The Obama administration will not open up the southeastern Atlantic coast to drilling due to record-low oil prices and strong local opposition, it said on Tuesday.
The U.S. Interior Department plans to announce on Tuesday afternoon that it will not schedule any lease sales offshore in the mid- and south Atlantic after "an extensive public input process."
Besides market and environmental concerns, the department also based its decision on conflicts with competing commercial and military ocean uses.
The decision will reverse the department's January 2015 proposal for new leases in the Atlantic as part of its five-year plan to set new boundaries for oil development in federal waters through 2022.
The proposal would have opened up drilling sites more than 50 miles off Virginia, North and South Carolina, and Georgia to oil drilling by 2021.
Coastal communities in these states protested the administration's 2015 plan, fearing the possibility of a local oil spill, like the BP Horizon accident in 2010 on the U.S. Gulf Coast, and its effects on tourism and their economies.
"With this decision coastal communities have won a ‘David vs. Goliath’ fight against the richest companies on the planet, and that is a cause for tremendous optimism for the well-being of future generations,” said Jacqueline Savitz, environmental group Oceana's vice president for U.S. oceans.
Virginia officials had welcomed the plan to allow offshore drilling, saying it would bring economic benefits.
On Monday, the American Petroleum Institute industry group said expanding offshore drilling would improve everything from infrastructure to education.
"This is a once-in-a-generation opportunity, stuck, off limits to future generations as it waits for forward-looking energy policy," said Erik Milito, API's director of upstream and industry operations.
(Reporting by Valerie Volcovici; Editing by Chizu Nomiyama and Lisa Von Ahn)