Litigation causes US to pause Gulf of Mexico oil and gas auction

The US has postponed a planned November 8th sale of offshore drilling rights in the Gulf of Mexico, pending the outcome of a lawsuit over oil and gas development and federal protection of an endangered species of whale.

On October 26th a US appeals court temporarily paused a lower court order requiring the Interior Department’s US Bureau of Ocean Energy Management (BOEM) to expand the auction, which was originally scheduled to be held in September. Oral arguments are scheduled for November 13th in New Orleans.

“Until the court rules, BOEM cannot be certain of which areas or stipulations may be included in the sale notice,” the bureau said.

The pause stems from a state vs federal government dispute. The oil and gas industry and the state of Louisiana had sued the Interior Department in August over its decision to scale back the auction in order to reduce conflicts with Rice’s whale habitat.

Oil industry trade group American Petroleum Institute (API) is a plaintiff in the lawsuit, and criticized the postponement. Holly Hopkins, vice president of upstream policy at API, said that “the Department of the Interior continues to demonstrate its willingness to ignore the clear and growing need to expand American energy leadership and reduce reliance on foreign energy sources”.