Activists Threaten to Sue Over Interior Finally Approving New Mexico’s January Leases
More than four months after the original sale took place, the Department of Interior has finally issued more than three dozen oil and natural gas leases on federal lands from a January lease sale. WildEarth Guardians has threatened to sue over the action, despite it being outside of the parameters of the current pause on new leasing on federal lands.
These leases, sold during the final weeks of the Trump Administration across New Mexico, Texas, Oklahoma, and Kansas, highlight the Biden administration’s dedication to slow-walking the approval process for oil and natural gas development.
In one of his initial acts after taking office, President Biden ordered a moratorium on new oil and natural gas leasing on federal lands which prevented the Bureau of Land Management from hosting quarterly lease sales. But this order did not apply to the 37 leases sold in the final Trump administration lease sale in New Mexico in January.
Yet, despite the Mineral Leasing Act stating that “Leases shall be issued within 60 days following payment by the successful bidder,” this issuance didn’t happen until late April even though the sale took place on January 14. Notably, roughly 200 additional leases from sales in Wyoming, Utah and Colorado in December 2020 have yet to be approved.
Industry representatives have highlighted the administration’s delay in issuing the leases from the January sale. Kathleen Sgamma, president of the Western Energy Alliance, which has sued the administration to stop the moratorium, said:
“As is the Biden leasing ban, holding leases longer than 60 days violates the Mineral Leasing Act. Further, the leases were sold before the presidential order even existed. The environmental groups’ argument against issuing leases sold before an unlawful presidential order even existed is therefore nonsensical three times over.”
Sgamma’s reference to environmental groups was highlighted in a recent E&E News story on the lease issuances, with one group even threatening litigation:
“Jeremy Nichols, climate campaign director for WildEarth Guardians, said those leases shouldn’t have been finalized. Nichols, whose organization noticed with surprise the issuance of the New Mexico leases this month, said a lawsuit is ‘definitely on the table.’
“‘It’s just unfortunate,’ he said in an email. ‘With [Interior Secretary] Deb Haaland acknowledging that leasing under Trump flouted science, public and Tribal input, and integrity, it’s a shame that there may be a need to litigate more.’”
But that argument is completely backwards, as Sgamma explained. The January lease sale happened under the Trump administration, which clearly falls outside the Biden Administration’s executive order that “shall pause new oil and natural gas leases on public lands or in offshore waters pending completion of a comprehensive review.” (emphasis added)
That these lease sales took place under the Trump Administration was acknowledged by BLM last week, as Boise State Public Radio reported:
“Richard Packer, a BLM spokesperson, said the leases were issued after the agency determined that environmental reviews were complete and land management conflicts minimized.
“‘Lease sale postponements announced by the Biden-Harris administration have no impact on existing operations or permits for valid, existing leases,’ Packer said.”
States Feeling the Impact of the Leasing Order
The leasing moratorium is already having major adverse effects for states across the west, as Energy In Depth has noted, particularly in New Mexico where officials have warned rigs are already leaving because of the uncertainty caused by the pause on federal lands.
According to BLM, the January sale raised more than $4 million, which is split evenly between the federal government and the states. New Mexico was the biggest beneficiary, specifically the sale in Lea County:
“For this sale, the BLM offered leases on 37 parcels totaling 6,850.72 acres. The highest bid per acre was $15,101, which sold to PBEX, LLC for 80 acres in Lea County. The same parcel also received the highest bid per parcel with a total of $1,208,080.”
New Mexico accounts for nearly 60 percent of federal onshore oil production and development on federal lands contributed $1.5 billion in state revenue – or 18 percent of the state’s total spending. This revenue helps fund critical public services like education, healthcare, and emergency services.
Given the extensive planning, permitting, and environmental review processes, it often takes years to bring a project from the initial lease sale to production. This means that companies frequently hold a large number of leases to ensure that they can keep working towards their development plans over a span of years.
Interior’s release of a handful of leases more than four months after they were initially sold shows this process has ground to a halt as the impacts of the Biden administration’s lengthening moratorium continue to be felt.