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THE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & LifestyleTHE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & Lifestyle

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US auctions oil and gas drilling rights for first time since Biden’s IRA.

An oil pumpjack is pictured in the Permian basin, Loco Hills regions, New Mexico, U.S., April 6, 202... An oil pumpjack is pictured in the Permian basin, Loco Hills regions, New Mexico, U.S., April 6, 2023. REUTERS/Liz Hampton
An oil pumpjack is pictured in the Permian basin, Loco Hills regions, New Mexico, U.S., April 6, 202... An oil pumpjack is pictured in the Permian basin, Loco Hills regions, New Mexico, U.S., April 6, 2023. REUTERS/Liz Hampton

On Thursday, the U.S. will sell oil and gas drilling rights on federal lands in New Mexico and Kansas, more than 10,000 acres (40.5 square kilometers).

Since Biden became president in 2021, New Mexico, the nation’s second-largest oil producer, has staged only two federal lease auctions.
Last year’s Inflation Reduction Act requires some oil and gas auctions if federal rights of way are provided for renewable energy projects, despite Biden’s Interior Department’s attempt to freeze federal leasing to evaluate its environmental and climate consequences.

By historical standards, the sale of 19 blocks on 3,300 acres in New Mexico’s Permian basin is small. However, Cheyenne County, Kansas, will sell 26 parcels on 6,800 acres.

Last year, New Mexico produced 20 times more crude oil than Kansas.
EnergyNet will start the auction at 9:00 am CDT (1400 GMT).

The sale will reflect new IRA criteria, including royalty rates of 16.67%, up from 12.5%, and bids starting at $10 an acre, up from $2 under the law.

According to a BLM auction document, Kansas parcels have 1.53 million barrels of oil and 16.66 thousand cubic feet (mcf) of natural gas production potential.

New Mexico is expected to generate 3.2 million barrels of oil and 18.61 mcf of gas.

Environmental groups petitioned BLM to cancel the transaction. They also alleged the Biden administration failed to assess mitigating options to reduce greenhouse gas emissions from parcel development.


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