Obama moves to ban offshore drilling in the Arctic, Atlantic

Offshore staff

WASHINGTON, D.C. – After establishing a partnership in March, US President Barack Obama and Canadian Prime Minister Justin Trudeau coordinated on Dec. 20, to launch a drilling ban in Arctic waters.

The decision cited the “important, irreplaceable values” of Arctic waters to native cultures, wildlife, and scientific research; “the vulnerability of these ecosystems to an oil spill; and the unique logistical, operational, safety, and scientific challenges and risks of oil extraction and spill response in Arctic waters.”

According to a statement released by the White House, the two North American leaders moved to designate the majority of US waters in the Chukchi and Beaufort seas as indefinitely off limits to offshore oil and gas leasing.

Canada will designate all Arctic Canadian waters as indefinitely off limits to future offshore Arctic oil and gas licensing, to be reviewed every five years through a climate and marine science-based life-cycle assessment, the statement continued.

US Secretary of the Interior Sally Jewell released a statement to applaud the announcement.

“The president’s bold action recognizes the vulnerable marine environments in the Arctic and Atlantic oceans, their critical and irreplaceable ecological value, as well as the unique role that commercial fishing and subsistence use plays in the regions’ economies and cultures,” Jewell said.

Jewell said that the withdrawal areas announced today encompass 3.8 million acres in the north and mid-Atlantic Ocean off the east coast and 115 million acres in the US Arctic Ocean.

“Including previous presidential withdrawals, today’s action protects nearly 125 million acres in the offshore Arctic from future oil and gas activity,” Jewell said, while noting that the withdrawal does not restrict other uses of these federal waters on the outer continental shelf.

The withdrawal also does not affect a nearshore area of the Beaufort Sea, totaling about 2.8 million acres, that has high oil and gas potential and is adjacent to existing state oil and gas activity and infrastructure.

While there are significant concerns about oil and gas activity occurring in this area, it will be subject to additional evaluation and study to determine if new leasing could be appropriate at some point in the future. Interior’s five-year offshore leasing program for 2017-2022 does not include lease sales in this area or in the withdrawn areas.

While Jewell was pleased, other industry bodies did not express such positive reactions.

“The administration has always justified a ban on Arctic development because of an alleged lack of local support or industry interest,” said a spokesperson from The Arctic Energy Center. “The Arctic Energy Center’s research categorically shows that that is simply not true, with almost three quarters of Native respondents supporting offshore energy.

“Taken with last week’s news that sales of Beaufort Sea and North Slope leases generated $18 million, it is hard to avoid the conclusion that the Obama administration is playing politics with the future of Alaska.”

In addition, some news outlets have been reporting that by invoking the Outer Continental Shelf Land Act, the action cannot be reversed by the incoming Trump administration, which also spurred some reaction across the industry.

“President Obama’s short sighted, unilateral withdrawal of Atlantic and Arctic Ocean areas from future oil and gas leasing not only risks the long-term energy security and energy leadership position of the United States, it violates the letter and spirit of the law,” said National Ocean Industries Association President Randall Luthi.

“Such an expansive withdrawal, particularly when argued as being ’permanent’, is clearly inconsistent with the Outer Continental Shelf Land Act’s steadfast declaration that ‘... the outer continental shelf is a vital national resource reserve held by the federal government for the public, which should be made available for expeditious and orderly development, subject to environmental safeguards, in a manner which is consistent with the maintenance of competition and other national needs ...’” 

Luthi also continued by saying that Obama “has benched the United States, dismissing his own advisors who have argued that energy development, particularly in the Arctic, is imperative to our national security.”

Similarly, US Chamber of Commerce Energy Institute’s Christopher Guith said that the ban is not binding for the next administration and “must be undone in order to work towards a commonsense offshore energy plan.”   

12/21/2016

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