Biden Continues Preparations for Federal Oil and Gas Leasing

According to an announcement from the Department of the Interior on Friday morning, oil and gas contracts on federal property are set to be issued again in the coming months. 

Two days earlier, a federal appeals court granted the agency a temporary injunction, enabling it to continue applying the Biden administration’s enhanced societal cost of carbon, or SCC, in its leasing decisions. 

Public Land and Waterways

In a comment to Bloomberg, Interior Department spokeswoman Melissa Schwartz stated the following:

“With this decision, the Department maintains its preparation for safe oil and gas production on America’s public lands and waterways.” 

According to the Interior Department, “Calculating the societal cost of greenhouse emissions provides crucial information that has served as a foundation for the department’s work over the past year.” 

The government did not provide a specific date for when it would begin issuing new contracts and permits to businesses.

According to Reuters, the Department of the Interior’s Bureau of Land Management planned lease auctions in numerous states before a February court judgment prohibited the administration from using the inflated SCC figure. 

The SCC was increased from $7 to $51 per ton of emissions when President Biden assumed office in 2021, following an executive order.

Using the SCC, it will be possible to estimate the economic harm caused by carbon dioxide emissions. 

The plaintiffs in a lawsuit launched by ten Republican-led states were successful last month.

Judge James Cain Jr. of the United States District Court for the Western District of Louisiana ruled the Biden administration lacked the power to enhance the climate metric. 

After the verdict was made, the Biden administration stated its oil and gas leasing program would be delayed while it raced to file an appeal with the Supreme Court. 

Law Limitations

A ruling issued on Wednesday by the 5th Circuit Court of Appeals allowed the Biden administration to reinstate the enhanced SCC, while it considers the matter temporarily.

As a result, the Interior Department announced on Friday it would resume issuing new leases and licenses for drilling on public lands. 

An order was given last month by a U.S. District Judge in Louisiana, prohibiting agencies from taking into account the harm caused by climate change. This is also known as the “social cost of carbon” and was stayed by the U.S. Court of Appeals for the Fifth Circuit. 

At every level of government, this statistic is used in rulemaking, from the issuance of new drilling licenses to analyzing the expanding potential for harm, such as crop failure and flood hazards. 

However, until a final decision is reached on the case’s merits, the Biden presidency can continue to evaluate the economic costs of climate change.

This comes even as the administration writes new rules, while also strengthening existing ones that could pivot America closer to Biden’s goal of slashing emissions by more than half.

Because comprehensive climate legislation is now stuck in Congress, the administration relies on these measures to accomplish its carbon reduction targets for the year.