Despite congressional approval, oil and gas drilling in Alaska's ANWR is still years away
WASHINGTON – Energy companies from as far away as Australia started calling geologist David Houseknecht late last year when it became clear that Congress was going to end a three-decade-old ban on oil and gas drilling in Alaska’s Arctic National Wildlife Refuge.
But the U.S. Geological Survey’s Alaska specialist and other experts are cautioning that it will likely be years before drilling actually begins – if it does at all.
Congress’ decision to lift the drilling ban as part of the GOP tax-reform package approved in December may have removed the biggest obstacle to oil and gas exploration in the refuge’s coastal plain. But many other hurdles remain.
Regulatory procedures, the threat of lawsuits by environmentalists and the possibility of additional seismic testing to determine how much oil and gas is buried there could slow down the push for drilling in the Arctic refuge, or ANWR as it is often called.
“My youngest son is 8 – he’s in the second grade,” said Kara Moriarty, president and chief executive officer of the Alaska Oil and Gas Association, a trade group. “We probably won’t see production from ANWR until he graduates from college.”
In its legislation lifting the ban, Congress ordered two lease sales in ANWR – the first within four years, the second within seven. Each lease sale is to include at least 400,000 acres.
The Interior Department said in January it doesn’t yet have a time frame for the first lease sale. Secretary Ryan Zinke signed an order last May calling for an update of assessments of the recoverable oil and natural gas resources in Alaska’s North Slope, including the 1.5-million-acre area of ANWR where drilling will be allowed. That assessment is due next year.
ANWR is a remote area in northeastern Alaska that has long been presumed to be rich in natural resources. But additional seismic studies may need to be done to get a better picture of what lies underground.
No one knows for sure how much oil is available in ANWR because only one exploratory well has been done there. That was back in the mid-1980s in a joint project paid for by a consortium of energy companies.
The Geological Survey estimates there are 5 billion to 16 billion barrels of recoverable oil in the coastal plain. But those estimates were based in part on the tests done in the ‘80s, which relied on technology that is now considered outdated.
New 3-D technology would provide much clearer images beneath the surface, Houseknecht said. The difference between the old technology and the new “is really night and day,” like the contrast between an X-ray and MRI image of an injured knee, he said. But right now, it’s not clear whether energy companies would be willing to fund such tests.
Regardless, “there is a high level of interest” in the area, Houseknecht said.
Once the government decides which lands will be available for lease, interested companies would have to submit proposals. At least one public comment period will be held, giving drilling opponents a forum to air their grievances.
Environmental groups already are threatening legal action in hopes of heading off any drilling before it begins.
“We are planning to fight this every step of the way, from Congress to the courtroom,” said Suzanne Bostrom, an attorney for Trustees for Alaska, a nonprofit environmental law firm.
In its review, the government must consider drilling’s impact on humans and the environment in ANWR, which is home to a myriad of wildlife, including polar bears that are protected under the Endangered Species Act.
“There are a whole host of environmental obligations and laws that apply, and we are going to be keeping a close eye on every step the Trump administration makes to make sure those laws are followed,” said Adam Kolton, executive director of the Alaska Wilderness League.
Another potential stumbling block: If drilling is delayed for a prolonged period, control of Congress and the White House could shift from Republicans back to Democrats, who have long opposed drilling in ANWR. They would almost certainly move to reinstate the ban, raising the possibility that drilling would be stopped before it ever starts.
The threat of lawsuits or political uncertainty are unlikely to scare away companies or temper their interest in tapping into whatever natural resources are awaiting in the Arctic refuge, Moriarty said.
“If companies speculated about what’s going to happen in the political environment four years from now, if they’re hedging their bets on something they can’t control, they’d never make any decision at all,” she said. “All we can do is respond to the policies that are in front of us.”
In fact, she said, she’d rather the Interior Department take its time in the run-up to drilling and get it right.
“We know that whatever they do has to be legally defensible in court,” she said. “If that means it takes a few extra months to make it happen, then it’s better for the agency and it’s better for us.”