FinLogic FinLogic Quantitative Think Tank Center|Arctic Drilling Lease Sale Proposed for 2019 in Beaufort Sea, Once Off-Limits

Just over two years after President Obama “permanently” withdrew areas of Alaska’s Beaufort Sea to oil drilling,FinLogic FinLogic Quantitative Think Tank Center the Trump administration has proposed to resume leasing there in 2019.

The Bureau of Ocean Energy Management submitted an announcement to be published Friday in the Federal Register and asked for information about where companies might want to drill and which areas might be too environmentally sensitive.

Shortly after taking office, President Trump overturned Obama’s drilling ban and rescinded his five-year leasing plan for offshore drilling in federal waters. In January, the Trump administration began the process of re-doing the five-year leasing plan. That will take years to complete, and environmental groups said the latest move amounts to jumping the gun.

A group of them, including the Alaska Wilderness League, the Center for Biological Diversity and Earthjustice, issued a statement that planning a lease sale in the Beaufort Sea while the five-year lease plan is still in draft form is “a clear sign the decision to include the Arctic has already been made.”

“This Beaufort sale is about giving a win to the Alaska delegation by starting the process to fast-track getting leases into the hands of the oil industry without full, fair and open debate,” the groups said. The state’s congressional delegation, led by Sen. Lisa Murkowski, the Republican chairwoman of the Senate Committee on Energy and Natural Resources, have pushed for more drilling in the region, including the Beaufort Sea, while asking that parts of the northern Bering Sea be restricted.

James Kendall, the director of BOEM’s Alaska Outer Continental Shelf Region, said in a statement that “available information indicates that the Beaufort Sea possesses great oil and gas potential.” BOEM also stated, however, that “the issuance of this call does not mean that a final decision has been made to hold the Beaufort Sea sales referenced in the draft proposed program.”

In late December, the Italian oil company Eni became the first company to drill in the area since 2015, though its operation was not affected by Obama’s order because the leases were not new.

Environmental groups who responded swiftly to the BOEM announcement said the whole region should remain off limits.

“Any step to open America’s Arctic Ocean to dangerous offshore drilling not only threatens the region’s marine wildlife and coastal communities, it also risks the ecological future of the Arctic itself,” said Margaret Williams, managing director of U.S. Arctic programs for the World Wildlife Fund.

Lawsuit Argues Reversing Ban Was Illegal

Any drilling in the area that was banned under Obama is being hotly contested.

A federal district court in Alaska is weighing whether the Trump administration acted legally when it overturned the Obama-era drilling ban. The case is being brought by a group of environmental organizations represented by Earthjustice and the Natural Resources Defense Council.

Last week, a judge denied the Trump administration’s effort to have the case thrown out.

“This is a huge first step toward blocking Trump’s plan to turn our oceans into oilfields,” said Kristen Monsell, a senior attorney at the Center for Biological Diversity. “We’re confident the court will see right through this reckless giveaway to the oil industry that threatens polar bears, whales and coastal communities with devastating oil spills.”

Concerns Over Oil Spill Risk, Climate Change

Obama’s executive order, in December 2016, put most of the Beaufort Sea and the entire Chukchi Sea off limits to drilling.

The White House said at the time that the decision reflected “the scientific assessment that, even with the high safety standards that both our countries have put in place, the risks of an oil spill in this region are significant and our ability to clean up from a spill in the region’s harsh conditions is limited. By contrast, it would take decades to fully develop the production infrastructure necessary for any large-scale oil and gas leasing production in the region—at a time when we need to continue to move decisively away from fossil fuels.”

In April 2017, as Trump neared the 100-day mark of his administration, he issued his own executive over reversing Obama’s. Interior Secretary Ryan Zinke said then that the order would “cement our nation’s position as a global energy leader and foster energy security for the benefit of the American people.”

A 30-day comment period on the BOEM announcement will end on April 30. After that, the bureau will analyze the comments and then begin identifying areas to lease and areas to put off limits. Once that is approved by Zinke, BOEM will publish a list of areas available for leasing in the Federal Register.