### Recent Federal Court Decisions Threaten US Gulf of Mexico Oil and Gas Operations
The American Petroleum Institute (API) has sounded the alarm over a recent federal court decision that could severely impact new and existing oil and natural gas exploration and production in the Gulf of Mexico (GoM). The court’s ruling has significant implications for the industry, potentially halting operations by December 20, 2024, unless a new biological opinion is issued by the National Marine Fisheries Service (NMFS).
On August 19, the U.S. District Court for the District of Maryland found that the NMFS’s biological opinion for oil and gas drilling in the GoM fails to adequately protect the endangered Rice’s whale. As a result, the biological opinion on Gulf of Mexico leasing is set to lapse on December 20, 2024, if a new opinion is not completed before then. NMFS has indicated it will likely take until early spring 2025 to finalize the new biological opinion.
The potential halt in operations would create a significant bureaucratic bottleneck that could significantly delay or prevent permits for routine, daily activities. This scenario could lead to an enormous influx of individual consultation requests for daily Gulf activities, diverting valuable agency time and hindering NMFS’s ability to finalize a new biological opinion.
The impact of this court decision would be profound. The U.S. Gulf of Mexico accounts for 15% of the country’s total crude oil production, approximately 2 million barrels per day. This region also contributes significantly to natural gas production, making it a crucial component of the nation’s energy matrix. If production were to be halted, it could lead to an increase in carbon-intensity barrels from other parts of the world, exacerbating environmental concerns.
Beyond the economic implications, the disruption would also have far-reaching consequences for the region’s economy. The offshore oil and gas industry supports over 412,000 jobs and contributes more than $34.3 billion annually to the