Page 5 - NorthAmOil Week 17 2022
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NorthAmOil COMMENTARY NorthAmOil
a change in course under the incoming Biden be offset by higher oil prices boosting activity
administration kept some producers from bid- elsewhere in the state.
ding in the lease sale. However, there were also Nonetheless, the move has come under fire
other factors to consider, including a broader from supporters of increased US oil and gas
shift in focus from more challenging regions production against the backdrop of new global
such as Alaska to shale plays in the Lower 48 energy security concerns in the wake of the
states. It is also worth noting that lease sales Ukraine war. Among them was US Senator for
held by the Trump administration in other Alaska Dan Sullivan, who accused Biden of not
regions, including the US Gulf of Mexico, were doing everything he can to ease gasoline prices
also characterised by fairly muted interest from by blocking potential oil production from part
producers as they sought to maximise output of the NPR-A.
from existing operations ahead of committing Meanwhile, Alaska’s producers are grap-
to new drilling. pling with various other issues specific to their
As producers in Alaska had anticipated, Biden projects. For example, ConocoPhillips is hav- According
reversed course on Trump’s move to open up the ing to undergo a new regulatory review for its
ANWR to drilling, quickly imposing a morato- planned Willow project in the NPR-A after a to the BLM’s
rium on leasing in the refuge and subsequently federal judge voided the original environmental announcement,
suspending existing leases there in June 2021. approval for the project last year.
Now, the Biden administration is taking steps ConocoPhillips also finds itself being scruti- the NPR-A will
to reverse course on Trump’s policy to open up nised over a recent natural gas leak at its Alpine
more of the NPR-A to oil and gas activity as well. field, which has led to Democrat lawmakers now revert to
According to the BLM’s announcement, the raising concerns over how the company would
NPR-A will now revert to being managed under respond if a similar incident occurred at Willow. being managed
the 2013 IAP, while certain measures from the Separately, Oil Search, which was taken over under the 2013
2020 IAP aimed at protecting endangered wild- by Australia’s Santos late last year, is running
life will be incorporated into the plan. Leasing into complications at its planned Pikka project IAP.
and drilling will be restricted to around half of owing to a dispute with ConocoPhillips over
the reserve, which spans 23mn acres (93,078 road access. (See NorthAmOil Week 16) Santos
square km) in total. has maintained that the dispute does not affect
its plans for Pikka – which includes potentially
What next? selling its entire 51% stake in the project. But
The move to restrict leasing in the NPR-A rep- these examples and others illustrate that on both
resents one further obstacle for Alaska’s produc- the individual project and broader policy levels,
ers to contend with, though some analysts have there are considerable challenges to navigate for
downplayed its impact, saying they expect it to Alaska’s producers.
Week 17 28•April•2022 www. NEWSBASE .com P5