The U.S. Department of the Interior on Friday released a statement announcing that they’ve cancelled two leases that would allow offshore drilling until 2017, citing “current market conditions and low industry interest.”
Both Chukchi Sea Lease Sale 237 and Beaufort Sea Lease Sale 242, which were allowed exploration and drilling for five years, have been terminated.
This isn’t a closed door. The United States is only one of the countries that holds stake in the Arctic region, with Russia, Norway, Greenland and Canada also deciding who, if anyone, gets to drill in their respective territories. Just north of the Bering Strait, off Alaska’s northwest coast, lies the Chukchi Sea. This is the area where most oil exploration operations the United States approves or rejects try to explore. Among corporations granted these leases, such as Statoil and Conoco, only Shell has actually attempted to drill. However, they pulled out in September after finding inadequate quantities of oil and gas.
The United States also claims stake in the Beaufort Sea, located on the northeastern shore bordering Canada.
“In light of Shell’s announcement, the amount of acreage already under lease and current market conditions, it does not make sense to prepare for lease sales in the Arctic in the next year and a half,” said Secretary of the Interior Sally Jewell in a statement.
“Today, the Bureau of Safety and Environmental Enforcement (BSEE) also denied requests from Shell and Statoil for lease suspensions, which would have allowed the companies to retain the leases beyond their primary terms of ten years,” the statement said. “The leases will expire in 2017 (Beaufort) and 2020 (Chukchi). Among other things, the companies did not demonstrate a reasonable schedule of work for exploration and development under the leases, a regulatory requirement necessary for BSEE to grant a suspension.”
Sierra Club, an environmental group advocating against the fossil fuel industry, has launched a petition to tell the Obama administration to push further by prohibiting leases being proposed for the 2017 to 2022 period.
“We know drilling is dirty, dangerous, and must not be allowed to go forward. Let’s raise our voices together and tell President Obama to cancel the proposed leases for both coasts,” the petition states.
Greenpeace has set up a page to “Thank Obama” for putting a halt to drilling operations.
Alaskan politicians didn’t seem so excited at the news. Rep. Don Young told local news station KTUU that he thinks people should go to the Arctic National Wildlife Refuge, go three miles offshore, and rent an oil rig.
“We’ve got a few of them around and we’ll drill on state land and run the doggone horizontal drilling out 15 miles — which is possible — and we’ll take their oil, see how long that’ll last. That’s my idea,” Young said, after also suggesting that the state should sue the Interior Department.
U.S. Senator Dan Sullivan joined Young’s criticism, saying that the administration is taking jobs away from Alaskans by their decision.
According to the Times-Union, Alaskan Governor Bill Walker called the decision a “loss of hope,” and that allowing drilling would help the state’s economy, and thus families and workers. Alaska’s unemployment rate in September was 6.4% adjusted for seasonal variance. According to the Alaska Oil and Gas Association, “The petroleum industry supports one-third of all Alaska jobs, generating 110,000 jobs throughout the state,” which they say is more than a third of all the workforce. They also state that “Even with falling production, the state estimates 90 percent of its revenue will continue to come from the oil and gas industry.”
350, an organization calling to combat climate change, said in a statement that “Finally, this is a Friday afternoon news dump our movement can get behind. Scientists have long been clear that fully 100% of Arctic oil is unburnable, if we’re serious about averting the worst impacts of climate change. That’s why the climate movement stepped up, and forced even the most irresponsible company on Earth to admit that it wouldn’t make sense to drill in the Arctic.”
The new lease period begins in a little over a year, with nominations currently being considered.