US Interior Department cancels Gulf of Mexico, Alaska oil and gas lease sales

The US Department of the Interior last week cancelled three oil and gas lease auctions, two in the Gulf of Mexico (lease sales 259 and 261), one offshore Alaska in Cook Inlet (lease sale 258).

Erik Milito, president of the US National Ocean Industries Association, called the decision “devastating to Americans,” saying that “restricting American energy development will quite simply lead to reduced American supplies, higher prices, lost investment, destruction of high-paying jobs throughout the country, harmful geopolitical consequences, and a reversion to dependency on foreign suppliers.”

The White House has emphasised, however, that the sale cancellation will be inconsequential, given the current state of US offshore production. Press Secretary Jen Psaki said in briefings that, “of the more than 10.9m offshore acres currently under lease, industry is not producing on 8.26m acres. That’s more than 75% that is non-producing.

“The issue is not permits,” she said. “There are plenty of places for oil companies to drill on. They’re not. That is the issue.”

Psaki also said: “What they [the Department of the Interior] have made quite clear is that the Cook Inlet cancellation … was due to a lack of industry interest. And the Gulf sales were as a result of delays due to a number of factors, including conflicting court rulings.”

She noted that “US production is expected to increase by over 1m barrels a day this year and hit a new record next year.”

Kim Biggar

Kim Biggar started writing in the supply chain sector in 2000, when she joined the Canadian Association of Supply Chain & Logistics Management. In 2004/2005, she was project manager for the Government of Canada-funded Canadian Logistics Skills Committee, which led to her 13-year role as communications manager of the Canadian Supply Chain Sector Council. A longtime freelance writer, Kim has contributed to publications including The Forwarder, 3PL Americas, The Shipper Advocate and Supply Chain Canada.
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