The Interior Department yesterday abruptly canceled a massive sale of offshore oil and gas leases in the North Atlantic, hours after a federal judge temporarily blocked it and the department discovered that only the environmental group Greenpeace had bid on the tracts.
"Although 16 companies had qualified themselves as bidders and industry had expressed interest in tracts included in the sale, no bids were received by industry by the deadline for bid submission," the department said in a terse statement.
The sale was to have included 989 tracts covering more than 6.5 million acres and had been scheduled today.
Interior's decision came shortly after U.S. District Court Judge David Mazzone in Boston granted an injunction sought by the state of Massachusetts, which objected to inclusion of 149 environmentally sensitive tracts encompassing about 840,000 acres in the rich Georges Bank fishing area.
Mazzone's decision marks the second time in two years that he has cited environmental concerns in halting sale of tracts off the New England coast. Interior has persevered in efforts to conduct the sale, despite lukewarm oil-industry interest.
Five years ago, a half-dozen wells drilled in the Georges Bank area turned up dry.
The crowning blow for the department apparently came at 1 p.m. yesterday, deadline for bid submissions. The only bids came from Greenpeace, an environmental group with a history of opposition to Interior's oil-leasing policies.
"We bid on 149 tracts -- all the sensitive ones, the ones in dispute," said Kelly Rigg of the organization's Boston office.
She declined to say what the organization bid, noting that Interior is now obligated to return bids unopened.
Interior apparently had no advance notice that Greenpeace would be among the bidders. While prospective bidders can submit qualification papers in advance, Rigg said, "We enclosed our qualification papers with the bids themselves."
The bids, she said, were submitted in envelopes bearing Greenpeace's name and logo.
The fact that Greenpeace was the only bidder does not necessarily mean that the organization would have received the leases. While the group apparently met corporate qualifications for participating in a federal oil- and gas-lease sale, Rigg noted that Interior "doesn't have to give the bids to anybody. They can turn down bidders."
Interior officials declined to comment on the Greenpeace bids or elaborate on the prepared statement. Rigg said the cancellation was a clear victory for environmentalists and should carry a lesson for Interior.
"Since nobody bid on them, it's obvious nobody wants them," she said. "It's kind of pointless. I would hope this is enough evidence to convince them that there isn't enough interest to warrant the process. It's a terrible drain of time and money."
Interior officials, who have said they believe that as many as 140 million barrels of oil are under Georges Bank, said the department would not appeal Mazzone's ruling.
The department apparently is still planning to proceed with a smaller sale in the North Atlantic, involving tracts claimed by Canada and the United States. The World Court in The Hague is considering that situation.