Alaska's two Republican senators have introduced a bill that calls for conducting lease sales in the state's offshore areas of the Beaufort Sea and Cook Inlet, and would reverse a decision made during the waning days of the Obama administration to withdraw leasing areas of the Arctic's Outer Continental Shelf (OCS).
Sens. Lisa Murkowski and Dan Sullivan introduced a bill -- S 883, also known as the Offshore Production and Energizing National Security Alaska Act of 2017, or OPENS Act -- last week. The legislation was read twice Thursday and referred to the Senate Committee on Energy and Natural Resources, which Murkowski chairs.
"After years of regulatory restrictions and burdens imposed by the Obama administration, this bill charts a much better course for responsible energy production in our Beaufort and Chukchi seas that actually reflects the views of the vast majority of Alaskans," Murkowski said in a statement. "These areas contain prolific resources that can be safely developed to create jobs, reduce our deficits, keep energy affordable, and strengthen national security."
Sullivan added that the Obama administration "tried to kill responsible resource development in the Arctic, ignoring the fact that the rush to the Arctic is on. Oil and gas will be developed in the region -- whether by our nation or others. It is imperative that exploration and development occur with all of the safeguards required by the United States to protect the environment and the people who live in the region."
S 883, among other things, directs the secretary of the Department of Interior (DOI) to establish a new Nearshore Beaufort Sea Planning Area in the OCS, consisting of the portion of the existing Beaufort Planning Area within three nautical miles of the seaward boundary of Alaska. It also directs the DOI secretary to conduct one annual lease sale each in the Nearshore Beaufort and Cook Inlet planning areas, during fiscal years (FY) 2018, 2019 and 2020.
The bill also calls for amending the OCS Lands Act by including the Beaufort, Chukchi, Cook Inlet and Nearshore Beaufort planning areas to its five-year leasing programs. At least three lease sales would be required annually in the Beaufort and Chukchi planning areas, and one annual sale each in the Nearshore Beaufort and Cook Inlet planning areas.
Last December, President Obama issued a presidential memorandum withdrawing vast areas of the nation's OCS from future oil and gas drilling. He withdrew 115 million acres in the Arctic OCS and 3.8 million acres in the north and mid-Atlantic OCS, located off the East Coast.
In their joint statement, Murkowski and Sullivan contend that the Trump administration has the authority to revoke Obama's withdrawals, but decided to introduce a bill "to set a marker that reflects the views of the vast majority of Alaskans." A poll commissioned last year by the Arctic Energy Center found that 76% of Alaskans support offshore resource development in the state.
During his presidential campaign, Trump proposed allowing states to regulate energy development over federal agencies and opening up more federal lands to drilling.
The senators added that the Beaufort and Chukchi seas combined form one of the most prospective basins in the world, with an estimated 23.6 billion barrels of oil and 104.4 Tcf of natural gas.
Despite the bounty, Royal Dutch Shell plc, once the biggest leaseholder in offshore Alaska, said last May that it will abandon all but one of its leases in the Chukchi, and was evaluating its holdings in the Beaufort. At the time, the international major cited an "unpredictable" regulatory environment and disappointing initial drilling results.
Shell, ConocoPhillips, Italy's Eni SpA and Iona Energy Inc. together relinquished about 350 leases, covering 2.2 million acres of drilling rights, in the Chukchi before a deadline to do so.