Biden administration floats new oil leasing plan in Gulf of Mexico

US president Joe Biden is likely to sell new oil leases in offshore waters despite his election campaign pledge to shut down drilling for fuels on federally owned territory, according to a proposal released late on Friday.

His administration set out several options for sales of leases to oil producers, including up to 10 auctions for rights in the Gulf of Mexico and another potential round of bidding off Alaska. However, the proposal by the US interior department ruled out new exploration along the Atlantic and Pacific coastlines.

The White House has struggled to advance an ambitious climate agenda while addressing voter dismay over high petrol prices that have contributed to the highest US inflation rates in 40 years.

Efforts to clamp down on planet-warming emissions from fossil fuels suffered another blow this week when the Supreme Court curtailed the federal government’s powers to regulate coal-fired power plants.

Publication of the government’s offshore leasing programme, required by law, immediately drew fire from the oil industry, which wanted a more expansive plan, and climate activists who called on the administration to stick to its pledge to end drilling on federal lands.

The interior department said it would start soliciting public comments for the proposed lease areas. The first lease sales would be held in 2023.

One option to be considered would allow no new lease sales for the next five years, a step that leaves open the possibility of ending drilling in federal waters. The latest offshore lease sale, held in late 2021 under the previous five-year plan, was thrown out in court.

“President Biden and I have made clear our commitment to transition to a clean energy economy,” said Deb Haaland, interior secretary. “The time for the public to weigh in on our future is now.”

Frank Macchiarola, senior vice-president at the American Petroleum Institute, the oil lobby, said the prospect of a halt to lease sales threatened US security.

“At a time when Americans are facing record high energy costs and the world is seeking American energy leadership, tonight’s announcement leaves open the possibility of no new offshore lease sales, the continuation of a policy that has gone on for far too long,” he said.

Athan Manuel, lands protection director at environmental group the Sierra Club, said the administration should commit to issuing “no new offshore leases, period”.

“At a time when we need to be rapidly transitioning away from dirty oil and gas to meet our climate commitments and avert the worst of the climate crisis, the last thing we need is to sell off even more of our waters to the fossil fuel industry,” Manuel said.

Biden’s promise to end oil and gas drilling on federal lands has fallen by the wayside as his administration has faced strong pushback from the oil industry, courts and oil-and-gas producing states, including those represented by Democratic allies.

Record high fuel prices have left him vulnerable to attacks that he is putting limits on domestic fossil fuel supplies. Offshore production in the Gulf of Mexico accounts for about 1.7mn barrels a day of crude, or 15 per cent of total output.

The government held its first onshore oil and gas lease sale this week in Wyoming, but only after sharply reducing the amount of land on offer and raising royalty rates charged to oil drillers by 50 per cent.