Judge Blocks Gulf Oil Lease Scale-Back

NEW ORLEANS (AP) -- A federal judge has ordered the Interior Department to expand next week's scheduled sale of Gulf of Mexico oil and gas leases by millions of acres, rejecting a scaled-back plan announced last month by the Biden administration as part of an effort to protect an endangered whale species.

The Biden administration on Friday asked the 5th U.S. Circuit Court of Appeals in New Orleans to block the order issued Thursday night in Lake Charles, Louisiana, by U.S. District Judge James David Cain Jr. Environmental groups represented by the Earthjustice organization also appealed.

As originally proposed in March, the Sept. 27 sale was would have made 73 million acres (30 hectares) of offshore tracts available for drilling leases. That area was reduced to 67 million acres (27 hectares) in August when Interior's Bureau of Ocean Energy Management announced final plans for the sale. Cain's injunction restores the original coverage area.

BOEM's revision also included new speed limits and requirements for personnel on industry vessels in some of the areas to be leased --- also blocked by Cain's order.

BOEM had adopted the reduced area and new rules for next week's sale as part of an agreement the administration reached last month with environmentalists in efforts to settle a whale-protection lawsuit filed in federal court in Maryland.

Chevron, Shell Offshore, the American Petroleum Institute and the state of Louisiana sued to reverse the cut in acreage and block the inclusion of the whale-protecting measures in the lease sale provisions. They claimed the administration's actions violated provisions of a 2022 measure, labeled the Inflation Reduction Act, that provided broad incentives for clean energy, along with creating new drilling opportunities in the Gulf. They also said the changes after the initial lease sale was proposed in March violate federal law because they were adopted arbitrarily, without sufficient explanation of why they are needed.

Meanwhile, rival litigation filed by Earthjustice and other prominent environmental groups seeks to halt the lease sale. The organizations say the lease sale violates the National Environmental Policy. They say the administration failed to account for health threats to Gulf Coast communities near oil refineries and didn't adequately the effects of new fossil fuel development on the climate.

Energy industry representatives welcomed the ruling. "The injunction is a necessary and welcome response from the court to an unnecessary decision by the Biden administration," Erik Milito, President of the National Ocean Industries Association, said in an emailed news release. "The removal of millions of highly prospective acres and the imposition of excessive restrictions stemmed from a voluntary agreement with activist groups that circumvented the law, ignored science, and bypassed public input."

An Earthjustice attorney said the order blocks "baseline protections" to help protect the Rice's whale from extinction.

"These oil companies are looking at the full glass after one sip and calling it empty," the attorney, Steve Mashuda, said in an emailed statement.