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Federal Court: Biden’s suspension of oil leases may have been illegal


In the Western District of Louisiana, U.S. District Judge Terry Doughty, a Trump appointee, previously placed a hold on Joe Biden’s executive order imposing a moratorium on the sale of new drilling leases to oil and gas companies. Today, a federal appeals court in New Orleans will hear the case and determine whether or not the President is entitled to place such a restriction on new leases. A coalition of 13 states joined together to challenge the moratorium last year, claiming that the Interior Department lacks the authority to make such procedural changes and only Congress is empowered to do so. Lawyers for the White House argue that the opposite is true. Of course, much of the underlying dispute may soon be moot anyway, as we’ll get to in a moment. (Associated Press)

A federal appeals court in New Orleans hears arguments Tuesday about whether President Joe Biden legally suspended new oil and gas lease sales shortly after taking office because of climate change worries.

The case has not been tried but a federal judge blocked the order, saying only Congress could suspend the sales.

Federal lawyers say the government has broad power to hold, cancel or defer lease sales.

The plaintiffs appear to have a fairly well-developed argument here. The President and the Department of the Interior only have the ability to offer drilling leases because Congress granted them that authority long ago. There is no provision in the existing federal law allowing for the process to be “paused.” In fact, the opposite is true. In a 1987 update to the law, it specifically states that such leases “shall be made available four times per year” in states with eligible federal lands.

In other words, Biden’s executive order not only gummed up the normal process established by Congress, but it may have been a violation of federal law. It’s not as if he has to worry about his own Justice Department trying to prosecute him for this, but the contrast between the claims of the White House and the laws passed by Congress is glaring.

In the end, however, as I suggest above, none of this may wind up mattering very much. Joe Biden has already bent to the will of the angry citizens who are sick of high gas prices and begun scheduling more lease auctions. There are four such sales scheduled for the month of June in Nevada, New Mexico, Oklahoma, and Colorado. Similar sales in another four states are slated to be held shortly after that.

The only opposition to the new lease sales these days is actually coming from the oil and gas companies themselves. Industry executives are hesitant to expand their current operations for a variety of reasons. For one thing, there is a shortage of workers available to staff up new operations at the moment. Also, inflation impacts the oil and gas industry as much as anyone else. All of the costs associated with putting up a rig and starting to drill have risen. If the price of oil suddenly starts to crater again when production increases, they could wind up losing money on new drilling sites.

In any event, this entire mess began when Joe Biden took office and decided to keep a campaign promise by shutting down drilling on federal land. The predictable results have been damaging across the board and the President is very late to the party in terms of making a course correction now.