Biden Bans E&Ps from 625 Million Acres of Offshore Oil, Gas Leases

The Biden administration, as expected, has withdrawn more than 625 million offshore acres from future oil and gas leasing, the largest such ban in U.S. history, according to the U.S. Interior Secretary Deb Haaland.

The plan permanently bars the sale of new oil and gas leases along the Atlantic coast, the Pacific coast, the eastern Gulf of Mexico and portions of the Northern Bering Sea. Nothing in this withdrawal affects rights under existing leases in the withdrawn areas, the White House said.

The National Outer Continental Shelf Oil and Gas Leasing Program for 2024-2029, which includes three potential oil and gas lease sales in the Gulf of Mexico planning areas, are not impacted by the decision, Haaland said in a news release.

“President Biden’s actions today are part of our work across this administration to make bold and enduring changes that recognize the impact of oil and gas drilling on our nation’s coastlines,” Haaland said. “Today, the president is taking action that reflects what states, tribes and local communities have shared with us—a strong and overwhelming need to support resilient oceans and coastlines by protecting them from unnecessary oil and gas development.”  

Haaland noted that on federal lands and waters, oil production in 2024 was at an all-time high. 

“In fiscal year 2023, the Outer Continental Shelf (OCS) produced approximately 675 million barrels of oil and 796 billion cubic feet of gas, accounting for roughly 14 percent of all oil production and two percent of natural gas production in the United States,” Haaland said. “Nearly all of this production is in the Western and Central Gulf of Mexico, where industry has yet to produce on more than 80 percent of the 12 million acres already under lease.”   

However, Ron Neal, offshore committee chairman for the Independent Petroleum Association of America (IPAA), called the administration’s plans “significant and catastrophic.”

“While it may not directly affect the currently active production areas in the Outer Continental Shelf (OCS) and adjoining coastal areas, it represents a major attack on the oil and natural gas industry,” said Neal, who is president of Houston Energy LP and CEO of HEQ Deepwater.

Neal told Hart Energy Biden’s move represents an assault on all of the industry all over the country, including onshore.
“It does affect the future viability of the American oil industry. This is a move meant to kill any further work in federal and adjacent state waters.,” he said. “My experience is that when you come for one you come for all.”

According to the White House, the ban includes the entire eastern U.S. Atlantic coast and the Eastern Gulf of Mexico, encompassing approximately 334 million acres of the Atlantic OCS from Canada to the southern tip of Florida and the Eastern Gulf of Mexico.

“There are currently no active oil and natural gas leases in federal waters off the eastern Atlantic coast,” the White House said.

The southern section of the withdrawal matches a previous Congressional withdrawal enacted by the Gulf of Mexico Energy Security Act of 2006, and a subsequent time-limited withdrawal issued by the first Trump administration that would have expired in 2032 without further action, according to the White House.

“The withdrawal builds on those prior withdrawals and helps safeguard the multi-billion-dollar fishing and tourism economies in these states,” the White House said.  

Along the California, Oregon and Washington’s Pacific Coast, nearly 250 million acres of federal waters will be excluded from oil and gas leasing. The areas are “prime habitat for seals, sea lions, whales, fish, and countless seabirds,” the White House said.

California has had a moratorium on issuing new leases in its state waters since 1969, and the last federal lease sale in the area was withdrawn offshore Southern California in 1984.

The order further shuts off access to the Northern Bering Sea Climate Resilience Area in Alaska, which comprises approximately 44 million acres.

Frank Maisano, senior principal at Bracewell LLP, said Biden is attempting to use a 1950s law, the Outer Continental Shelf Lands Act, to block future oil and gas drilling.

“Remember, President Trump has already prevented drilling in most of these areas until 2032, so this won't do much, and portions that are questionable…like maybe slivers of the Eastern Gulf are likely to be the focus of quick Congressional action (as new Senate Energy Chairman Mike Lee has already mentioned),” Maisano wrote in a Jan. 6 commentary. “The Biden effort is not quite ‘epic’ or historic action. In fact, it is largely symbolic yet completely tone deaf to the demands of Americans on energy. Perhaps, it is why President Biden and Vice President Harris were tossed out of office by voters in November.”

Biden said the exclusions were supported by Republican and Democrat governors and members of Congress. He also cited the 2010 Deepwater Horizon oil spill in the GoM as “a solemn reminder of the costs and risks of offshore drilling.”

“In balancing the many uses and benefits of America’s ocean, it is clear to me that the relatively minimal fossil fuel potential in the areas I am withdrawing do not justify the environmental, public health and economic risks that would come from new leasing and drilling,” Biden said.

On Jan. 5, American Petroleum Institute President and CEO Mike Sommers said American voters had sent a clear message of support for domestic energy development. He called Biden’s decision politically motivated.

Robust offshore oil and natural gas development could generate more than $8 billion in additional government revenue by 2040, he said. He also noted that offshore resources are also among the lowest carbon-intensive barrels produced anywhere in the world, according to McKinsey & Co.

“The current administration is using its final days in office to cement a record of doing everything possible to restrict it,” Sommers said in a press release. “Congress and the incoming administration should fully leverage the nation’s vast offshore resources as a critical source of affordable energy, government revenue and stability around the world. We urge policymakers to use every tool at their disposal to reverse this politically motivated decision and restore a pro-American energy approach to federal leasing.”