A federal appeals court has given the go-ahead for a controversial Gulf of Mexico oil lease sale, including acreage that had previously been excluded to protect an endangered whale, to proceed on Dec. 20.
Lease Sale 261 was initially scheduled for Sept. 27 and then reset for Nov. 8 as a result of federal court decisions. The Biden administration had pared back the size of the lease sale in August as a way to protect the habitat of Rice’s whale in the northeastern part of the Gulf, a move that caused the state of Louisiana, American Petroleum Institute (API) and Chevron USA to challenge the restrictions in federal district court.
The lower court granted the plaintiffs an injunction setting aside the Bureau of Ocean Energy and Management (BOEM) restrictions on the sale, and the Fifth Circuit left the injunction in place because BOEM did not specifically challenge it in the latest legal round. Several environmental groups that intervened in the case did challenge the injunction on appeal, but the court dismissed that challenge because the groups lacked standing.
The Fifth Circuit said it was not clear at present whether oil companies would bid on those tracts within the whale’s habitat. It was also uncertain whether any whales would be harmed by oil-and-gas activities, the court said.
“Because intervenors have failed to show that their alleged injury is ‘certainly impending’ or likely to be redressed by a favorable decision here, intervenors lack standing to independently prosecute this appeal,” the appeals court opinion states. “Intervenors’ appeal is therefore dismissed.”
Oil industry officials saw the latest ruling as a positive step, since the previously removed locations in the sale were restored and vessel travel restrictions overturned. But they also expressed disappointment because of lease sale delays resulting from the legal dispute.
“The administration has thrown up roadblock after roadblock to discourage offshore oil and natural gas production, underscoring the importance of this court-ordered sale as the final opportunity to obtain acreage in federal waters until 2025 at the earliest,” Holly Hopkins, API’s vice president of upstream policy, told the Louisiana Record in an email. “With U.S. offshore production supplying among the lowest carbon-intensive barrels in the world, access to these resources is critical to ensuring America can continue to lead the world in affordable, reliable and cleaner energy.”
In a Nov. 16 news release, BOEM said the newly scheduled lease sale would be live-streamed as opening bids are taken at 9 a.m. Central Daylight Time on Dec. 20.
“Pursuant to direction from the court, BOEM will include lease blocks that were previously excluded due to concerns regarding potential impacts to the Rice’s whale population in the Gulf of Mexico,” BOEM reported.
Mike Moncla, president of the Louisiana Oil & Gas Association, said LOGA was hopeful that the lease sale would finally become a reality.
“But it would not be surprising if the Biden administration continued their legal efforts to halt it," he told the Record in an email. "Louisiana Sen. Bill Cassidy said it best: All of this (was) over the sighting of ONE Rice’s whale sighting in the Gulf. At a minimum, this president needs to stick with the commitment he made in the Inflation Reduction Act.”
The state of Louisiana sided with the oil industry in the litigation, fearing how a restricted lease sale would affect the state’s economy and government revenues. But the Sierra Club, one of the environmental intervenors, said the lease sale could spell disaster for the Rice’s whale.
“The sale could force the Rice’s whale, the only whale species located entirely within U.S. territorial waters and whose habitat overlaps with the proposed lease sale, into extinction,” the Sierra Club said in a statement. “The Rice’s whale population numbers as few as 50 individuals. …”
Devorah Ancel, a senior Sierra Club attorney, expressed disappointment with the appeals court opinion.
“With this ruling, the court is allowing this lease sale to proceed without crucial mitigation measures that would protect what is quite possibly the most critically endangered whale species on earth,” Ancel said in a prepared statement. “The loss of even a single Rice’s whale could drive the species to the brink of extinction, and selling off its habitat for oil and gas development will only further harm this rare species.”