amidnumerous signs that climate change is already making the planet less hospitable, with increased hurricanes and flooding in the Gulf of Mexico and record wildfires throughout the Western United States. Scientists are warning that conditions will only become worse as temperatures rise through the end of the century, creating the potential for mass crop failures and water shortages.
That is bringing increased political pressure on Biden to act.
The World Resources Institute, a Washington nonprofit that works with governments and companies on reducing emissions, is calling for Biden to set a target of a 45 percent to 50 percent reduction in greenhouse gas emissions by 2030 when he rejoins the Paris agreement on climate change, as he’s promised to do.
That would involve a massive undertaking, including ramping up the amount of renewable energy on the U.S. power grid to 60 percent from about 17 percent now, while also reducing methane emissions from oil and gas operations by 60 percent, according to the institute.
“The terrain has fundamentally shifted since Biden was last in the White House. Other G20 countries are stepping up. China’s set a target to zero out emissions before 2060,” said Helen Mountford, vice president for climate and economics at WRI. “Joe Biden will only have a short honeymoon to catch up.”
Biden’s plan
Biden is already setting the goal of getting the United States on the path to net-zero emissions by 2050, in line with what scientists say is necessary for the world to limit the rise in global temperatures to 2 degrees Celsius and avoid environmental disaster.
Curtailing oil and eventually natural gas production would be critical to achieving thenet-zero goal. American oil and gas output grew steadily over the last decade with the advent of hydraulic fracturing and horizontal drilling, which unlocked deposits long thought too difficult to access economically and drove U.S. oil production to a record 13 million barrels a day before the pandemic hit earlier this year.
Read it from HoustonChronical– As seen on HoustonChronical (“In this file photo President-elect Joe Biden speaks in Wilmington, Del. The Gulf of Mexico and other federally controlled oil regions across the Western United States face an uncertain future under President-elect Joe Biden, who has pledged to halt oil and gas leasing on federal lands and waters to fight climate change.”)
