Federal Government Throws Alaskans Under the Bus, Again

October 21, 2015 in Blog

As local Alaskans are still reeling from Shell’s decision to withdraw from the Arctic, they received another blow late last Friday from the federal government when the Department of the Interior (DOI) cancelled the Arctic offshore lease sales originally scheduled for 2016 and 2017, effectively blocking future oil and gas exploration and development in the U.S. Arctic.

After burdensome regulations imposed by the federal government led Shell to suspend its Arctic drilling program, devastated Alaskans, elected officials, and Members of Congress called Shell’s decision “a major blow,” “a big loss,” “a punch in the gut,” and “a very sad day for Alaska and for working Alaskans and Americans across the country.”

After DOI announced its decision to close off the Arctic to energy exploration, Alaskans reacted with outrage, disappointment, and sorrow to what they perceived to be yet another attack on them, their economy, and their livelihoods by the federal government.

Gov. Bill Walker (I-AK) was “disappointed” about DOI’s decision, lamenting that decisions to limit oil development in Alaska would create “unnecessary uncertainty and burden on our economy”:

“I am disappointed by this announcement. Alaska must be able to responsibly explore and develop our rich natural resources both onshore and offshore. Any action that limits our ability to explore for more oil—to increase much-needed oil production through the Trans-Alaska Oil Pipeline—creates unnecessary uncertainty and burden on our economy.”

Senator Lisa Murkowski (R-AK) called DOI’s decision a “stunning, short-sighted move” that was the “latest in a destructive pattern of hostility toward energy production” in Alaska:

“This is a stunning, short-sighted move that betrays the Interior Department’s commitments to Alaska and the best interests of our nation’s long-term energy security. Today’s decision is the latest in a destructive pattern of hostility toward energy production in our state that began the first day this administration took office, and continued ever since.

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It is absurd that Interior has created a regulatory environment where operators cannot have commercially viable exploration programs, because so many requirements and hurdles have been put in place, and then blames them for not moving forward. There is not a lack of interest in the Arctic – if anything, what we are seeing is a lack of interest in working with the current leadership of the Interior Department.”

Senator Murkowski also said,

“So if you’re an Alaskan and you’re reading the headlines, you have to wonder, what’s going on within Interior? Why do they have it out for us?”

Senator Dan Sullivan (R-AK) emphasized that DOI’s decision, by taking thousands of jobs off the table, would exacerbate social problems in Alaska:

“They just took real opportunity, significant opportunities that could benefit thousands if not tens of thousands of Alaskans off the table. … That’s not going to help the social problems. That’s actually going to make them worse.”

Rep. Don Young (R-AK) said the DOI threw Alaska a “cinder block” instead of a lifeline:

“This Administration continues to say they are committed to a balanced approach to resource development, but Alaskans are seeing that this is a falsehood.  A five year plan was put on the table in vain, only to later take off the table vast swaths of the most desirable and economically feasible offshore areas.  Further, their regulatory actions have not created security to invest in Alaska – they have scared off investment at the expense of the Alaskan people.  When you do not offer up a valuable product, or create surety for the investment, it will not attract investors.  This is a basic concept that cannot be dismissed as lack of interest from industry.

To add insult to injury, the Administration will not entertain conversations to extend the existing leases for those that have made investments in the Beaufort and Chukchi.  Instead of throwing a lifeline to the State, they throw us a cinder block.”

Alaska House Speaker Mike Chenault (R) said DOI’s decisions were made by “patronizing bureaucrats deciding for the market and crippling our economic [sic], harming our future.”

Crawford Patkotak, Chairman of the Board of the Arctic Slope Regional Corporation, which represents 11,000 Native Alaskan shareholders, said DOI’s announcement was another step

“by the current administration to put us back to poverty and cut our legs out from under us as we try to live the American dream and provide opportunity for our people.”

Kara Moriarty of the Alaska Oil and Gas Association said DOI’s decision would make it “much more difficult” for Arctic residents to develop critical infrastructure:

“With this decision, President Obama and his team are finally showing their true colors on resource development in the Arctic; obviously, the president has no desire to see Shell succeed in Alaska, and does not want to see any new companies succeed, either.

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The reality is that now, as Russia and other Arctic nations begin to develop their respective natural resources, we will lack the emergency response capacity that would have inevitably have resulted from our own Arctic activity. The opportunity for Arctic residents to develop ports, search and rescue operations, and infrastructure is now much more difficult without the massive investment necessary to develop Arctic resources.”

Finally, a California-based representative for activist group Center for Biological Diversity praised DOI’s announcement: “This is great for the Arctic and its polar bears.” But for the people who live and work in Alaska? Not so much.