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Page added on December 9, 2017
Sale of Arctic oil leases goes bust
The federal oil-lease sale promoted as the largest ever in Alaska’s Arctic Reserve sold only seven tracts, or 0.8% of the 900 tracts offered, undercutting Republican arguments that they can help pay for their proposed $1.5 trillion tax cuts for the wealthy by selling oil leases in the Alaskan wilderness.
ConocoPhillips Alaska and Anadarco E&P Onshore LLC jointly submitted bids totaling $1.2 million, leasing 79,998 acres of the 10.3 million acres offered.
“The Arctic Refuge isn’t a bank,” said David Yarnold, the president and CEO of the National Audubon Society. “Drilling there won’t pay for the tax cuts the Senate just passed.”
The highest bid amount per acre in Wednesday’s lease sale was $14.99, about $35 less than an average bid for drilling in the National Petroleum Reserve since 1999. Oil companies would have to bid an average of $2,400 per acre for each of the 1.5 million acres on the coastal plain of the Arctic National Wildlife Refuge to meet Trump’s budget.
“Current presidential and congressional budget projections are unrealistic, and … it would be fiscally irresponsible to pursue this path on a budget justification,” said David Murphy, an assistant professor of environmental studies at St. Lawrence University.
Alaska’s National Petroleum Reserve, the single largest parcel of public land in the United States, was created in 1923 by former President Warren Harding when Navy vessels were being converted to run on oil instead of coal.
The reserve holds an estimated 896 million barrels of recoverable oil and about 53 trillion cubic feet of natural gas, according to a 2010 estimate from the U.S. Geological Survey. Five areas of the nearly 23 million-acre reserve have special protection under a 2013 land management plan, including the shallow Teshekpuk Lake, larger than Lake Tahoe.
Caribou have their calves near the lake, and migrating birds include swans, Arctic terns and yellow-billed loons.
In May, Interior Secretary Ryan Zinke ordered a review of the reserve’s management plan.
“The road to energy dominance goes through the great state of Alaska,” Zinke said.
ACTION BOX/What You Can Do About It
Call Ryan Zinke, the secretary of the Department of the Interior, at 202-208-3100 to tell him to keep environmental protections at the National Petroleum Reserve–Alaska or write him at U.S. Department of the Interior, 1849 C Street NW, Washington, D.C. 20240. Zinke is also on Facebook and Twitter.
Call the senators and representatives on the tax bill conference committee to tell them to keep oil drilling out of the Arctic Refuge. Rep. Kevin Brady (R-Texas) is leading the committee. Call him at 202-225-4901.
Here’s a list of the other members of the committee.
Lisa Bruner, company Alaska vice president of North Slope operations and development for ConocoPhillips, has said thecompany will ask Bureau of Land Management to open up some territory near Teshekpuk Lake.
“If industry is allowed to enter into some of these very sensitive habitat areas, it would change these areas permanently,”said Nicole Whittington-Evans, the Alaska regional director for the Wilderness Society.
The lease sale comes amid layoffs in Alaska’s oil fields. North Slope oil and gas employment peaked at 13,485 jobs in March 2015 but has fallen to levels last seen a decade ago as oil prices have fallen. In October, Alaska had the nation’s highest unemployment rate at 7.2%.
Murphy, the St. Lawrence University assistant professor, said the expectation that oil prices will remain high enough to justify a long-term investment in the Arctic Refuge has not been supported historically.
“Today, many analysts are projecting low oil prices for decades,” Murphy said.
7 Comments on "Sale of Arctic oil leases goes bust"
Sissyfuss on Sat, 9th Dec 2017 7:51 pm
President Bankruptcy working his magic.
onlooker on Sat, 9th Dec 2017 8:01 pm
I think Arctic sightseeing tours will also go bust. After all, us cancer monkeys have our sensibilities. Nobody wants to see polar bears literally starving to death
deadlykillerbeaz on Sun, 10th Dec 2017 3:43 am
There has got to be oil in that wilderness area. The lease should cost nothing and at 14.99 per acre, that is what it costs, nothing.
Hey, fill up the Arctic Refuge with wind turbine and solar panel parks!
It’ll be green energy, shouldn’t harm a single mosquito flying close to the Earth’s surface all summer long up there.
Wind turbines and solar panels in the Arctic Refuge will definitely keep that wilderness area clean and pristine. There will be no harm done, so it is time to pour cement by the millions of tons.
Who cares about migratory birds and a few raptors? Not those stupid scientists and greedy commercial investors like Warren Buffett, he would be all in to blanket the Artic wilderness with wind turbines and solar panels. Who cares if the sun doesn’t shine there for six months, it still makes sense if you can make money. It’s time to get that stuff done.
The revenues from the energy generated can pay for the 1.5 trillion buy down. It’ll be a win win and no humans will be harmed, nobody lives there.
Save the earth, build green energy parks by the thousands in the Arctic Refuge.
Humanity is saved! Hallelujah, since it’s Sunday and all.
Oil will make it one nasty place for polar bears and caribou to starve to death.
Can’t have that, just that green energy propaganda, night and day, 24/7, 365.
Enough to make you puke, power barf non-stop for days, months, years.
Have a good day.
Makati1 on Sun, 10th Dec 2017 5:54 am
If there are no likely profits, there will be no oil. Why can’t capitalists understand their own system? The FF demand is shrinking along with the ability to purchase. No one is going to make a multiyear investment before a drop of oil can be recovered with today’s prices and the likelihood that they will be even lower in the future.
Bug on Sun, 10th Dec 2017 8:25 am
Correct me if I am wrong, but doesn’t this
Concretely prove that drilling and exploration is uneconomic there?
If oil prices are expected to rise, wouldn’t the place be all bid on? How do you also drill up there? A drillship floats on the sea and land rigs are on solid earth, isn’t this unstable?
rockman on Sun, 10th Dec 2017 12:06 pm
Not sure I would call it a “bust”: went as well as the industry expected. I don’t think most understand how picked over all the federal leases are at this point in time. So they offered 10 million acres for lease and not many bids. Big f*cking deal. LOL. The last GOM lease sale in August offered 75 MILLION ACRES. And bids were received on only 500,000 acres.
Couldn’t find details but I’m pretty sure tracks offered for lease in both sales have been offered before. Probably multiple times. I think many folks get confused by the rhetoric from both sides. Federal leases from the regions we’re talking about have been offered for decades. Similarly over 400 exploration wells have been drilled on those federal lands on the North Slope. So it’s not exactly virgin territory.
After Prudhoe Bay was discovered companies went ape sh*t looking for another. But remember Prudhoe Bay Field was discover 49 years ago…yes, half a century. And many thousands of miles of seismic shots and lots of wells drilled. By any measure this is a very mature play.
And the great abundance of mature oil plays on the planet is exactly why there is a website called peakoil.com. Secretary Perry should have explained that to the POTUS. He’s seen enough proof of that during his time as a Texas governor.
Ghung on Sun, 10th Dec 2017 5:06 pm
“Secretary Perry should have explained that to the POTUS. He’s seen enough proof of that during his time as a Texas governor.”
Gosh, Rock, whether or not he did is irrelevant to POTUS as long as he can tout it as another of his great, great accomplishments. Trump knows that most people, especially in his base, know nothing worth knowing about this area, and could care less. As long as they can give those liberal progressive enviro-weenies the finger, it’s all good.
Besides, it may be good for another season of Ice Road Truckers.