Order Pauses Gas Leases on Federal Lands

President Joe Biden last week issued an executive order pausing new oil and gas leasing on federal lands and offshore waters. The pause was part of a larger plan to put combating climate change at the center of the nation’s energy and national security policies.

Biden wants to pursue initiatives aimed at a transition to green energy, decarbonization and a move away from fossil fuels.

While burning of natural gas emits far fewer greenhouse gas (GHG) emissions than coal, the industry is still a significant contributor due to emissions of methane, a potent greenhouse gas, through leaks, venting and the production process. Natural gas companies are recognizing the need to reduce greenhouse gas emissions and developing plans to move forward in a low-carbon environment.

A Department of Interior press release announcing the pause said it will provide a chance to review the federal oil and gas program and restore balance on the nation’s public lands, and notes that “fossil fuel extraction on public lands accounts for nearly a quarter of all U.S. greenhouse gas emissions.”

Of the more than 26 million acres under lease, nearly 13.9 million (or 53%) of those acres are unused while of the more than 12 million acres of public waters under lease, over 9.3 million (or 77%) of those acres are unused. While producers are sitting on about 7,700 issued permits for millions of acres, the former Trump administration offered more leases for sale.

The issue primarily affects Western states and Alaska, with expanses of public land that contain oil and gas reserves. However, in Pennsylvania the Allegheny National Forest contains approximately 517,000 acres of land in Elk, Forest, McKean and Warren counties in the northwestern corner of the state. Of that total, 9,916 acres are under lease and 4,723 acres were producing in 2019.

The executive order does not impact existing operations or permits for valid, existing leases, which are continuing to be reviewed and approved. However, the Biden administration’s goal is to conserve at least 30% each of public lands and waters by the year 2030 to safeguard the health and biodiversity of the country, and it is likely that there will be a new stance on leasing of federal lands, including the Arctic National Wildlife Refuge in Alaska.

Several industry groups, including the American Petroleum Institute, were critical of the decision. President and CEO Mike Sommers said in a press release that while API shares the goal of addressing climate change, the order is “a step backwards both for our nation’s economic recovery and environmental progress, threatening to cost thousands of jobs and much-needed revenue while increasing emissions by slowing the transition to cleaner fuels."