API: Final five-year offshore program is ‘step in wrong direction’ for U.S. energy security

World Oil Staff December 15, 2023

(WO) — The American Petroleum Institute (API) released the following statement on Dec. 15 from the Vice President of Upstream Policy Holly Hopkins on the Biden administration’s approval of a five-year program for federal offshore leasing.

“Simply put, this final five-year program fails to meet the energy needs of the American people and could threaten to increase reliance on foreign energy sources. Demand for affordable, reliable energy is only growing, yet the administration is choosing to limit future production in a region that plays a critical role in powering our nation and supplies among the lowest carbon-intensive barrels in the world. This program is a step in the wrong direction for U.S. energy security and will only make it harder to meet growing energy demand over the long-term.”

For 45 years, the Interior Department has been required to prepare a five-year offshore leasing program that will best meet America’s energy needs for the ensuing five-year period, detailing a schedule for regular oil and natural gas lease sales, including in the Gulf of Mexico. The U.S. Department of the Interior released the final five-year program for federal offshore leasing in September, but the program is required to be reviewed by Congress for 60 days before it is finalized.

Interior’s final five-year program was nearly 500 days late and outlines a maximum of three potential oil and gas lease sales – the fewest oil and gas lease sales in history – in the Gulf of Mexico Program Area scheduled in 2025, 2027 and 2029. 2024 will be the first year since 1966 without an offshore lease sale.

According to the U.S. EIA, Gulf of Mexico federal offshore oil production accounts for 15% of total U.S. crude oil production and federal offshore natural gas production in the Gulf accounts for 5% of total U.S. dry production. A recent report from NOIA conducted by ICF found that the U.S. Gulf of Mexico produces some of the lowest carbon intensity barrels in the world. Constrained production in this basin could be replaced by higher carbon intensity barrels from elsewhere in the world.

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