Gulf of Mexico offshore oil lease plan voided by U.S. judge

The sale of offshore oil and gas leases on more than 80 million acres in the Gulf of Mexico was canceled by a U.S. judge who ordered regulators to take a harder look at the impact on climate change.
U.S. District Judge Rudolph Contreras in Washington vacated the lease sale in a 67-page decision, issued Thursday. The judge found that the Interior Department underestimated the climate impacts of the leases and doing a further analysis wouldn’t overly harm the companies seeking the leases.

“The leases have not become effective and no activity on them is taking place,” the judge wrote. If the leases were to take effect, it would be much harder to cancel them, Contreras said.

The judge also criticized the Interior Department -- writing that it acted “arbitrarily” -- for failing to factor into its assessment the climate effect of the burning of oil and gas from the leases in countries outside the U.S.

The court’s decision throws into doubt the November sale of some 308 tracts spanning 1.7 million acres (688,000 hectares) of the Gulf of Mexico. Thirty-three oil companies spent about $192 million buying the drilling rights in the auction, the second-to-last scheduled under a five-year program drawn up by the Obama administration. And it raises questions about a possible Gulf auction in spring.

In one of his first acts as president, Joe Biden put a temporary halt on all new oil and gas leasing. But last year, a federal judge in Louisiana ordered the Biden administration to move ahead with the leases. Environmental groups then sued to halt the sale.