NPC report outlines prime Arctic oil and gas research needs

Most of the US Arctic’s offshore potential conventional oil and gas can be developed using existing field-proven technology, a new National Petroleum Council report said. But substantial work still needs to be done to win the necessary public confidence that it can be done safely and without damage to either the environment or Alaska’s indigenous communities, it added.

“Further development of the US Arctic would enhance our national security by improving our energy security,” said ExxonMobil Corp. Chief Executive Rex W. Tillerson, who chaired the council’s Arctic Research Committee. “The main question is how to proceed.”

NPC undertook the study in response to US Energy Secretary Ernest G. Moniz’s Oct. 25, 2013, request for NPC to identify research DOE should pursue and constraints to be address to ensure prudent US Arctic oil and gas development while advancing domestic energy and economic security and ensuring environmental stewardship.

The resulting report, which the council formally approved on Mar. 27, said that both government and the oil and gas industry have a shared responsibility to gain and maintain public confidence that domestic Arctic oil and gas resources can be developed responsibly.

“Technology research has been an ongoing Arctic oil and gas activity for decades,” Tillerson said. “We believe current US regulations deserve to be re-evaluated because of technological changes.”

The report also found that:

·  Arctic oil and gas resources are large, and can contribute significantly to meeting future US and global energy needs.

·  The Arctic environment poses some different challenges relative to other oil and gas production areas, but is generally well understood.

·  The oil and gas industry has a long history of successful operations in Arctic conditions, enabled by continuing technology and operational advances.

·  Operating conditions and the need to update regulations to reflect those conditions challenge the economic viability of US Arctic oil and gas development.

·  Substantial recent technology and regulatory advancements reduce the potential for, and consequences of, a spill.

The study’s recommendations align with the Obama administration and DOE’s priorities, Deputy Energy Secretary Elizabeth Sherwood-Randall said at the meeting. “This report highlights the need for decision-makers to think strategically,” she indicated. “Actions we take now will affect our energy, economic, and national security far into the future.”

She said DOE’s areas of response will involve science and technology research to address Arctic challenges, integrated analysis of best operating practices and risk management techniques, contributions to government-wide Arctic policy development, and a continuing collaboration with the State of Alaska.

“This is a pivotal moment for US and international cooperation in the Arctic,” Sherwood-Randall said. “I expect this report will make a significant contribution.”

Contact Nick Snow at nicks@pennwell.com.

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