Trump administration announces gas, oil lease plans
U.S. Secretary of the Interior Ryan Zinke today announced the next step for developing the National Outer Continental Shelf Oil and Gas Leasing Program (National OCS Program) for 2019-2024, which proposes to make over 90 percent of the total OCS acreage and more than 98 percent of undiscovered, technically recoverable oil and gas resources in federal offshore areas available to consider for future exploration and development.
By comparison, the current program puts 94 percent of the OCS off limits. In addition, the program proposes the largest number of lease sales in U.S. history.
“Responsibly developing our energy resources on the Outer Continental Shelf in a safe and well-regulated way is important to our economy and energy security, and it provides billions of dollars to fund the conservation of our coastlines, public lands and parks,” said Secretary of the Interior Ryan Zinke. “Today’s announcement lays out the options that are on the table and starts a lengthy and robust public comment period. Just like with mining, not all areas are appropriate for offshore drilling, and we will take that into consideration in the coming weeks. The important thing is we strike the right balance to protect our coasts and people while still powering America and achieving American Energy Dominance”
Earlier this year, 155 Members of both the U.S. House and U.S. Senate sent letters to Secretary Zinke in support of a new 5-year plan that recognizes America’s potential for energy dominance.
The Draft Proposed Program (DPP) includes 47 potential lease sales in 25 of the 26 planning areas – 19 sales off the coast of Alaska, 7 in the Pacific Region, 12 in the Gulf of Mexico, and 9 in the Atlantic Region. This is the largest number of lease sales ever proposed for the National OCS Program’s 5-year lease schedule.
“By proposing to open up nearly the entire OCS for potential oil and gas exploration, the United States can advance the goal of moving from aspiring for energy independence to attaining energy dominance,” said Vincent DeVito, Counselor for Energy Policy at Interior. “This decision could bring unprecedented access to America’s extensive offshore oil and gas resources and allows us to better compete with other oil-rich nations.”
Release of the DPP is an early step in a multi-year process to develop a final National OCS Program for 2019-2024. Today’s draft proposal was informed by approximately 816,000 comments from a wide variety of stakeholders, including state governments, federal agencies, public interest groups, industry, and the public. Before the program is finalized, the public will have additional opportunities to provide input. The 2017-2022 Five Year Program will continue to be implemented until the new National OCS Program is approved.
“This plan is an early signal to the global marketplace that the United States intends to remain a global leader in responsible offshore energy development and produce affordable American energy for many decades to come,” said Katharine MacGregor, Principal Deputy Assistant Secretary for Land and Minerals Management. “This proposed plan shows our commitment to a vibrant offshore energy economy that supports the thousands of men and women working in the offshore energy industry, from supply vessels to rig crews.”
Inclusion of an area in the DPP is not a final indication that it will be included in the approved Program or offered in a lease sale, because many decision points still remain. By proposing to open these areas for consideration, the Secretary ensures that he will receive public input and analysis on all of the available OCS to better inform future decisions on the National OCS Program. Prior to any individual lease sale in the future, BOEM will continue to incorporate new scientific information and stakeholder feedback in its reviews to further refine the geographic scope of the lease areas.
“American energy production can be competitive while remaining safe and environmentally sound,” said Acting BOEM Director Walter Cruickshank. “Public input is a crucial part of this process, and we hope to hear from industry groups, elected officials, other government agencies, concerned citizens and others as we move forward with developing the 2019-2024 National OCS Program.”
The Outer Continental Shelf Lands Act requires the Secretary of the Interior, through BOEM, to prepare and maintain a schedule of proposed oil and gas lease sales in federal waters, indicating the size, timing, and location of leasing activity that would best meet national energy needs for the five-year period following Program approval. In developing the National OCS Program, the Secretary is required to achieve an appropriate balance among the potential for environmental impacts, for discovery of oil and gas, and for adverse effects on the coastal zone.
BOEM currently manages about 2,900 active OCS leases, covering almost 15.3 million acres – the vast majority in the Gulf of Mexico. In fiscal year 2016, oil and gas leases on the OCS accounted for approximately 18 percent of domestic oil production and 4 percent of domestic natural gas production. This production generates billions of dollars in revenue for state and local governments and the U.S. taxpayer, while supporting hundreds of thousands of jobs.
Gulf of Mexico
The DPP includes 12 sales in the Gulf of Mexico, one of the most productive basins in the world and where oil and gas infrastructure is well established. The draft proposal continues the current approach to lease sales in the Gulf of Mexico by proposing 10 biannual lease sales in those areas of the Western, Central, and Eastern Gulf of Mexico that are not subject to Congressional moratorium or otherwise unavailable, and two sales in the portions of the Eastern and Central Gulf of Mexico after the expiration of the Congressional moratorium in 2022. This is the first time the majority of the Eastern GOM Planning Area would be available for leasing since 1988.
The DPP proposes 19 lease sales in the Alaska Region (3 in the Chukchi Sea, 3 in the Beaufort Sea, 2 in Cook Inlet, and 1 sale each in 11 other program areas in Alaska). These 11 program areas consist of the Gulf of Alaska, Kodiak, Shumagin, Aleutian Arc, St. George Basin, Bowers Basin, Aleutian Basin, Navarin Basin, St. Matthew-Hall, Norton Basin, and Hope Basin. No sales are proposed in the North Aleutian Basin Planning Area that has been under Presidential withdrawal since December 2014.
The DPP proposes 7 lease sales in the Pacific Region (2 each for Northern California, Central California, and Southern California, and 1 for Washington/Oregon). There have been no sales in the Pacific Region since 1984. Currently there are 43 leases in producing status in the Southern California Planning Area.
The DPP proposes 9 lease sales in the Atlantic Region (3 sales each for the Mid- and South Atlantic, 2 for the North Atlantic, and 1 for the Straits of Florida). There have been no sales in the Atlantic since 1983 and there are no existing leases.