Biden’s oil and gas ban immediately challenged in Federal court

By Joel Rosenblatt on 1/27/2021

(Bloomberg) --The Biden administration’s moratorium of oil and gas leasing on federal public land faced an immediate legal attack from an energy industry group.

Western Energy Alliance, which says it represents 200 oil and natural gas companies, said the administration’s suspension of leases is “unsupported and unnecessary,” and an overreach by the U.S. Bureau of Land Management, according to a petition filed Wednesday in Wyoming federal court.

“Presidents don’t have authority to ban leasing on public lands,” Western Energy Alliance President Kathleen Sgamma said in a statement. “Drying up new leasing puts future development as well as existing projects at risk,” she said, adding that the move will cost tens of thousands and perhaps millions of jobs.

The administration moratorium issued Wednesday buys time for a broad review of whether fossil fuels should be extracted from lands under the U.S. government’s control. Environmentalists want President Joe Biden to make the suspension of leasing permanent. But even if he doesn’t, future leasing could encompass far less terrain and come with higher costs and environmental limits.

Although Biden has directed the Interior Department to pause new leases for oil and natural gas from public land and coastal waters, it will not affect ongoing operations on existing leases. And drilling permits for existing leases will keep flowing; more than two dozen have been issued already since Biden took office.

Beyond its two-page court petition, Western Energy Alliance said in its statement that the president’s order is a violation of the Mineral Leasing Act, the National Environmental Policy Act and the Federal Lands Policy and Management Act.

The group successfully challenged former President Barack Obama’s rule governing gas venting and flaring on federal land and also tangled with the Obama administration over fracking restrictions on public lands.

Wednesday’s suspension drew sharp criticism from other energy industry lobbyists, including the New Mexico Oil and Gas Association, which said one third of the state’s revenue comes from the oil and gas industry.

“This is a punch in the gut to our people and our economy,” Jim Wilcox, president of the Wyoming County Commissioners Association, said in a statement.

The case is Western Energy Alliance v. Biden, 21-cv-00013, U.S. District Court, District of Wyoming.

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