White House keeps oil, gas in Alaska picture amid climate emphasis

The White House quietly refused to rule out oil and gas development in Alaska as US President Barack Obama, Secretary of State John F. Kerry, and other top officials prepared to participate in a two-day Arctic issues conference Aug. 31 and Sept. 1 in Anchorage with other dignitaries from as many as 20 other countries.

Obama continued to emphasize climate change impacts on Alaska in his Aug. 29 weekly address leading up to his visit. “This is all real. This is happening to our fellow Americans right now,” he declared. “In fact, Alaska’s governor recently told me that four villages are in ‘imminent danger’ and have to be relocated.”

The US is leading the way in making a necessary transition from “dirty energy sources” to solar, wind, and other alternatives to address climate change impacts, the president said. But the US economy still has to rely on oil and gas as it accelerates the transition, he maintained.

“As long as that’s the case, I believe we should rely more on domestic production than on foreign imports, and we should demand the highest safety standards in the industry—our own,” Obama said.

He acknowledged some Americans’ concerns over developing offshore oil resources in environmentally sensitive waters, and specifically mentioned approvals by the US Bureau of Safety and Environmental Enforcement and other federal agencies for Shell Offshore Co. to drill on Chukchi Sea leases it has held since 2008 (OGJ Online, July 23, 2015).

“We don’t rubber-stamp permits,” Obama said. “We made it clear that Shell has to meet our high standards in how [it conducts its] operations—and it’s a testament to how rigorous we’ve applied those standards that Shell has delayed and limited its exploration off Alaska while trying to meet them.

Safety is top priority

“The bottom line is, safety has been and will continue to be my administration’s top priority when it comes to oil and gas exploration off America’s precious coasts—even as we push our economy and the world to ultimately transition off of fossil fuels,” the president said.

A senior US Department of State official made similar points in an Aug. 28 teleconference with reporters. “There are people who are protesting against the drilling; there are people that are upset and believe that the president has gone too far in terms of opening up the Arctic,” he said. “There are an equal number of people who believe that it has not been opened up enough.

“I’m not talking about the oil companies; I’m talking about the citizens of Alaska, and in particular, Alaskan natives. The people of Alaska want sustainable development that also protects the environment,” the official said.

“But at the same time, in a very pragmatic approach, we understand that we’re going to need the petroleum products at least for the foreseeable future,” he said. “Certain segments of the Chukchi and Beaufort Seas have been opened up for leases, and the companies that are up there have been doing things under a legal process and with strict review by the Department of the Interior and the US Coast Guard, and that is proceeding.”

The administration has taken a balanced approach, “and the fact that we probably have parties on both sides of the issue that are not completely satisfied is probably an indicator that we’re on a fairly safe course here,” the senior DOS official said.

Leaders from the Arctic Slope Regional Corp., Alaska’s largest Native-owned business, placed an open letter welcoming Obama to the state in news outlets there on Aug. 31. It urged him to strike a balance between responsible energy development and environmental stewardship within the Arctic.

“As stewards of our Arctic homelands, we have a unique and very important interest in ensuring that any development activities in the Arctic are carried out in a safe and responsible manner,” ASRC Chief Executive Rex Rock Sr. and Chairman Crawford Patkotak said in the letter. “We are also no strangers to oil and gas development. The industry has operated safely in our backyard for over four decades producing more than 15 billion bbl of oil from the North Slope in that time. With those barrels come jobs, security, and opportunity.”

Contact Nick Snow at nicks@pennwell.com.

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