Trump to Push Offshore Oil Expansion to After 2020 Election, Sources Say

(Bloomberg) -- The Trump administration is delaying its bid to expand oil drilling to new U.S. waters until after the 2020 election in response to opposition from coastal Republicans and a legal defeat, according to two people briefed on the matter.

Administration officials are worried that the president and Republican leaders in the southeast U.S. would lose votes if they pushed forward with the plan to sell new drilling rights in the Atlantic, Arctic and Pacific oceans, said the people, who asked not to be identified revealing confidential discussions. Procedural missteps and a court ruling jeopardizing new oil drilling opportunities in Arctic waters also complicated the effort.

Interior Secretary David Bernhardt last month told senators that the administration was back “at the very beginning” of the long process of writing a new five-year plan for selling offshore oil and gas leases.

Bernhardt’s remark was a defeat for oil companies eager for new offshore acreage and represents the latest snag in a tortured two-year bid by the Trump administration to expand coastal waters available for drilling.

President Donald Trump in 2017 ordered the Interior Department to consider scheduling new sales of drilling rights along U.S. coastlines, with an eye on annual auctions of territory in the western and central Gulf of Mexico, the Chukchi and Beaufort seas north of Alaska, and the mid- and south-Atlantic.

The agency responded in January 2018 with a draft plan opening the door to selling drilling rights in more than 90 percent of U.S. coastal waters.

In the court ruling March 29, an Alaska-based judge found Trump exceeded his legal authority in trying to resume oil and gas leasing in more than 125 million acres (50.6 million hectares) of the Arctic and Atlantic oceans that former President Barack Obama had sought to protect. Legal appeals could stretch until at least 2020, interfering with the Interior Department’s initial bid to sell drilling rights in the Beaufort Sea this year.

“Given the recent court decision, the department is simply evaluating all of its options to determine the best pathway to accomplish the mission entrusted to it by the president,” Interior spokeswoman Molly Block said by email.

‘Discombobulating’

In an interview Thursday with the Wall Street Journal, Bernhardt said the Interior Department may be forced to wait for potentially lengthy appeals of that case before making a final decision on the offshore oil plan.

“By the time the court rules, that may be discombobulating to our plan,” Bernhardt told the newspaper.

Even before the court ruling, the department had struggled to take the next step: unveiling a formal proposed schedule for selling offshore oil leases through at least 2024. The effort was complicated by political concerns, after former Interior Secretary Ryan Zinke publicly assured Florida’s then-governor, Republican Senator Rick Scott, that he was “removing Florida from consideration for any new oil and gas platforms.”

Governors along the U.S. East Coast cried foul, demanding similar protections, as coastal communities and city councils passed resolutions objecting to offshore drilling near their shores.

The Republican-led Georgia House of Representatives passed a resolution opposing offshore drilling earlier this month. And South Carolina joined a lawsuit challenging the Trump administration over planned seismic surveys designed to pinpoint possible oil along the U.S. East Coast, with the support of the state’s Republican governor and attorney general.

Democrats also have capitalized on opposition to offshore drilling in campaigns for office. For instance, freshman Representative Joe Cunningham, a Democrat from South Carolina, made offshore drilling a signature issue in his successful bid for the House last year.

The issue also squeezes some Republican lawmakers seeking re-election, including Senator Thom Tillis of North Carolina, who has pushed the Trump administration for more details on how it will protect coastal communities.

“Bipartisan opposition to offshore drilling from a growing number of local, state and federal officials across America has made this a political loser for President Trump, and he knows it,” said Kevin Curtis, executive director of the NRDC Action Fund, an affiliate of the Natural Resources Defense Council. “Every candidate for federal office in 2020 will be asked whether they stand with Trump and the oil companies or with the families, business owners, and local officials who oppose the expansion of dirty, dangerous and climate-wrecking drilling off our beaches.”

Some of that political pressure could be diffused by the Trump administration’s decision to delay further formal steps to advance a new offshore leasing plan. The Interior Department’s Bureau of Ocean Energy Management can continue to do environmental analysis on possible offshore sales in the meantime.

Environmentalists called on the Trump administration to go further and rule out new offshore drilling altogether.

“We may have generated enough opposition to slow this down, but until the Trump plan is final, the president is positioned to open up our coasts at a moment’s notice,” said Jacqueline Savitz, chief policy officer at the conservation group Oceana.

Zinke’s promise to Florida jeopardized lease sales in one of the most attractive untapped U.S. offshore areas for oil companies. They have been eager to buy drilling rights in eastern Gulf of Mexico waters roughly 100 to 150 miles away from Florida’s west coast, following promising discoveries in nearby territory.

“The eastern Gulf is important to us,” American Petroleum Institute President Mike Sommers said in an interview earlier this month. “It’s a prolific basin, and it’s where we’ve had a lot of success.”

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