The Biden administration’s 60-day pause on new oil and natural gas leases and drilling permits on federal land, signed by Acting Interior Secretary Scott de la Vega late Wednesday, could result in devastating consequences to state economies that rely on proceeds from oil sales.
The order, which appeased progressive environmentalist groups, has significant immediate effects.
From the Associated Press:
Industry groups said the order effectively brings all regulatory activity to a halt, from routine requests that arise during the normal course of business to requests for rights of way for new pipelines designed to gather more natural gas as part of efforts to reduce venting and flaring — practices that Democrats have targeted in their fight against climate change.
What about the economic impact?
Leaders in New Mexico say the impact of making permanent the temporary moratorium would be “economically devastating.”
New Mexico is one of the top oil-producers in the nation — third behind Texas and North Dakota, thanks, in part, to the Permian Basin — yet it is also one the most-impoverished states in the U.S., leaving the Land of Enchantment more economically vulnerable to what one local leader called “knee-jerk” decisions by President Joe Biden’s Cabinet.
“During his inauguration, President Biden spoke about bringing our nation together. Eliminating drilling on public lands will cost thousands of New Mexicans their jobs and destroy what’s left of our state’s economy,” Carlsbad Mayor Dale Janway told the Associated Press.
“How does that bring us together?” Janway added. “Environmental efforts should be fair and well-researched, not knee-jerk mandates that just hurt an already impoverished state.”
The Biden administration’s order has New Mexican leaders concerned, in particular, because about half of their oil production occurs on federal lands, producing hundreds of millions of dollars in royalty revenue each year, the AP noted.
New Mexico Republican Party chairman Steve Pearce voiced another significant concern. He fears that the Biden administration’s order could be a job killer.
“I think we’re going to see companies choosing not to invest in New Mexico and take their jobs and drilling to Texas just 3 miles away,” Pearce said, the AP reported. “They can just scoot across the border where they don’t have federal lands.”
New Mexicans, ironically, supported Biden over now-former President Donald Trump in the 2020 presidential contest by a significant margin — 54.3% to 43.5%, or 100,000 votes.