A historic auction in the US oil and gas sector was held today, 17 November. The auction is being held to lease vast oil and gas fields across a huge area of the country’s Gulf of Mexico. The government has received a revenue of 19 crore and 16 lac dollars from this auction. This is the highest revenue the government has earned from the leased oil and gas lands in any single auction since 2014.
This auction is especially important from another point of view besides statistical issues. During his campaign for the US presidency last year, democrat candidate Joe Biden promised to scrap oil and gas leases on centrally controlled land and in the deep sea. After winning the election and assuming the presidency, he instructed the Department of Interior to act in accordance with his promise. Following this, the Biden administration cancelled a pre-determined lease in the Gulf of Mexico.
However, a recent court order forced the government to lift the ban. In March, 12 oil and gas-producing states simultaneously turned to the courts. They petitioned the court to direct the Department of Interior to take action to reinstate the lease. They claimed that the decree issued by the White House did not follow the proper policy-making process. The time required for a public hearing on such an important decision was not given. In June, the Louisiana District Court ruled in favour of the lease.
The Department of Interior has appealed against the district court’s decision. However, they did not hesitate to comply with the court’s preliminary verdict. Following the ruling, the government held a lease auction of oil and gas fields in the Gulf of Mexico.
The auction also offers leases for 8 crore acres of unleased oil and gas fields in the Gulf of Mexico. Out of this, various companies have bought leases for 308 fields spread over an area of 16 lac acres. These include ExxonMobil, Chevron, BP, Royal Dutch Shell, etc. Chevron has invested the most; 4 crore and 71 lac dollars.
