March 18, 2021
The Impact of the Federal Leasing Moratorium
As a part of his climate change agenda, President Biden issued two executive orders (EOs) in January that temporarily halt leasing and drilling on federal lands and in federal waters until the Department of the Interior conducts a review. The results of the review are not clear yet, but these EOs signal a pivot toward a clean energy transition, which could impact employment and growth in the oil and gas industry. In a new analysis, AAF’s Director of Energy Policy Ewelina Czapla and Simran Borade examine the moratorium’s potential impact on federal leasing, oil production on federal lands, and employment.
Their central points:
- A relatively small percentage of total domestic oil and gas production occurs on land managed by the Department of Interior, but the majority of this production is concentrated in a few states;
- While the number of leases or drilling permits do not correlate with the total number of jobs in oil and natural gas industry, the market price of oil does serve as an indicator of the number of extraction jobs; and
- Should the moratorium on new drilling be implemented permanently, policies should target those states where potential future job losses would be most concentrated instead of applying to the entire country or industry.