Trump administration rushes sale of California oil leases despite certain legal battle

The Trump administration on Thursday plans to hold the first oil lease sale in California in eight years, part of a last-minute rush to auction off as much federal land as possible before President-elect Joe Biden is sworn in.

The Bureau of Land Management said the sale would encompass just over 4,100 acres of federal land and mineral estate in Kern County, where the majority of drilling in the state takes place. The agency estimates that as many as 10 new wells could be drilled on the land for sale.

But even if the administration succeeds in auctioning off the leases, any attempts at new oil and gas development are likely to face significant opposition in the courts and from the incoming Biden administration.

During the campaign, Biden said he would transition the country away from oil and gas as part of a vow to address climate change by reducing greenhouse gas emissions. He promised to ban new drilling on federal land, a pledge that the Trump campaign tried but failed to use against him.

“All the new leasing the Trump administration has been trying to push through is fundamentally incompatible with meeting our climate goals,” said Kassie Siegel, director of the Center for Biological Diversity’s Climate Law Institute. “The Biden administration can and should move very quickly to revoke these leases.”

Under Biden, the Bureau of Land Management could justify cancellation of the leases by finding that they were “improperly issued” and in violation of environmental laws and regulations. It could do this even months after the leases are sold, though the longer the government waits to act, the more expensive it can be to buy out the lessees.

If the administration can’t cancel the leases for some reason, environmental groups are ready to sue.

California Gov. Gavin Newsom, Atty. Gen. Xavier Becerra and the state’s top clean air regulator have come out against the lease sale, all but ensuring that California will also mount a legal challenge.

Federal courts have repeatedly ordered the government to suspend or void hundreds of leases issued by the Trump administration, finding that it made procedural mistakes and trampled over environmental laws in its haste to increase domestic oil and gas production. Last month, U.S. District Judge Rudolph Contreras blocked drilling on more than 300,000 acres in Wyoming and rebuked the administration for a “sloppy and rushed process” that failed to take into account the climate change effects of widespread oil and gas drilling.

The administration has significantly dialed back its ambitions in California from where it began in 2019, when the Bureau of Land Management announced plans to open more than a million acres in the state to oil extraction by hydraulic fracturing, or fracking.

The backlash was swift. California and environmental groups filed lawsuits against the proposal, warning that it would worsen air quality in some of the state’s smoggiest regions. Advocates for national parks said it would allow drilling near wilderness areas.

To Athan Manuel, director of lands protection at the Sierra Club, the administration’s initial proposal seemed more like a political jab at California than a serious plan. Oil companies were clamoring to drill in the Dakotas and the Permian Basin in Texas and New Mexico, he said, but the industry’s interest in California was waning.

“When they first announced a potential million-acre lease sale in California, it just sounded like they hadn’t actually done their homework,” Manuel said.

The agency scaled back its offering, but it remains unclear how much interest drilling in Kern County will attract from oil companies.

Although it will be the first time the BLM has auctioned off oil leases in the state since 2012, any pent-up demand could be erased by the undesirability of entangling oneself in a dispute with the next administration. Fossil fuel companies that buy leases in the final months of the Trump administration could wind up with stranded assets that they can’t develop.

Yet the administration is pushing forward.

Serena Baker, a spokeswoman for the BLM in California, said the agency is finalizing its environmental review. Bidding is set to begin Thursday morning.

As to the likelihood that any leases sold would be overturned, Baker wrote: “America’s free markets will help determine if energy development on public lands is feasible.”