Trump administration will hold Arctic refuge oil lease sales this year, official says

Joe Balash, Interior’s assistant secretary for land and minerals management, told an oil industry group in Anchorage that an ANWR lease sale would be held in 2019.

After decades of oil development prohibitions in the Arctic National Wildlife Refuge, the Trump administration is poised to start auctioning off oil leases within a few months, a top Department of the Interior official said on Thursday.

Interior will definitely meet its goal of holding an ANWR lease sale this year, Joe Balash, Interior’s assistant secretary for land and minerals management, said in a speech at the annual conference of the Alaska Oil and Gas Association.

The draft environmental impact statement for ANWR coastal plain leasing, issued last December by the Interior’s Bureau of Land Management, will be followed by a final environmental impact statement “by the end of this summer, I think August,” Balash told the audience.

“And once we have a final EIS we’ll be in a position to issue a record of decision and notice of lease sale. And that lease sale will happen in 2019,” he said, to audience applause.

That process has required a review of the more than 1 million public comments submitted on the draft environmental impact statement, comments that raised about 2,500 separate concerns, Balash said.

The pace of the environmental review has drawn harsh criticism from drilling opponents. Adam Kolton, executive director of the Alaska Wilderness League, said the Trump administration’s work has been sloppy and rushed, “for no other reason than when the elections are,” and likely violates several environmental laws.

“In the history of environmental reviews, there’s been nothing like this,” Kolton said.

He pointed out that Congress’s 2017 federal tax rewrite that included a provision requiring ANWR oil leasing specified that the first lease sale was to be held within four years of the act becoming law. The Trump administration is attempting to cut that time by half, he said.

The BLM will need much more time than a few months to address the public comments submitted on the draft EIS, Kolton said. “We’ll be interested, obviously, when the final comes out the degree of care they took to address those concerns,” he said. “They’ll be very vulnerable to legal challenges.”

Governments in Canada have also criticized the draft EIS as inadequate. The federal, provincial, territorial and tribal governments, in comments submitted to the BLM, have called for a supplemental environmental impact statement to address development impacts to the Porcupine caribou herd, which roams across the Alaska-Canada border, and other issues of Canadian concern.

Balash also pointed out the Trump administration’s success in efforts to advance oil development in other parts of Arctic Alaska.

Along with the ANWR lease sale, a draft plan to overhaul management of the 23 million-acre National Petroleum Reserve-Alaska on the western side of the North Slope is also coming later this year.

Balash and Trump administration officials have declared intentions to overturn protections granted by the Obama administration in the 2013 integrated activity plan, replacing it with a more pro-development plan.

Toward that end, the administration is working on “alternatives that will open more of the acreage up there,” Balash told the AOGA audience. The draft environmental impact statement will likely be issued by the end of summer, with a final to come the following year, he said.

Exploration successes on the western side of the North Slope show the need for lifting development restrictions, he said.

“The recent discoveries and understandings of the geology there tells us what some people knew all the way back in 1923 when President Harding established the petroleum reserve. And that is, it is an oil and gas province. It is one that can provide enormous opportunity for the county and we’re seeking to make that a new opportunity further than we’ve seen before,” he said.

Among the discoveries in the NPR-A is the Willow prospect, which developer ConocoPhillips believes holds 400 million to 750 million barrels of recoverable oil. Balash said the BLM expects to issue a draft environmental impact statement on Willow development by the end of the summer and a final version next year.

The plan to open more NPR-A acreage to oil development got an endorsement from Sen. Lisa Murkowski, who delivered a closing keynote address to the conference by video.

“We have to revise the integrated activity plan to increase access; that to me is just a given. We need to make sure that permitting process continues without the sort of interruption and delays that were really the hallmarks we saw in the last administration,” Murkowski said in her address. “If we can seize some of these opportunities we can put hundreds of thousands of barrels back in the pipeline and make a big difference for Alaskans and for the economy.”

Alaska’s North Slope currently produces about 500,000 barrels of oil per day, down from peak production of 2 million barrels per day in the late 1980s. Leaders in Alaska, where the state budget relies heavily on oil revenues, and supporters of the oil industry have argued that expanded drilling across the Arctic is needed to slow or possibly reverse that decline.

Balash, in his speech, blamed earlier administrations for holding back Alaska oil growth. While U.S. oil production increased by nearly 60 percent since 2008, “you know all too well that Alaska has not been a part of that tremendous opportunity and cycle, in large part because the federal government has not been a partner in the progress that the people of Alaska seek,” he told the AOGA audience.

However, the latest setback for expanded Arctic oil development came from the judicial branch, he noted. The March 29 decision by U.S. District Court Judge Sharon Gleason that struck down the administration’s plans for offshore oil leasing in the Arctic outer continental shelf “really compromised our ability to bring a lot of new resources to the table here in Alaska,” he said. The administration is appealing the decision, but the process will be long, he said.“We have a lot of work in front of use before we’re going to know exactly what the future holds here for the Arctic OCS,” he said.

Balash mentioned one new initiative that could give the state of Alaska more control of territory important to the oil business.

The BLM is considering ceding control of much of the corridor used for the trans-Alaska pipeline to the state, he said. That option could be written into a new management plan for the 56-million-acre Central Yukon Planning Area, he said. The area is one of several in the state for which the BLM issues periodic management updates.

Giving the state control of the pipeline corridor would benefit the system’s operator, Alyeska Pipeline Service Co., Balash said. Currently, Alyeska has to “deal with a whole bunch of extra regulators, both federal and state, all kind of doing the same job,” he said. The pending management plan update will give the Alaska Department of Natural Resources the opportunity “to explain to BLM why that’s a good decision, and hopefully folks in this room can help them with that explanation,” he told the audience.

The state of Alaska has its own Arctic oil lease sales tentatively scheduled for December, for the central North Slope, the Brooks Range foothills and state territory offshore in the Beaufort Sea. Corrie Feige, commissioner of the Alaska Department of Natural Resources, told the AOGA audience that the state will try to coordinate those sales with the BLM’s planned ANWR lease sale.