Overnight Energy: Trump officials open California to new oil, gas drilling | Trump sides with farmers on ethanol | Perry reportedly looking to leave Energy Department

DRILL BABY DRILL: The Trump administration Friday announced it would make 725,000 acres in California’s central coast open to oil and gas lease sales, ending a five-year moratorium.

The decision by the Bureau of Land Management (BLM) makes land available for fossil fuel production across Fresno, Monterey, San Benito and other counties for the first time in half a decade.

Soon, fossil fuel companies will be able to request and bid on plots within the hundreds of thousands of acres of public lands and on mineral estates across 11 counties.

The BLM said the decision is in line with President Trump’s May 2017 executive order for promoting U.S. energy independence.

{mosads}The BLM estimates that oil and gas production on private and public lands would directly support nearly 3,000 jobs and establish $670 million in tax revenue. California will get 50 percent of the royalty fees incurred from the project.

In addition, the ruling authorizes potential oil and gas development in 14 areas previously litigated across Monterey and San Benito counties. Those areas would be subject to controlled surface use stipulations. The plan estimates that up to 32 new oil and gas development wells could be built on the federal lands during the plan’s lifetime.

Background: No federal lease sales have occurred in California since 2013, when a court ruled BLM failed to consider the risks of fracking when it issued oil leases in Monterey and Fresno. The agency has since then conducted and filed new environmental impact studies on drilling in the area.

What’s next? At least one environmental group harshly criticized the administration’s decision and threatened to take legal action.

Read more on the decision.

 

TGIF! Welcome to Overnight Energy, The Hill’s roundup of the latest energy and environment news. 

Please send tips and comments to Miranda Green, mgreen@digital-stage.thehill.com and Rebecca Beitsch, rbeitsch@digital-stage.thehill.com. Follow us on Twitter: @mirandacgreen, @rebeccabeitsch and @thehill.

CLICK HERE to subscribe to our newsletter.

 

ETHA-NOT THE LAST WE’VE HEARD OF THIS: The Trump administration unveiled a fuel proposal Friday that would buoy corn farmers and ethanol producers to the detriment of the nation’s oil industry.

The proposal from the Environmental Protection Agency (EPA) would require oil refineries to blend more ethanol into gasoline, while also paving the way for year-round “E15” fuels that are blended with 15 percent ethanol. 

The proposal from the EPA would require refineries starting next year to blend a minimum of 15 billion gallons of ethanol into fuel, one of the escalating targets laid out in current law that has never been met. 

The rollout marks the latest twist in a months-long feud between two groups viewed by President Trump as key supporters in his base: farmers and the oil and gas industry.

“Once again the president has demonstrated he’s a champion for our nation’s farmers and for rural America,” a senior EPA official said Friday on a call with reporters, characterizing attempts to please both farmers and the oil industry as a “difficult issue.”

The concessions in the proposal go beyond what farmers had asked of the president but omit one key component — there is no requirement to blend ethanol produced this year that was set aside when Trump exempted 31 small refineries from adding ethanol to their fuel product.

The decision to issue those waivers in August, following a promise by Trump to reevaluate the program, sparked backlash from corn farmers who had already been hit hard by Trump’s trade war with China.

Farm groups have been putting steady pressure on the White House for months to revise the program, and Friday’s announcement largely appeased them.

“Corn farmers weren’t shy in telling the President that the impact of these waivers would lead to significant consequences for farmers, folks working at ethanol and biodiesel plants, and the countless other rural jobs that depend on this market. The President is finally telling the EPA that enough is enough, they must follow the law, and we appreciate that,” Kevin Ross, president of the National Corn Growers Association, said in a statement.

Sen. Joni Ernst (R-Iowa) was among the lawmakers from corn-producing states who issued statements Friday praising the proposal.

But the oil industry appeared just as unhappy as farmers were elated. “Let’s not sugar coat it, ethanol mandates are being raised because a handful of corn-state senators have extorted it from the president using election year politics,” LeAnn Johnson with the Small Refiners Coalition said in a statement.

Both the American Petroleum Institute (API), the lobby for the oil industry, and the American Fuel & Petrochemical Manufacturers, which represents oil refineries, called the proposal concerning, vowing to challenge the policy because “it is by no means a win-win.”

Read more here. 

 

PERRY ON HIS MERRY WAY? Energy Secretary Rick Perry is expected to announce his resignation next month, Politico reported Thursday night.

Three sources close to Perry told the newspaper that the Energy secretary was planning an announcement in November. 

The report of Perry’s expected resignation comes days after the top Democrat on the Senate Foreign Relations Committee sent questions to Perry related to his travel to Ukraine amid scrutiny of the Trump administration’s dealings with the country.

The Energy secretary traveled to Ukraine in May for the inauguration of the country’s new president, Volodymyr Zelesnky, whose contacts with President Trump are now at the center of House Democrats’ impeachment inquiry.

Sources close to Perry claimed to Politico that his resignation would be unrelated to scrutiny over Trump’s dealings with Ukraine. 

Deputy Energy Secretary Dan Brouillette is expected to lead the department as Perry’s replacement, the three sources told Politico.

A spokeswoman for the Energy Department declined to say if Perry would resign next month, instead rebuking the media for past reports about Perry’s expected departure.

Read more here.

 

OUTSIDE THE BELTWAY: 

-Oil boom makes Texas-New Mexico border the most dangerous, the Houston Chronicle reports.

-Idaho moves full steam ahead on helping to manage some federal lands, the Idaho Statesman reports.

-Florida moving forward with putting power lines underground to battle hurricane damage, News Service of Florida reports.

 

ICYMI: Stories from Friday…

-Trump administration ends five-year oil and gas drilling moratorium in California 

-Trump sides with farmers in ethanol proposal, angering oil industry

-Women who vandalized Dakota Access pipeline charged on 9 counts

-Energy Secretary Rick Perry expected to resign next month: report

-Lawmaker, scientists challenge Trump officials’ push to disband two key advisory boards