Monday, May 23, 2022

Big Oil Comes Out of Trump’s Latest US Drill Auction | Climate news

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The big oil companies avoided the sale, which was an unprecedented move by incumbent US President Donald Trump.

The Trump administration’s unprecedented auction of Arctic drilling rights on Wednesday brought in just $ 14.4 million to three bidders, as major oil companies avoided the sale.

Amid low crude prices, fears of a public backlash, and the prospect of regulatory uncertainty, only two oil companies have made offers on leases in the coastal plain of the Arctic National Wildlife Refuge: Knik Arm Services LLC and Regenerate Alaska Inc. Alaska Industrial Development and Export Authority, a state-owned economic development company that approved $ 20 million spending on coastal lowland leases last month, but never led a project to oil exploration.

The offers have been provisionally delivered on 11 leases covering approximately 553,000 acres (223,791 hectares), the Bureau of Land Management said.

“I hope that if and when commercial quantities of oil are discovered on any of these leases, this action will make history for generations to come,” generating well-paying jobs, royalties and new sources of crude , said the deputy of the Interior. Secretary Kate MacGregor.

Attendees have raised hundreds of thousands of dollars to find leases they might never use, given President-elect Joe Biden’s vow to permanently protect the refuge. While Biden has little power to revoke leases once they are issued, the incoming administration has more leeway to block permits essential to mounting any activity on the leaflets.

“Today’s lease sale was the logical conclusion to this completely flawed effort: a massive failure,” said Jenny Rowland-Shea, senior policy analyst for public lands at the Center for American Progress. “The Trump administration has succeeded in ripping off taxpayers, ignoring Gwich’in rights and voices, and threatening polar bears and caribou, all to hand the coastal plain over to a few savages and a crown corporation without being able to pierce. “

The arctic refuge in northeast Alaska was once considered prime land for petroleum development, given the potential for massive reserves of conventional crude that could elapse for decades. But companies once seen as potential bidders for Arctic acreage have cut spending this year as the coronavirus pandemic has eroded demand and prices for crude.

Environmentalists and Alaskans, including the Gwich’in who consider the area sacred, had also warned oil companies they would face public prosecution for exercising drilling rights on the coastal plains. They mounted legal challenges to the Home Office auction, which are still pending, arguing that industrial oil development would threaten one of America’s last truly wild places, along with calving caribou. , migratory birds and arctic foxes that depend on them.

Congress mandated two auctions of Coastal Plain oil by December 22, 2024, as a way to pay off the 2017 tax cuts, based on predictions that lease sales and oil development would generate over $ 2 billion in revenue over a decade.

Bidders in Wednesday’s sale were required to bid at least $ 25 an acre. With plots ranging from 23,446 to 59,410 acres (9,488 to 24,042 hectares), the smallest possible winning bid is $ 586,150.

The Bureau of Land Management had yet to recap the final results by mid-afternoon on Wednesday. But Knik registered an offer of $ 1.6 million for one plot, Regenerate Alaska pledged $ 771,000 for one plot, and the Alaska Industrial Development and Export Authority spent $ 12 million for the rest of the territory.

Although the state-owned company has funded small oil projects in Alaska, it has never sought to acquire its own drilling rights, and the Bureau of Land Management has previously disqualified offers from entities with no intention to develop their leases. .

The leases themselves do not authorize drilling; separate permits are required. And even the auction results will not be final immediately. Winning bids must be considered as part of a government review process that typically takes months, although Trump administration officials are rushing to officially issue the leases before Biden is sworn in on January 20.



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