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Murkowski Blasts Obama Administration's Alaska Energy Decisions

Senate Energy and Natural Resources Committee Chairman Lisa Murkowski (R-AK), who has repeatedly expressed frustration with the Obama administration's treatment of her state's energy resources, sparred briefly Tuesday with Department of Interior (DOI) Secretary Sally Jewel over that agency's attitude toward the Trans-Alaska oil pipeline.

"I'm frustrated, I'm very frustrated with the delays, the denials, the restrictions that we continue to see from the Department of Interior," Murkowski said during a committee hearing on DOI's $13.2 billion 2016 budget request. The amount of oil moving daily through the Trans-Alaska pipeline is less than half its maximum capacity, she told Jewell, and recent actions taken by the administration aren't like to increase that amount.

Last month, DOI released a draft strategy for offshore oil and natural gas leasing that included 14 potential lease sales in eight planning areas -- 10 sales in the Gulf of Mexico, three off the coast of Alaska, and one in areas offshore Virginia, North and South Carolina and Georgia -- but it did not include proposed lease sales for 9.8 million acres of the Beaufort and Chukchi seas that President Obama recently designated off limits to leasing (see Daily GPI, Jan. 27). In December, Obama extended indefinitely a four-year-old freeze for oil and natural gas leasing in the waters of Alaska's Bristol Bay, a move criticized by industry representatives (see Daily GPI, Dec. 17, 2014).

"Do you believe that the actions that we've seen out of the Department of the Interior are helping to keep the Alaska pipeline full?" Murkowski asked Jewell Tuesday.

"I am fully committed to supporting the efforts in the North of Alaska to keep the Trans-Alaska pipeline full," Jewell said.

"We have, as you know, supported development in the National Petroleum Reserve; 72% of what is estimated to be the recoverable oil is in areas that are open for leasing; we've doubled the frequency of leasing in the NPR-A [National Petroleum Reserve Alaska] lands under this administration, and we've recently approved ConocoPhillips preferred proposal for drilling in the National Petroleum Reserve. Offshore, 90% of the estimated recoverable oil and gas will be available for leasing in the Beaufort and Chukchi seas."

In sharply worded remarks opening the hearing, Murkowski said Interior's decisions affecting her state "have lacked balance, and instead of recognizing the many opportunities Alaska has with regards to resource production, you have enabled an unprecedented attack on our ability to bring these resources to market.

"The president has withdrawn over 22 million more acres of Alaska from energy production in recent weeks alone. That has occurred on top of many other restrictions and regulations being imposed on us. It has occurred despite the tremendous energy opportunity and potential in those areas, despite our 'no more' clause, despite the pressing need to refill our pipeline, and despite strong opposition from most Alaskans...

"So I just want to make very clear that I oppose this administration's decision on ANWR [Arctic National Wildlife Refuge]. I oppose its decision offshore. I oppose its costly restrictions and endless delays in the NPR-A...The actions of this administration seem destined to shut down our Trans-Alaska pipeline, weaken our economy, forcing our state to make steep budget cuts, and really, violating the promises that were made to us at statehood and since then.

"I had hoped that Interior's budget would not make the situation worse, but it fails to clear even that low bar. This request violates the Budget Control Act, ignoring the statutory caps and proposing new spending as if we had already lifted sequestration -- but that amounts to wishful thinking, not responsible governance. It would impose billions of dollars' worth of new fees and higher taxes on oil, gas, coal, and mineral production -- regardless of the consequences -- and would eliminate offshore revenue sharing, which many of us believe should expand."

Last week, Interior's Bureau of Safety and Environmental Enforcement (BSEE) and the Bureau of Ocean Energy Management (BOEM) issued proposed regulations that would add to and revise rules for Arctic Outer Continental Shelf oil and natural gas drilling activities that use mobile offshore drilling units and related operations use during the open-water drilling season (see Daily GPI, Feb. 20).

The Obama administration last month recommended designation of core areas and the coastal plain of the ANWR as wilderness, a move that infuriated Alaska's independent governor and its all-Republican contingent in Congress (see Daily GPI, Jan. 26). If approved by Congress, the wilderness designation would be the largest in Interior's history and would designate nearly all of ANWR's total 19.8 million acres as wilderness. Currently, more than 7 million acres of ANWR are managed as wilderness.

DOI's $13.2 billion budget request is an 8% increase over the 2015 level enacted for the agency. It would increase BLM's oil and gas program by 20% compared with 2015, Jewell said. The budget request would provide $170.9 million for BOEM and $204.7 million for BSEE, "the DOI agencies overseeing oil and gas development on the OCS."

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