During his first week in office, President Joe Biden ordered the Department of the Interior to start the process of prohibiting any new or renewed oil and gas drilling leases on federal lands.
In June 2021, a district judge in Louisiana issued a temporary injunction on the executive order, writing, “A president’s authority to act, as with the exercise of any governmental power, must stem either from an act of Congress, or from the Constitution itself, or a combination of the two.”
But the U.S. Fifth Circuit Court of Appeals vacated the lower court’s ruling on Tuesday, stating in its own opinion that the lower court failed to adequately define the “pause” issued by the federal government.
“We cannot reach the merits of the Government’s challenge when we cannot ascertain from the record what conduct—an unwritten agency policy, a written policy outside of the Executive Order, or the Executive Order itself— is enjoined,” the court ruled.
The case was then remanded back to the lower court to fix the discrepancy identified by the appeals court.
The original order was issued in accordance with the Biden administration’s priority to reduce the nation’s reliance on oil and gas. Broadly, its metric is to reduce U.S. emissions 40 percent below 2005 levels by 2030 — a target the U.S. had already halfway met by the time Biden took office — and to reach net-zero emissions status by 2050.
While the proportion of federal lands in Texas is relatively low compared with other states like its neighbor New Mexico, the American Petroleum Administration estimated the pause would result in 120,000 fewer oil and gas jobs in the Lone Star State. Fossil fuels mined on federal lands account for 22 percent of the nation’s oil supply and 14 percent of gas.
The policy is one of multiple postures the Biden administration has taken to discourage growth in the oil and gas industry. A survey of industry executives by the Dallas Federal Reserve found federal regulations and posture to be among the top factors discouraging investment into the industry.
Both Texas and U.S. oil and gas production are lower than before the pandemic.
Notably, the circuit court did not rule on the merits of the executive order or the lawsuit challenging it. The ball is now back in the district judge’s court where it will stay until another ruling is issued addressing the Fifth Circuit’s concerns.
In the meantime, the game of regulatory chicken between the federal government and the oil and gas industry will continue.
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Brad Johnson
Brad Johnson is a senior reporter for The Texan and an Ohio native who graduated from the University of Cincinnati in 2017. He is an avid sports fan who most enjoys watching his favorite teams continue their title drought throughout his cognizant lifetime. In his free time, you may find Brad quoting Monty Python productions and trying to calculate the airspeed velocity of an unladen swallow.
