A federal court in Louisiana has ruled that the Biden administration’s attempt to permanently ban new oil and natural gas development across millions of acres of federal waters was unlawful, helping to ensure access and certainty for offshore leasing moving forward.  

The decision follows a multi-year legal battle, with the ruling officially siding with oil and gas industry groups and Republican states who sued following the Biden administration’s push for a ban on offshore drilling leases.  

Following the ruling, American Petroleum Institute Senior Vice President and General Counsel Ryan Meyers explained why the ruling is a step forwards for U.S. energy:  

“We welcome the court’s decision to vacate this politically motivated decision and ensure our nation’s vast offshore resources remain a critical source of affordable energy, government revenue and stability around the world. This ruling marks another important step in advancing a robust new five-year offshore leasing program and ensuring the U.S. can meet rising energy demand.” 

Court Ruling Says Presidents Cannot Permanently Limit Energy Development 

The district court of Louisiana’s ruling looks specifically at the policy implications of the Outer Continental Shelf Lands Act, which authorizes the president to withdraw unleased areas from being developed.  

The recent ruling places key limitations on the act’s authorizations, namely that any withdrawals undertaken must have the ability to be reversed. By ensuring withdrawals cannot be permanent, the ruling ensures offshore leasing and subsequent domestic energy production are less vulnerable to political whims. 

As Judge James Cain explains in the ruling: 

“The language of § 12(a) itself establishes that withdrawals must be subject to reversal or modification. The statute specifies that the president may exercise this authority “from time to time,” which courts have recognized as encouraging an ongoing duty to revisit and amend regulations…The orders of President Obama and President Biden, on the other hand, purported to apply for a period of  time  without  specific  expiration,’  i.e.,  indefinitely.  To  the  extent  these  were  indeed  supposed  to  overcome  the  power  of  subsequent  executives  to  revoke  or  modify  their  withdrawals,  they  constituted  a  departure  from  the executive  branch’s  longstanding  practice.” (emphasis added) 

Widespread Criticism From the Start  

The Biden administration’s ban on new offshore oil and gas drilling, which blocked the sale of new leases for nearly 20 percent of all the seabed controlled by the United States, followed a long tenure of actions to hamper offshore production. The administration consistently rejected the need for U.S. energy security, instead – after unconstitutional delays and backlogs for its required program – opting to run the weakest offshore program in history, with little to no new oil or natural gas leases in the first 18 months.  

The legal challenges following Biden’s ban coincided with widespread criticism from industry experts and government officials, who sounded the alarm of the ban equating to an attack on the oil and gas industry.  

As Independent Petroleum Association of America (IPAA) Offshore Committee Chairman Ron Neal, the President of Houston Energy L.P. and CEO of HEQ Deepwater, emphasized at the time: 

“President Biden’s decision to ban new offshore oil and natural gas development across approximately 625 million acres of U.S. coastal and offshore waters is significant and catastrophic… This move is a first step towards more extensive restrictions all across our industry in all U.S. basins including the onshore.” 

And as National Ocean Industries Association’s (NOIA) Erik Milito explained: 

“The decision to unilaterally block areas from future offshore oil and gas development is a strategic error, driven not by science or voter mandate, but by political motives. This move directly undermines American energy consumers and jeopardizes the vast benefits tied to a thriving domestic energy sector.”

Similarly, members of Congress have consistently expressed concerns about the energy security and economic consequences of the ban. Ahead of the House Committee on Natural Resources’ oversight hearing in February, which discussed the negative implications of the policy, members of the committee wrote a scalding letter denouncing the ban:  

“The Biden administration’s January 6, 2025 withdrawal of 625 million acres of the OCS—spanning the Atlantic, Pacific, GOA, and northern Bering Sea—represents one of the most brazen retreats from long-term American energy security in U.S. history.” 

Republicans and industry groups sued the Biden administration over its offshore ban, urging the incoming Trump administration to “use every tool at their disposal to restore a pro-American energy approach to federal leasing.” 

Given President Trump’s focus on American energy dominance and previous critical comments about the ban, it is unsurprising that one of his first moves in office was to reverse Biden’s ban. The Trump administration has already begun work to strengthen the country’s offshore leasing program, with the Department of the Interior recently publishing a long-term schedule for offshore oil and gas lease sales in the Gulf of Mexico and Alaska’s Cook Inlet.  

Offshore Leasing Helps, Not Hurts, the Economy  

The federal ruling is welcome news as offshore leasing has major benefits for the U.S. economy and for the environment.  

According to the Bureau of Ocean Energy Management, during 2024, oil and gas development in the Outer Continental Shelf (OCS) alone supported 250,000 jobs and contributed $59.5 billion in economic output.  

The importance of offshore production is expected to only grow in the future, as power-hungry technologies like data centers cause power demand to skyrocket. As analyzed in Energy & Industrial Advisory Partner’s recent study on the economic impacts of a consistent offshore oil and natural gas leasing program, the federal OCS is projected to produce an average of 2.3 million BOE per day of oil and natural gas from 2025 to 2040. This energy can be used to power homes, businesses, and provide energy to U.S. allies, all while promoting energy security and independence.  

Additionally, U.S. oil and gas producers adhere to some of the strictest environmental standards in the world, producing necessary energy in more environmentally conscious ways, including in offshore leasing. For example, a study commission by NOIA revealed that the greenhouse gas intensity of U.S. oil production, particularly in the Gulf of Mexico, is “significantly lower compared to most other regions around the world.” Similarly, a 2022 McKinsey report found that the Gulf of Mexico releases less than half of the emissions per barrel compared with other major oil basins.  

The present and future essential role of oil and natural gas, underpinned by production in offshore areas, underscores why a strong and robust offshore leasing program is needed to ensure American energy, national, and economic security.   

Bottom Line: The federal court’s recent ruling on presidential authorization relating to offshore leasing sends a clear message: energy production and security cannot be indefinitely subjected to political whims. Offshore development is a critical part of America’s energy security and will remain that way.