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Brief # 117 – Environment Policy

Court Blocks Biden Administration Efforts to Suspend Oil and Gas Leases on Federal Lands

By Jacob Morton 

June 21, 2021

 

Policy Summary 

On Tuesday June 1, the Biden administration temporarily suspended all oil and gas drilling leases in the Arctic National Wildlife Refuge (ANWR), reversing one of former President Donald Trump’s most sought after and last-minute environmental policy changes. The suspensions came after President Joe Biden’s executive order, given on his first day in office, placed a moratorium on all new drilling leases on federal lands and waters, including the ANWR. That Executive Order requested a new environmental review specifically of the ANWR leasing program “to examine possible legal flaws in the program approved by the Trump administration.”

The review, conducted by the Department of Interior, found “defects in the underlying record of decision supporting the leases,” prompting Interior Secretary Deb Haaland to suspend them. Secretary Haaland announced a pause on the ANWR leases until her agency “completes an environmental analysis of their impact and a legal review of the Trump administration’s decision to grant them.” 

However, on Tuesday, June 15, Federal Judge Terry A. Doughty of the United States District Court for the Western District of Louisiana, granted a preliminary injunction declaring all the lease suspensions ordered under Biden’s original moratorium to be unconstitutional, and instructing the Interior Department to release those leases from suspension immediately. Judge Doughty’s ruling applies to all the oil and gas drilling leases suspended under Biden’s moratorium, not just the ANWR. Despite the Interior Departments argument that the decision to grant drilling leases in the ANWR may be legally flawed, Judge Doughty has included those leases in the court’s injunction. 

For over four decades, Democrats and Republicans have fought over the decision to drill in the ANWR. The refuge covers 19.3 million acres, about 1.6 million of which are coastal plains that, according to the US Geological Survey, sits atop an estimated 10.4 billion barrels of oil. The coastal plain between the Arctic Ocean and the mountains of the Brooks Range however, is also a winter home for pregnant polar bears, as well as the nearly 200,000 Porcupine caribou “that migrate between Alaska and Canada, using the plain as a nursery in the spring.” The entire refuge represents one of the largest “unspoiled, intact ecosystems left on the planet,” and has been protected since 1960, being designated a national wildlife refuge in 1980.

During his time in office, Donald Trump made opening up the coastal plain to drilling a top priority in his push for increasing domestic fossil fuel production. In 2017, the republican controlled congress proposed an environmental review be conducted of a potential land leasing program for the coastal plain acreage. That analysis was published last year and gave a green light to the administration to begin dividing tracts and selling leases.

Upon the release of that report, environmental groups immediately sued the Trump administration, arguing that amongst other issues, “the analysis discounted the impact of oil and gas production on climate change.” CBS News reports that the ANWR is “warming twice as fast as any other region on the Earth due to climate change.” Gwich’in tribal members in the Arctic Village and Venetie communities say, “the leases are an affront to their culture and way of life.” The tribes also filed a federal lawsuit against the selling of land leases in the refuge.

Despite the fact that the issue had not yet been settled in courts, the Trump administration began selling leases just weeks before leaving office after losing reelection in 2020. However, drilling in the refuge has become so contentious that only 9 of the 22 leases offered were even bid for. Two small companies ventured to make bids for “10-year rights to explore and drill for oil on two tracts totaling about 75,000 acres.” Major oil companies expressed little interest, at least publicly, in bidding for leases, “given the high cost of producing oil in the Arctic, the growing desire to reduce fossil fuel use, and the reputational risks of drilling in such a pristine area.” 

Major banks even refused to finance any drilling projects in the refuge, facing pressure from tribal groups and environmental organizations. Another 7 tracts, totaling about half a million acres, were bid on by the state-owned Alaska Industrial Development and Export Authority. These bids however, raised legal concerns of whether or not the state could legally purchase leases. This and other legal issues have not yet been resolved. Interior Secretary Haaland’s suspension of the lease program was only temporary and “The administration had only committed to reviewing the Trump leases, not canceling them. If it determines that the leases were granted illegally, it could then have legal grounds to cancel them.”

Analysis 

Elected officials in Alaska and other conservatives were disappointed and angered by the suspension. Republican Governor of Alaska Mike Dunleavy claims “Alaska does responsible oil and gas development in the Arctic under stricter environmental standards than anywhere else in the world. Yet the federal government is focused on trying to stop our ability to produce oil and gas.” Despite the lack of interest by major oil companies, as demonstrated by the meager success of the lease sale program, and the fact that major automotive companies like GM have committed to significant transitions to clean energy vehicles, Dunleavy still proclaims that, “Each action they take demonstrates a failure to comprehend the worldwide demand for oil and gas.”

What Governor Dunleavy may not comprehend is that just last month, the International Energy Agency, the world’s leading authority on energy policy, released a new report warning that governments around the world “must immediately stop approving new coal-fired power plants and new oil and gas fields and quickly phase out gasoline-powered vehicles if they want to avert the most catastrophic effects of climate change.”

U.S. Senator from Alaska, Lisa Murkowski, said of the suspension, “This action serves no purpose other than to obstruct Alaska’s economy and put our energy security at great risk. Alaskans are committed to developing our resources responsibly and have demonstrated our ability to do so safely to the world.” Conservative groups, like the Competitive Enterprise Institute, an organization that worked closely with the Trump administration to overturn numerous environmental protections throughout Trump’s single term, contest the lease suspensions as being illegal. Devin Watkins, an attorney for the Competitive Enterprise Institute says, “The government cannot enter into a contract to take over $14 million and then invalidate the contract without cause. No cause for canceling the ANWR leases has been provided.” Alan Weitzner, executive director of the Alaska Industrial Development and Export Authority, also argues that “the Biden administration had yet to provide documentation of any deficiencies that would warrant a suspension of leases.”

Governor Dunleavy says, “We are not going to allow the Biden administration to turn Alaska into a giant national park.” Perhaps the Governor is unaware that the ANWR has already been designated a national wildlife refuge, with even greater restrictions than a national park, since 1980. It was only during the Trump administration and through what Kristen Miller, acting executive director of the Alaska Wilderness League, calls a “flawed and legally deficient process,” that the prospect of opening the land to drilling became possible.

Environmental groups and Tribal communities have expressed gratitude for the suspensions. Gene Karpinski, president of the League of Conservation Voters, says, “Suspending leases in the Arctic Refuge is a major step forward in keeping President Biden’s campaign promise and cutting carbon pollution.” Tonya Garnett, special projects coordinator for the Native Village of Venetie Tribal Government, acknowledged the importance of the administration’s decision, saying “this goes to show that, no matter the odds, the voices of our tribes matter.”

Policy experts, however, were quick to point out the timing of this decision, suggesting it may be a response to the criticism President Biden has received for recent fossil fuel-friendly actions taken by his administration. The White House recently approved a multibillion dollar oil drilling project with ConocoPhillips, Alaska’s largest oil producer, in the National Petroleum Reserve; in court opposed shutting down the Dakota Access pipeline, which carries 550,000 barrels of oil daily through private farmland in Iowa and the Upper Sioux Tribe territory in Minnesota, including the Big Sioux Wildlife Management Area and Tribal burial grounds; and upheld 440 oil and gas leases on federal lands in Wyoming previously issued by the Trump administration.

Supporters of the suspensions recognize the timing of the decision but viewed it as an opportunity for the administration and congress to set a new standard for environmental justice and stewardship in the ANWR and across the country. Bernadette Demientieff, executive director of the Gwich’in Steering Committee, said in a statement, “After fighting so hard to protect these lands and the Porcupine caribou herd, trusting the guidance of our ancestors and elders, and the allyship of people around the world, we can now look for further action by the administration and to Congress to repeal the leasing program.”

Karpinski, with the League of Conservation Voters, presses this point, saying, “Going forward, we also need to ensure the administration keeps its climate commitment across the board. A ‘drill here, don’t drill there’ approach will not get the job done.” Miller, with the Alaska Wilderness League, points to the road ahead, “Until the leases are canceled, they will remain a threat to one of the wildest places left in America. Now we look to the administration and Congress to prioritize legislatively repealing the oil leasing mandate and restore protections to the Arctic Refuge Coastal Plain.”

That threat is all too real and present. In March, Jeff Landry, the Republican attorney general of Louisiana, along with attorneys general (all Republican) from 12 other states sued to revoke President Biden’s Executive Order to halt all new drilling leases on federal lands and waters, including the ANWR. As mentioned, just this past Tuesday, Federal Judge Terry A. Doughty of the United States District Court for the Western District of Louisiana (appointed by Donald Trump) granted a preliminary injunction against the administration’s lease suspensions, stating that the power to suspend those leases “lies solely with Congress” because it is the legislative branch that originally voted to open those lands and waters for leasing. The injunction was granted nationwide, a rare move by a federal court. 

Judge Doughty argued that the 13 states that filed suit “had demonstrated that their economies could be irreparably harmed by the pause on drilling,” and that the White House’s pause on new drilling leases should end nationwide. Doughty wrote, “Millions and possibly billions of dollars are at stake.” Judge Doughty ruled that Secretary Haaland and the Department of Interior “are hereby enjoined and restrained from implementing the pause of new oil and gas leases on public lands or in offshore waters” until final rulings are decided for the cases of the 13 plaintiff states. Those 13 states include: Louisiana, Alabama, Alaska, Arkansas, Georgia, Mississippi, Missouri, Montana, Nebraska, Oklahoma, Texas, Utah, and West Virginia. 

According to a spokeswoman for the Interior Department, the agency will continue to work on an interim report for President Biden “about the state of the federal oil and gas drilling programs, as well as recommendations on the future of the federal role in drilling on public lands.” Secretary Haaland is expected to deliver those recommendations to the President by the end of the summer. Randi Spivak, public lands program director at the Center for Biological Diversity, says, “The judge’s order turns a blind eye to runaway climate pollution that’s devastating our planet. We’ll keep fighting against the fossil-fuel industry and the politicians that are bought by them.”

Engagement Resources

Alaska Wilderness League – Alaska Wilderness League

  • URGE CONGRESS TO PROTECT THE ARCTIC REFUGE! With drilling leases in oil company hands and another lease sale on the horizon, we need Congress to make legislative action a reality. It must restore protections as soon as possible. Alaska Wilderness League protects Alaska’s public lands by fighting for wilderness, wildlife, Indigenous rights, and a cleaner energy future. 

League of Conservation Voters – STOP THE GIVEAWAYS TO BIG OIL 

  • Tell your Representatives: STOP THE GIVEAWAYS TO BIG OIL! Big Oil is pressuring members of Congress to oppose Biden’s leasing pause and their allies in Congress have introduced legislation to roll back the pause. To protect our environment, our climate, taxpayers, and frontline communities from drilling projects we need Congress to hear from you now. 

Center for Biological Diversity – Center for Biological Diversity

  • We seek to strengthen our core environmental laws, support lawmakers from all political parties that believe in a healthier environment, and to hold accountable any politician regardless of party who does not.

References

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