Alaska leaders make the case for ANWR — again

Congressional hearing focuses on coastal plain as a source of jobs, energy and revenue; critic calls it ‘kowtowing’ to industry


It’s long been the case that Alaska’s top elected officials, regardless of party, have supported opening the coastal plain of the Arctic National Wildlife Refuge to oil and gas development. ANWR
The state’s current crop of leaders again demonstrated that stance during a Sept. 21 congressional hearing that one witness panned as “political theater.”
The House Natural Resources Committee and its Republican chairman, Rep. Doc Hastings of Washington state, convened the hearing to discuss ANWR in the context of jobs, national energy supply and reducing the deficit with leasing and royalty revenue.
The witness list was stacked with supporters of opening the coastal plain to drillers. They included Alaska’s three-member congressional delegation, Gov. Sean Parnell, a prominent resident from a village along the ANWR coast, and a truck driver who hauls freight to the North Slope oil fields.
They said opening the coastal plain could sustain or create scores of jobs and work economic wonders for the state and nation.
Murkowski ‘insulted’
Alaska’s senators, Democrat Mark Begich and Republican Lisa Murkowski, each expressed support for opening the coastal plain.
“With gasoline prices averaging $3.65 in the lower 48 states and unemployment around 9 percent, Alaska is here to help,” said Begich, according to the text of his testimony. “We can offer relief to consumers at the pump, provide well-paying jobs in Alaska and the Lower 48 and help reduce our $14 trillion deficit.”
Murkowski focused on the Obama administration’s consideration of designating practically all of the refuge — including the potentially oil-rich coastal plain — as wilderness. Such a move, which would take the consent of Congress, would pretty much foreclose the possibility of drilling.
“I find it to be both misguided and, as an Alaskan, somewhat insulting when federal agencies continue to look for ways to lock up additional wilderness in Alaska when Alaska doesn’t want it and when the law says, plainly, ‘no more,’” Murkowski’s written testimony said.
She was referring to the U.S. Fish and Wildlife Service effort write a new “comprehensive conservation plan” for ANWR. Murkowski argues the Alaska National Interest Lands Conservation Act of 1980 prohibits agencies from undertaking studies for new wilderness areas without congressional authorization.
“When an agency’s response to our Nation’s current debt and jobs crisis is to seek more ways to twist the law just to keep money buried in the ground, our priorities have spun out of the realm of rationality,” said Murkowski’s written testimony.
Young, governor weigh in
Alaska’s lone congressman, Republican Don Young, also cited the high price of gasoline in his testimony. It’s because domestic oil production hasn’t kept pace with demand, he said.
He gave a nod to those who fear oil and gas activity would compromise what has been described as ANWR’s pristine character.
“Let’s be honest and say that there will be some consequences to exploring and producing in ANWR,” said Young’s written testimony. “But let’s also be honest and say that if we import the oil it will arrive in the U.S. in foreign ships that sometimes are not up to our standards. And our environmental safeguards for oil production are much more stringent than theirs are. So if you are really concerned about the environment you should prefer oil to be produced here rather than somewhere else in the world. Just a few short weeks ago news broke of a deal that will partner Exxon and Russia to drill in the Arctic. Do we really trust that Russia can protect the Arctic better than we can?”
Gov. Parnell, a Republican, spoke to the committee via video conference.
“Look at the states doing relatively well in this economic downturn — they are America’s major energy producers,” he said. “And Alaska is one of those states. Yet we are held back from contributing more affordable energy to other Americans by federal regulators who want to keep federal lands off-limits to oil and gas exploration.”
Parnell told the committee the viability of the trans-Alaska pipeline is threatened by declining oil production. His goal is to boost throughput to 1 million barrels a day, well above the current level of around 600,000 barrels.
With modern technology, the governor said, the oil industry’s “footprint” could cover less than 2,000 acres of the refuge, which is nearly the size of South Carolina.
“For most of the year, the coastal plain is frozen. It has low biological activity,” Parnell said. “Experience shows that seasonal restrictions and other environmental stipulations can be used to protect caribou during their six-week calving season each summer. Appropriate restrictions can also protect migratory birds and fish. Our experience with other North Slope fields shows it can be done.”
A villager and a trucker
The U.S. Geological Survey, in a 2005 paper, estimated the coastal plain’s undiscovered, technically recoverable crude oil at 5.7 billion to 16 billion barrels, with a mean of 10.4 billion.
Fenton Rexford, a member of the Kaktovik City Council and a candidate for mayor of the North Slope Borough, told the committee that people in his village support responsible development on the coastal plain.
“I am a life-long resident of Kaktovik and I intend to grow old there,” his written testimony said. “I can compare what life in Kaktovik was like prior to oil development on the North Slope to the quality of life we have today because of my personal experience.”
He said ANWR development means a continuation of modern life for villagers: running water and flush toilets, a local school, police and fire services.
The Inupiat villagers wouldn’t favor development, Rexford said, unless they were confident development wouldn’t hurt their subsistence way of life.
The committee also heard from Carey Hall, a truck driver for Carlile Transportation Systems. He said he works on the “ice roads” hauling freight to and from the North Slope.
Finding new oil in places such as ANWR is crucial, he said.
“The oil and gas industry represents the cornerstone of our business,” he said. “It is not only important to contractors and vendors such as trucking companies but to all our citizens in the state of Alaska and as a nation. It produces jobs, lots of jobs, and we need jobs.”
The critics
Two witnesses invited by the committee minority had a markedly different view on using ANWR as a tool for creating jobs and fighting the national debt.
Gene Karpinski, president of the nonprofit League of Conservation Voters, said he is fighting for permanent protection of the coastal plain. He characterized the hearing as “nothing more than political theater.”
“Drilling in the Arctic Refuge is and always will be a political hot potato that has been voted on 20 times in the past 30 years, in the House of Representatives alone,” said the written text of Karpinski’s testimony. “Over and over again, pro-drilling members of Congress have trotted out our nation’s last great wilderness place as a panacea for everything from the budget deficit and high unemployment to providing heat for the poor, relief to hurricane ravaged states, support for our troops and health benefits to coal workers.
“Through it all, every attempt to drill the Arctic Refuge has ultimately failed because of the continued strong support of the American people who see this never-ending political spectacle for what it is — a kowtow to the wealthiest corporations in the world, the only ones who will actually benefit from opening the Arctic Refuge to drilling.”
David Jenkins, of Republicans for Environmental Protection, questioned the idea of the industry disturbing only 2,000 acres. Citing the USGS, he said any oil is likely to be scattered in small pockets across the entire plain.
“Oil development would necessitate a massive spider web of pipelines throughout the area,” he testified.
Rosy job projections on ANWR’s unproven oil reserves are overblown, and even a major oil find would be unlikely to significantly improve the nation’s energy security or reduce gasoline prices, Jenkins said.

Deep-water drilling in the Gulf of Mexico could resume within weeks

Path Clears for Deep-Water Drilling

By BEN CASSELMAN And DANIEL GILBERT
Deep-water drilling in the Gulf of Mexico could resume within weeks under a policy announced Monday by the Obama administration, which has come under increasing criticism from the oil industry and politicians in the region over the impact of the drilling halt.

Oil and gas exploration in the Gulf's deep waters has been stopped since May, when President Barack Obama announced a six-month drilling moratorium in the wake of the April explosion of the Deepwater Horizon drilling rig, which killed 11 workers and set off the worst offshore oil spill in U.S. history.

The administration lifted the ban in October—a month ahead of schedule—but hasn't issued any permits for new deep water oil wells.

On Monday, The Wall Street Journal reported that the delay has hurt both the oil industry, which has seen billions of dollars in projects put on hold, and the Gulf Coast's economy, which has been hit hard by the slowdown.

The administration said Monday that it would clear the path for 13 companies, including Chevron Corp. and Royal Dutch Shell PLC, to resume work on a handful of wells that were already approved and under way when the moratorium took effect. The 16 projects must still comply with strict new safety rules announced after the Deepwater Horizon disaster, but in most cases won't be subjected to new environmental reviews.

The announcement means that some drilling could resume in a matter of weeks, although the exact timing remains unclear. But the policy doesn't affect the more than a dozen permit requests that were pending when the moratorium took effect or have been filed since. Those must still undergo enhanced environmental reviews.

GE Bets on Deep Water Oil With $1.3 Billion Wellstream Bid Access thousands of business sources not available on the free web. Learn More Michael Bromwich, director of the Bureau of Ocean Energy Management, Regulation and Enforcement, the newly formed federal agency in charge of offshore drilling, said projects that were interrupted by the moratorium deserved special consideration.

"For those companies that were in the midst of operations at the time of the deep-water suspensions, today's notification is a significant step toward resuming their permitted activity," Mr. Bromwich said in a statement.

Oil companies in recent weeks had become increasingly pessimistic about a quick resumption of drilling in 2011, with some predicting that the wait would last into the second half of the year. On Monday, the industry praised the decision but said more details were needed.

"It appears to be a step in the right direction," Randall Luthi, president of the National Ocean Industries Association, a trade group, said in an interview. However, he said, "there are still major questions and some confusion among the companies about what is being required."

Elgie Holstein, a staff expert for the Environmental Defense Fund, an environmental group, said he didn't see any reason for projects halted by the moratorium to be treated as special cases. But he said the new policy was reasonable as long as regulators enforced the new safety and environmental rules. "I actually thought it was a balanced response," Mr. Holstein said. "It does relieve some of the pressure that the Gulf Coast has been feeling from an economic standpoint."

The administration has come under increasing pressure from Republicans and some Gulf Coast Democrats to allow drilling to resume. On Monday, lawmakers reacted cautiously to the announcement. Sen. Mary Landrieu, a Louisiana Democrat who has been a vocal critic of the administration's drilling policy, said some projects could still be thwarted.

"We need to know more about the conditions under which drilling will be allowed to resume and make sure those conditions don't actually undermine the intent," Ms. Landrieu said in a statement.

Doc Hastings, the Washington Republican who is incoming chairman of the House Natural Resources Committee, was also skeptical.

"Today's announcement by BOEMRE only ensures the possibility that previous drilling activity can resume at some point in the future if certain requirements are met," Rep. Hastings said in a statement. "The Obama administration can prove it's serious about resuming drilling in the Gulf by actually issuing permits and allowing people to return to work."

—Siobhan Hughes and Tennille Tracy contributed to this article.