US President Joe Biden is expected to sign an executive order on Wednesday directing federal government agencies to determine the extent of a ban on new drilling on federal land and waters, The New York Times reports, citing two sources familiar with the upcoming executive orders from the president.
The move to order federal agencies to weigh in on the scope of a ban takes President Biden’s 60-day moratorium on oil and gas permits for federal lands and waters a step further.
Hours after taking office, President Biden’s government suspended oil and gas permits on federal lands and waters for 60 days, as part of a review of the previous government’s policies and push for green energy to combat climate change.
President Biden’s decision provoked harsh reactions from the oil industry.
Limiting development on federal lands and waters is nothing more than an ‘import more oil’ policy. Demand for energy will continue to rise – especially as the economy recovers – and we can choose to use that energy here in the United States. States to produce or rely on foreign countries that are hostile to US interests, ” said Mike Sommers, president and CEO of the American Petroleum Institute (API).
“We are ready to engage with the Biden administration on ways to address America’s energy challenges, but hindering American energy will only harm local communities and hinder America’s economic recovery,” Sommers remarked.
The largest US oil producers operating on federal land have drilling permits for years and do not expect much to change in the short to medium term. The small independent shale drilling machines, especially those that source much of their business from federal states, are concerned, and some believe the US government banning new federal lease sales could pose an “existential threat” to their businesses.
Some states could also be affected much more than others – in New Mexico, for example, 65 percent of the state’s oil and gas production takes place on federal land.
By Charles Kennedy for Oilprice.com
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