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The sale of oil and gas drilling rights in the Arctic National Wildlife Refuge (ANWR) was supposed to bring in upwards of $1 billion, but in the end, the first of the auctions mandated by Congress at the urging of President Trump brought in only $14M— a pittance of the projection and of the amount bid for offshore wind rights. Moreover, the winning bidder in almost every case was none other than the state of Alaska itself.
But, but, but — the Associated Press reports that in the western U.S., energy companies have bought up enough drilling permits on western public lands to keep pumping out oil and gas for years.
Why This Matters: Banks won’t underwrite Arctic drilling, so it is unclear those ANWR leases will be drilled ever. But the leases in the Trump leasing bonanza in the lower 48 could put a serious dent in President-elect Joe Biden’s plans to curb new drilling because of climate change.
ANWR Drilling Dreams Face New Reality
Arctic drilling is no longer feasible — in the U.S. or anywhere other than perhaps Russia. In the last year, many major banks have refused to provide financial backing and public support for the projects has diminished since Congress mandated the sale in the 2017 tax cut bill. One more sale is required by 2022. This is the first time a state has bought the leasing rights for oil and gas. “To my knowledge, this has never happened before, that a state bids on federal leases within their own state,” Jenny Rowland-Shea, a senior public lands policy analyst at the Center for American Progress told The Hill. The sale brought in only $14.4 million dollars, roughly $27 per acre, prompting Congressman Jared Huffman to argue on Twitter that “Trump is giving away treasured land in the Arctic Refuge at rock bottom prices in today’s oil/gas lease sale,” calling the sale a human right violation for the Gwich’in tribe for whom the area is sacred.
Lower 48 Sees Rapid Lease Sales Increase Last Fall
The Associated Press (AP) analyzed government data about recent lease sales and found that oil and gas companies have been stockpiling leases on the oil-rich federal lands in New Mexico and Wyoming. And as President-elect Biden increased his lead over President Donald Trump during the fall the sales increased greatly, peaking in December, aided by all the Trump administration rules making the speeding permitting approvals. The numbers are huge. The AP’s analysis shows that the Bureau of Land Management officials approved almost 1,400 drilling applications during the fall, amidst the pandemic, which is the largest number of approvals during Trump’s four-year term. To stop the drilling, the government would have to spend tens of millions essentially buy the permits back, according to a former senior Interior Department official. It might take years to get them to sell — the government just finished buying the last of numerous permits in pristine areas of Montana, where officials spent decades trying to buy out companies with drilling leases near Glacier National Park.
Wind power has overtaken coal as a proportion of Texas’s power for the first time and promises to continue growing. In 2020, wind power made up almost a quarter of Texas’s total power, compared to just 18% from coal.
Why This Matters: Texas is the nation’s largest producer of both wind energy and fossil fuel energy.
When 2020 began, even with oil prices relatively strong, many industry analysts were predicting it was the beginning of the end for oil and gas. And then the pandemic hit and the Saudis and Russians decided to take advantage of the downturn. With supplies still high and demand declining, the industry may never be the same again.
As we grapple with the disastrous pandemic, recession, and climate change, the nation is in desperate need of investment in clean energy to reduce climate pollution and jumpstart the economy. The Energy Act of 2020, included with the COVID-19 relief and 2021 spending package, will help the United States on both fronts by investing in a spectrum of technologies.
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