Will Oil Lease Sale for Arctic National Wildlife Refuge Lead to Actual Drilling?

Will Oil Lease Sale for Arctic National Wildlife Refuge Lead to Actual Drilling?

On Jan. 6, 2021, the Department of the Interior will hold the first-ever sale for oil and natural gas leases within the boundaries of Arctic National Wildlife Refuge—exactly two weeks before the new presidential administration begins. Many hunters and anglers are anxious to know whether oil exploration will commence within the protected, northern Alaska landscape and what effects that might have on fish and wildlife.

President-elect Joe Biden has promised to permanently protect ANWR from drilling, but it is unclear what options his administration will have once leases are officially issued. Also unclear is the demand for leases during a worldwide oil glut and severely depressed prices. Accessing oil in the remote refuge will be expensive, and no one really knows how much oil is under there. Further complicating matters, all the major American banks—including Goldman Sachs, JP Morgan Chase, Wells Fargo, Citigroup, Morgan Stanley, and Bank of America—have publicly announced that they will not lend money to any ventures involved in drilling inside ANWR due to strong public opposition. A study completed by Yale University found that some 70% of Americans oppose drilling in the refuge. Several environmental groups, native tribes, and 15 states are currently suing to prevent the lease sale from happening.

The Arctic Refuge, as it is commonly known, contains 19.3 million acres of the North Slope of the Brooks Range—basically the upper righthand corner of Alaska from the last big mountains to the Arctic Ocean. It’s bordered on the west by the Dalton Highway and the oilfields of Prudhoe Bay and on the east by the Canadian border. No roads access or enter the refuge and the only settlements are two native villages, Kaktovik of the Inupiat Tribe and Arctic Village of the Gwich’in. It’s the largest wildlife refuge in the country, hosting robust (and mostly huntable) populations of caribou, moose, muskox, Dall sheep, wolves, wolverines, king eiders, ptarmigan, and all three North American bear species: black, grizzly, polar.

The area was first proposed for protection by wilderness advocates Bob Marshall, Olaus and Margaret Murie, and others, and it became a national wildlife refuge in 1960 during the administration of President Dwight Eisenhower. The modern borders were established in the 1980 Alaska National Interest Lands Conservation Act, which designated 8 million acres as wilderness but held open the door to studying the effects of energy exploration on the coastal plain at the northwest corner of the refuge. Any oil leasing would have to be authorized by Congress, and energy companies and Alaska politicians spent 40 years trying to achieve that goal in order to increase oil revenues and create jobs.

One estimate suggests that ANWR drilling authorization has been proposed in Congress nearly 50 times since 1977. In 2014 the Obama administration sought to designate the coastal plain as wilderness, but the effort failed in the legislature. In 2017, the Republican-led Senate and House included ANWR drilling in their tax overhaul, Alaska Sen. Lisa Murkowski’s long-fought ambition, and President Trump signed it into law.

The BLM then conducted an Environmental Impact Statement of the potential effects of energy exploration in the untouched landscape. That study, completed in August on a compressed timeline, suggested that seismic testing, the creation of an estimated 175 miles roads into the refuge, and building drilling pads would have minimal impacts on the ecosystem and wildlife, and the authors recommended opening the entire 1.5 million acres of the coastal plain to oil and gas leasing. The U.S. Fish & Wildlife Service, which manages the refuge, disputed the contents of that EIS, as did numerous states, congressional representatives, tribes, environmental groups, and conservation organizations—many of which are challenging the rigor of study in court. The Porcupine Caribou Herd, which complete the longest land migration of any animals on earth, birth their calves every spring in the ANWR coastal plain and could be particularly affected by energy exploration.

Stephen Klobucar, a biologist at University of Alaska, Fairbanks, and MeatEater contributor, has spent a great deal of time fishing, hunting, and studying the ecology of ANWR.

“For high arctic ecosystems to have a fighting chance moving forward, ecological and biogeochemical connections need to be maintained across the landscape. For example, caribou migrations to and from calving grounds, the timing of vegetative green-up and spring snowmelt, or the ability for arctic grayling to move between networks of river and lakes,” Klobucar said. “That’s no different than any other part of the planet. However, what is different in the Arctic is the fragility of the ecosystem balance. The growing season is short and the conditions are harsh, but the organisms are adapted to live in this environment. There’s a reason you don’t see caribou and muskox further south. We know that the ecological balance of the Arctic is already being weighed down by climate-driven changes. We know seismic exploration will exacerbate these changes. The question therefore is what are we willing to accept.”

With the EIS complete, the Department of the Interior fast-tracked the necessary postings, comment periods, and calls for site selections in order to hold a lease sale before the agency falls under new leadership on Jan. 20. Barring judicial intervention, leases will go to auction on Jan. 6. Once those are paid for and issued, they become a private property right that the federal government can’t easily dispose of. No future administration will be able to unilaterally ban drilling in the refuge because it was mandated by Congress.

“The Trump administration’s interest in rushing this forward is because once the leases are let, it makes it incredibly difficult to put that toothpaste back in the tube, so to speak,” said John Gale, conservation director for Backcountry Hunters & Anglers, one of the groups pressing both the current administration and the next one to preserve wilderness hunting and fishing opportunities in the refuge.

“All the major banks in the country have pulled any investment out whatsoever for any type of energy development in the Arctic. Wall Street saying it’s a bad idea,” Gale told MeatEater. “That means that they think that speculation on what it’s going to take to pull oil and gas resources out of there is pretty far out there and that it might be way more expensive than [energy companies] think. And even a number of oil and gas companies have expressed reticence in wanting to go after leases there. So, it’ll be interesting to see on the lease sale day, who actually buys leases and what they go for. It doesn’t make sense, it’s not something that looks profitable.”

However, Gale explained that the BLM’s leasing system allows energy developers to buy leases speculatively and then just sit on them until the situation changes. Twenty years down the line, oil prices might be higher and the federal government and American voters might be more friendly to drilling in the Arctic. Maybe.

It is also worth noting that an oil and gas lease is not a permit to drill. Any energy developer holding a lease will still need to apply for myriad permits to build roads, infrastructure, and drilling operations within the refuge—which is where the Biden administration will be able to stall the process, at least for the next four years.

“So, what they can do and what I would anticipate them doing is making the next stage of the development process incredibly difficult, creating burdens so high that no company would be interested in applying for what’s called an application for permit to drill or APD,” Gale said. “They can make the APD process so onerous and have such high standards for when they would issue a permit to drill that a company would no longer be interested. I expect something like that to happen.”

Gale said he also expects to see a conversation about buying back leases, like the conservation deals that have recently been brokered in Montana’s Badger-Two Medicine, Colorado’s Thompson Divide, and the Wyoming Range in Wyoming. The court cases already underway, and more surely to come, may find that the environmental study or other procedures were completed in error and are thus invalid. A different composition of Congress could also reverse their drilling mandate, issue a temporary or permanent mineral withdrawal for the coastal plain, or designate the area as wilderness.

“There’s a lot of options on the table for ensuring that the refuge doesn’t have any holes punched in it,” Gale said. “And I have a lot of confidence that because the incoming administration has prioritized this, that we’ll be able to stave off development there, which is going to be a long road ahead and a lot of work to do. And it’s going to require a lot of time and energy and it won’t be instant gratification for anybody.”

Still, there is time left for the outbound administration to stop the January lease sale. MeatEater’s founder Steven Rinella, who has hunted in the Arctic Refuge several times, encourages those powers that be to take a step back and consider what they are doing.

“I often wonder if the people who want to drill ANWR ever think about the future in general or their personal legacy in particular,” Rinella said. “They have a choice on how they’ll be remembered: the folks with so much greed and lust that they blemished our last greatest wilderness for profit, or the folks with so much love and vision that they saved it. Who do you think would be more celebrated by our children?”

On Jan. 6, 2021, the Department of the Interior will hold the first-ever sale for oil and natural gas leases within the boundaries of Arctic National Wildlife Refuge—exactly two weeks before the new presidential administration begins. Many hunters and anglers are anxious to know whether oil exploration will commence within the protected, northern Alaska landscape and what effects that might have on fish and wildlife.

President-elect Joe Biden has promised to permanently protect ANWR from drilling, but it is unclear what options his administration will have once leases are officially issued. Also unclear is the demand for leases during a worldwide oil glut and severely depressed prices. Accessing oil in the remote refuge will be expensive, and no one really knows how much oil is under there. Further complicating matters, all the major American banks—including Goldman Sachs, JP Morgan Chase, Wells Fargo, Citigroup, Morgan Stanley, and Bank of America—have publicly announced that they will not lend money to any ventures involved in drilling inside ANWR due to strong public opposition. A study completed by Yale University found that some 70% of Americans oppose drilling in the refuge. Several environmental groups, native tribes, and 15 states are currently suing to prevent the lease sale from happening.

The Arctic Refuge, as it is commonly known, contains 19.3 million acres of the North Slope of the Brooks Range—basically the upper righthand corner of Alaska from the last big mountains to the Arctic Ocean. It’s bordered on the west by the Dalton Highway and the oilfields of Prudhoe Bay and on the east by the Canadian border. No roads access or enter the refuge and the only settlements are two native villages, Kaktovik of the Inupiat Tribe and Arctic Village of the Gwich’in. It’s the largest wildlife refuge in the country, hosting robust (and mostly huntable) populations of caribou, moose, muskox, Dall sheep, wolves, wolverines, king eiders, ptarmigan, and all three North American bear species: black, grizzly, polar.

The area was first proposed for protection by wilderness advocates Bob Marshall, Olaus and Margaret Murie, and others, and it became a national wildlife refuge in 1960 during the administration of President Dwight Eisenhower. The modern borders were established in the 1980 Alaska National Interest Lands Conservation Act, which designated 8 million acres as wilderness but held open the door to studying the effects of energy exploration on the coastal plain at the northwest corner of the refuge. Any oil leasing would have to be authorized by Congress, and energy companies and Alaska politicians spent 40 years trying to achieve that goal in order to increase oil revenues and create jobs.

One estimate suggests that ANWR drilling authorization has been proposed in Congress nearly 50 times since 1977. In 2014 the Obama administration sought to designate the coastal plain as wilderness, but the effort failed in the legislature. In 2017, the Republican-led Senate and House included ANWR drilling in their tax overhaul, Alaska Sen. Lisa Murkowski’s long-fought ambition, and President Trump signed it into law.

The BLM then conducted an Environmental Impact Statement of the potential effects of energy exploration in the untouched landscape. That study, completed in August on a compressed timeline, suggested that seismic testing, the creation of an estimated 175 miles roads into the refuge, and building drilling pads would have minimal impacts on the ecosystem and wildlife, and the authors recommended opening the entire 1.5 million acres of the coastal plain to oil and gas leasing. The U.S. Fish & Wildlife Service, which manages the refuge, disputed the contents of that EIS, as did numerous states, congressional representatives, tribes, environmental groups, and conservation organizations—many of which are challenging the rigor of study in court. The Porcupine Caribou Herd, which complete the longest land migration of any animals on earth, birth their calves every spring in the ANWR coastal plain and could be particularly affected by energy exploration.

Stephen Klobucar, a biologist at University of Alaska, Fairbanks, and MeatEater contributor, has spent a great deal of time fishing, hunting, and studying the ecology of ANWR.

“For high arctic ecosystems to have a fighting chance moving forward, ecological and biogeochemical connections need to be maintained across the landscape. For example, caribou migrations to and from calving grounds, the timing of vegetative green-up and spring snowmelt, or the ability for arctic grayling to move between networks of river and lakes,” Klobucar said. “That’s no different than any other part of the planet. However, what is different in the Arctic is the fragility of the ecosystem balance. The growing season is short and the conditions are harsh, but the organisms are adapted to live in this environment. There’s a reason you don’t see caribou and muskox further south. We know that the ecological balance of the Arctic is already being weighed down by climate-driven changes. We know seismic exploration will exacerbate these changes. The question therefore is what are we willing to accept.”

With the EIS complete, the Department of the Interior fast-tracked the necessary postings, comment periods, and calls for site selections in order to hold a lease sale before the agency falls under new leadership on Jan. 20. Barring judicial intervention, leases will go to auction on Jan. 6. Once those are paid for and issued, they become a private property right that the federal government can’t easily dispose of. No future administration will be able to unilaterally ban drilling in the refuge because it was mandated by Congress.

“The Trump administration’s interest in rushing this forward is because once the leases are let, it makes it incredibly difficult to put that toothpaste back in the tube, so to speak,” said John Gale, conservation director for Backcountry Hunters & Anglers, one of the groups pressing both the current administration and the next one to preserve wilderness hunting and fishing opportunities in the refuge.

“All the major banks in the country have pulled any investment out whatsoever for any type of energy development in the Arctic. Wall Street saying it’s a bad idea,” Gale told MeatEater. “That means that they think that speculation on what it’s going to take to pull oil and gas resources out of there is pretty far out there and that it might be way more expensive than [energy companies] think. And even a number of oil and gas companies have expressed reticence in wanting to go after leases there. So, it’ll be interesting to see on the lease sale day, who actually buys leases and what they go for. It doesn’t make sense, it’s not something that looks profitable.”

However, Gale explained that the BLM’s leasing system allows energy developers to buy leases speculatively and then just sit on them until the situation changes. Twenty years down the line, oil prices might be higher and the federal government and American voters might be more friendly to drilling in the Arctic. Maybe.

It is also worth noting that an oil and gas lease is not a permit to drill. Any energy developer holding a lease will still need to apply for myriad permits to build roads, infrastructure, and drilling operations within the refuge—which is where the Biden administration will be able to stall the process, at least for the next four years.

“So, what they can do and what I would anticipate them doing is making the next stage of the development process incredibly difficult, creating burdens so high that no company would be interested in applying for what’s called an application for permit to drill or APD,” Gale said. “They can make the APD process so onerous and have such high standards for when they would issue a permit to drill that a company would no longer be interested. I expect something like that to happen.”

Gale said he also expects to see a conversation about buying back leases, like the conservation deals that have recently been brokered in Montana’s Badger-Two Medicine, Colorado’s Thompson Divide, and the Wyoming Range in Wyoming. The court cases already underway, and more surely to come, may find that the environmental study or other procedures were completed in error and are thus invalid. A different composition of Congress could also reverse their drilling mandate, issue a temporary or permanent mineral withdrawal for the coastal plain, or designate the area as wilderness.

“There’s a lot of options on the table for ensuring that the refuge doesn’t have any holes punched in it,” Gale said. “And I have a lot of confidence that because the incoming administration has prioritized this, that we’ll be able to stave off development there, which is going to be a long road ahead and a lot of work to do. And it’s going to require a lot of time and energy and it won’t be instant gratification for anybody.”

Still, there is time left for the outbound administration to stop the January lease sale. MeatEater’s founder Steven Rinella, who has hunted in the Arctic Refuge several times, encourages those powers that be to take a step back and consider what they are doing.

“I often wonder if the people who want to drill ANWR ever think about the future in general or their personal legacy in particular,” Rinella said. “They have a choice on how they’ll be remembered: the folks with so much greed and lust that they blemished our last greatest wilderness for profit, or the folks with so much love and vision that they saved it. Who do you think would be more celebrated by our children?”