President Donald Trump's administration is pushing out approvals of major oil and gas projects in Alaska and Wyoming that could make it more difficult for Democratic presidential nominee Joe Biden to deliver on promises to "ban" new permits on federal land if he is elected.
The administration this week finalized plans to allow oil leasing in the Arctic National Wildlife Refuge (ANWR). Over the past month it advanced two projects in Wyoming that envision drilling 9,250 wells, one of which is expected to produce 1.4bn bl of crude over 30 years. Other decisions expected later this year are set to open 7mn acres of land in the National Petroleum Reserve in Alaska (NPR-A) to leasing and approve US independent ConocoPhillips' proposed 160,000 b/d Willow project in the reserve.
Those decisions could give operators a foothold to develop on vast tracts of federal land that are expected to support decades of production. And they would create new obstacles if a potential Biden administration attempts to deliver on a campaign promise to curtail drilling on federal lands, since leases offer companies legal rights that are difficult to revoke.
Biden has promised to ban "new" oil and gas permitting on federal land and said he is "totally opposed" to drilling in ANWR. It remains unclear how such a permitting ban would work in practice, since refusing to process permits outright could run afoul of existing laws and contractual rights. Industry officials expect that a Biden administration would attempt to create a de facto ban by dragging out the permitting process with new requirements and climate reviews.
"A president does not have the ability to just say ‘We are not going to approve any more permits on federal land,'" Western Energy Alliance president Kathleen Sgamma said. "There is slow-walking, there is foot-dragging, there are 1,000 ways they can make things take longer."
Oil and gas companies with large positions on federal land have downplayed the risks under a Biden administration. ConocoPhillips chief executive Ryan Lance last month said the company's position in NPR-A was "pretty safe" because its land there was already leased, although he conceded the possibility that permitting could be "dragged out." The company expects to receive all federal permits for its Willow project later this year.
Other companies say a backlog of drilling permits they have built up could sustain their development plans. US independent Concho Resources says it has built up enough permits on its federal holdings in New Mexico to support 1-2 years of drilling. US independent Devon Energy president David Hager says permits it already holds could sustain 75pc of planned drilling over the next four years on federal land in Wyoming and New Mexico.
Critics say the oil industry should not count on decisions from the Trump administration holding up over the long term, even if Biden does not win the upcoming election on 3 November. US courts have repeatedly thrown out earlier attempts by Trump's administration to expand drilling, after finding fast-track reviews were missing key reviews.
"No administration is above the law," Wilderness Society Action Fund interim deputy vice president Chase Huntley said. "Any of the decisions this administration is seeking to lock in place are subject to judicial review, and in many cases subject to the policy objectives of a new administration."
