US President Joe Biden is expected to sign an executive order on Wednesday ordering federal government agencies to determine the extent of a ban on new drilling on federal lands and waters, reports The New York Times, with two sources familiar with the forthcoming executive orders of the president.
The move to order federal agencies to consider the scope of a ban takes President Biden’s 60-day moratorium on oil and gas permitting federal states and waters a step further.
Hours after taking office, President Biden’s government suspended oil and gas for 60 days on federal lands and waters, as part of a review of the previous government’s policies and pressure on green energy to fight climate change.
The move by President Biden has provoked strong reactions from the oil industry.
“Restricting development on federal lands and waters is nothing more than an ‘import more oil’ policy. The demand for energy will continue to rise – especially as the economy recovers – and we can choose to use energy here “Producing in the United States or relying on foreign countries, countries that are hostile to American interests,” said Mike Sommers, president and CEO of the American Petroleum Institute (API).
“We are ready to enter into discussions with the Biden government on ways to address America’s energy challenges, but the blockade of US energy will only harm local communities and hamper America’s economic recovery,” Sommers said. .
The largest U.S. oil producers working on federal land have years of drilling permits and do not expect much to change in the short to medium term. However, the small independent shale drillers are concerned, especially those who have a large portion of their operations from federal states, and some think the U.S. government’s ban on new federal leases could pose an ‘existential threat’ to their businesses.
Some states may also be affected far more than others – for example, in New Mexico, 65 percent of the state’s oil and gas production takes place on federal soil.
By Charles Kennedy for Oilprice.com
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