ANWR Lease Cancelations: More Policy Incoherence, a Weakening of Future Energy Security

Mark Green
Posted September 8, 2023

Three takeaways from the Biden administration’s cancelation of oil and natural gas leases on Alaska’s coastal plain inside the Arctic National Wildlife Refuge, as well as proposed further restrictions on petroleum development inside the (**irony alert**) National Petroleum Reserve-Alaska (NPR-A) – both of which compromise America’s future energy security:

 

1. Surprise, No Surprise

By now, Americans should expect incoherence from Washington on energy policy – the one-step-forward, two- (or more) steps-backward tactics that serve to undermine American oil investment and production.

Just a few weeks ago, Energy Secretary Jennifer Granholm said more supply was needed to bring stability to global markets, roiled by OPEC+ production cuts.

And earlier this year the administration gave the go-ahead for the Willow Project inside the NPR-A – which Interior Secretary Deb Haaland defended afterward, saying: “We’re not going to turn the faucet off and say we’re not drilling anymore … We’re not going to say we’re not going to use gas and oil. That’s not reality.” The administration has been backpedaling ever since.

It’s no way to conduct energy policy as global markets continue to be churned by OPEC+ production cuts. While U.S. crude oil production has increased, that growth on federal lands and waters is because of investments made years ago – and future American energy security depends on new investment and exploration decision made today. Cordoning off American oil and natural gas resources could have dire energy consequences in the future.

Holly Hopkins, API vice president of Upstream Policy:

“[The] announcement sets a concerning precedent for the future of oil and natural gas leasing, exploration and production on federal lands. This industry needs clear, consistent policies in place to support the long-term investment needed to produce affordable, reliable energy, but the Biden administration instead continues to send the wrong signals. We urge the administration to stand up for Alaskan communities and the economy by establishing a forward-looking vision for domestic energy production in the state and across the country.”

Let’s point out that a contributing factor to the relatively low interest in the January 2021 ANWR lease sale, at the very end of the Trump administration, was concern that the incoming Biden administration might turn around and cancel any leases sold. Unfortunately, those concerns were realized this week.

 

2. Alaskans, Including Indigenous Peoples, React Bitterly

Take a look below at bipartisan criticism of the administration’s actions, from Alaska’s congressional delegation and leaders of Alaska Native communities. A sampling:

U.S. Rep. Mary Peltola, a Democrat:

“I am deeply frustrated by the reversal of these leases in ANWR. This administration showed that it is capable of listening to Alaskans with the approval of the Willow Project, and it is some of those same Inupiat North Slope communities who are the ones that are most impacted by this decision. I will continue to advocate for them and for Alaska's ability to explore and develop our natural resources, from the critical minerals we need for our clean energy transition to the domestic oil and gas we need to get us there. We can only get to that transition by listening to the people on the ground.”

Nagruk Harcharek, Voice of the Arctic Iñupiat president:

“Today’s decision once again shows that the Biden administration prioritizes their agenda over the will of local Indigenous communities. By dismissing the needs and interests of the people who call this region home, they continue to impede the self-determination of the Iñupiat of the North Slope. These actions contradict local, Indigenous-led resolutions despite the administration’s ‘pledge’ to listen and work with Indigenous communities.”

Annie Tikluk, mayor, City of Kaktovik:

“We are being blindsided by this action! Our community fought hard to get the Coastal Plain opened to oil and gas leasing. We are an economically underserved community and are continually looking for economic opportunities for our long-term sustainability.  … One of the opportunities we always looked towards was the future potential of oil and gas leasing in the Coastal Plain. The Secretary’s actions today basically go against Congress and again take rights away from us to manage our own lands to provide for our future.”

 

3. Safe ANWR Development Continues to be Misunderstood

Media coverage of the ANWR decision is a reminder that safe oil and natural gas development in ANWR has not been well understood for decades – and still is. Reminders, including a few from this blog and an analysis from the U.S. Energy Information Administration (EIA):

• The entirety of ANWR is the size of South Carolina, about 19 million acres.
• But the coastal plain, or Area 1002, where oil and natural gas would be developed is 1.5 million acres.
• Surface development within Area 1002 would be limited to 2,000 acres on federal lands, or about the size of a major airport (represented in the map below by the little red box above the “A” in ANWR Coastal Plain:

 

 

• EIA projected that full development of the ANWR coastal plain could contribute up to 1.45 million barrels per day (mb/d) of oil production, help reduce global oil prices, reduce U.S. oil imports, and increase U.S. jobs.
• Further, coastal plain development had the potential to make more efficient use of underutilized infrastructure, including the Trans-Alaskan Pipeline System (TAPS). In 1988, TAPS had a flow rate of 2.1 mb/d. It operates at under 500,000 barrels per day today.

 

To sum up – we have more mixed messages from the Biden administration, blistering unhappiness from Alaskans and continued misconceptions of the actual ANWR coastal plain footprint. Always a political football, ANWR again is being punted around to the detriment of America’s future energy security. Stay tuned.