Oct 6 (Reuters) – The U.S. Department of the Interior took the first steps on Thursday to hold oil and gas drilling auctions in New Mexico, Wyoming and the Gulf of Mexico in the coming months.
Terms for onshore sales will reflect new requirements of President Joe Biden’s new Climate Change and Drug Pricing Act, the Inflation Reduction Act (IRA), including royalty rates, and higher minimum rents, Interior said.
The Interior’s Bureau of Land Management said it was seeking public comment for 30 days on a plan to offer 251,086 acres in Wyoming and 10,124 acres in New Mexico to oil and gas companies.
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The IRA, which Biden signed into law in August, contains nearly $370 billion for climate change and clean energy initiatives such as solar and wind power incentives. But it also contains protections for the powerful oil and gas sector.
Biden promised during his 2020 election campaign to end federal oil and gas drilling to fight climate change, but faced pressure to increase fuel production in the face of soaring prices.
Interior said it will evaluate potential sales plots in other states in the coming weeks.
Separately, the Interior’s Bureau of Ocean Energy Management released a draft environmental review for two Gulf of Mexico drilling auctions scheduled to take place next year.
The analysis estimated that holding just one sale would lead to a slight drop in oil prices, which would increase global fuel demand and release an additional 46.8 million metric tons of carbon dioxide equivalent into the atmosphere. .
That’s equivalent to the emissions of about 10 million cars driven for a year, according to the US Environmental Protection Agency’s Greenhouse Gas Equivalents Calculator.
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Reporting by Nichola Groom; Editing by Alexander Smith
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