Judge Permanently Blocks Biden Oil and Gas Leasing Pause in 13 States

President Joe Biden speaks from the Blue Room Balcony of the White House on Aug. 1, 2022. Jim Watson/Pool via AP

A federal judge issued a permanent injunction on Aug. 18 against the Biden administration’s pause of new oil and gas leasing in federal lands.

The injunction applies to the 13 states that sued the Biden administration over the moratorium in March 2021, including Alabama, Alaska, Arkansas, Georgia, Louisiana, Mississippi, Missouri, Montana, Nebraska, Oklahoma, Texas, Utah, and West Virginia.

Terry Doughty, U.S. district judge for the Western District of Louisiana, ruled that the White House overreached with the ban.

President Joe Biden signed Executive Order 14008 on Jan. 27, 2021, banning all new oil and natural gas leases on federal lands and offshore waters. The order didn’t cancel existing leases on federal lands and offshore waters. Leases on private lands also weren’t affected.

Thirteen states, led by Louisiana, sued the Biden administration, saying the lease ban violated the Outer Continental Shelf Lands Act (OCSLA), which governs offshore oil and gas leases, and the Mineral Leasing Act (MLA), which governs onshore land leases on federal lands.

Doughty issued a temporary injunction in the case in June. The injunction was overthrown by the 5th U.S. Circuit Court of Appeals on Aug. 17.

Doughty’s permanent injunction came a day after the circuit court’s ruling (pdf). In the permanent injunction, Doughty ruled that the executive branch has no authority to change both laws.

“Both statutes require Government Defendants’ agencies to sell oil and gas leases. The OCSLA has a Five-Year Plan in effect that requires eligible leases to be sold. Government Defendants’ agencies have no authority to make significant revisions in the OCSLA Five-Year Plan without going through the procedure mandated by Congress. The MLA requires the DOI to hold lease sales, where eligible lands are available at least quarterly,” he wrote in the ruling (pdf). “By stopping the process, the agencies are in effect amending two Congressional statutes. Neither the OCSLA nor the MLA gives the Government Defendants’ agencies the authority to implement a Stop of lease sales.”

Interior Department and the White House officials didn’t respond to requests for comments by press time.

Louisiana Attorney General Jeff Landry in Washington on July 26, 2022. Matthew Pearson/CPI Studios

“President Biden’s executive order to choke off energy development didn’t just increase prices and hurt American families—it was flatly illegal. This decision is a victory for the rule of law and the workers and the rural communities who depend on the energy industry,” he said in a statement.

An ongoing lease moratorium would have lowered employment by 210 jobs, reduced personal income by $13 million, and cost $4 million in oil and gas taxes in Montana in 2021, he said, citing a December 2020 study conducted by the University of Wyoming.

Biggest Offshore Oil, Gas Lease Sale Revived

Days before the permanent injunction, a lease known as Lease Sale 257, which is also under dispute in the multiple-state lawsuit, was revived by Biden through the so-called Inflation Reduction Act.

The Inflation Reduction Act includes provisions that direct spending, tax credits, and loans to bolster technologies such as solar panels and equipment to cut pollution at coal- and gas-powered power plants.

But the legislation also contains a provision that reinstates the previously halted Lease Sale 257, which was sold at auction for $192 million in March 2019, the biggest offshore oil and gas lease in U.S. history, spanning nearly 81 million acres in the Gulf of Mexico.

In this aerial image from a drone, tug boats tow the semi-submersible drilling platform Noble Danny Adkins through the Port Aransas Channel into the Gulf of Mexico in Port Aransas, Texas, on Dec. 12, 2020. Tom Pennington/Getty Images

The Bureau of Ocean Energy Management indicated its intention to rescind the lease sale in February 2021, citing Executive Order 14008. The lease sale was later revived by the government. However, it was then challenged by environmental activist groups and halted by Judge Rudolph Contreras of the U.S. District Court of the District of Columbia.

Contreras ruled in January that the decision to proceed with the lease sale was “arbitrary and capricious.”

The ruling de facto blocked Lease Sale 257 because the Biden administration didn’t appeal.

Tom Ozimek contributed to this report.