Clinton to OK More Oil Drilling in Alaska Wilds

The Clinton administration said Thursday that it will open 4 million acres of pristine wetlands and river valleys along Alaska’s vast North Slope to new oil production, the biggest expansion of Arctic oil development in decades.

In a proposal tailored to protect what Interior Secretary Bruce Babbitt called “the last great intact commons in all of the United States of America,” the Bureau of Land Management released a plan that would allow drilling on 87% of the northeast quadrant of Alaska’s National Petroleum Reserve, the huge plain of undeveloped tundra west of the Prudhoe Bay and Kuparuk oil fields.

The move--an attempt to plumb new domestic oil sources at a time when Alaska’s fabled tap is slowing--clearly was targeted to hold at bay calls for development of the even more environmentally sensitive lands farther to the east, in the Arctic National Wildlife Refuge.

Babbitt, in announcing the department’s preferred alternative for the petroleum reserve, called again for a ban on any oil exploration activities in the refuge and urged Congress to impose stronger protections on those areas that the department proposes to exclude from oil development.

“There should be some places on this planet where we do not take risks, where we have said there’s enough space to set aside places that are exclusively for the use of God’s creation, without interference from us,” Babbitt said.

“I’m not saying this is a risk-free plan. I’m saying that in the eternal process of trying to reconcile contrasting values, I believe that we have carried the process of land use and resource and biological planning to a new level of sophistication,” he said.

The 23 million acre National Petroleum Reserve in Alaska, set aside in 1923 as a petroleum reserve for the Navy, is the nation’s largest expanse of undeveloped public land.

The plan announced Thursday opens the door to only about two-thirds of the area most sought after by the oil industry, protecting critical wildlife areas around Teshekpuk Lake and the bluffs of the majestic Colville River, the biggest river in the U.S. Arctic, as well as four tributary river corridors.

Ironically, some of the most significant suspected oil reserves are in the vicinity of the treeless, icy lake, a 36-square-mile sinkhole in the tundra that is the only molting habitat of its kind for millions of migratory waterfowl that ply the Pacific coast.

The preferred alternative in the environmental impact statement released Thursday protects the lake, but allows subsurface access to a six-mile buffer zone around it by way of new slant-drilling techniques. New roads to access drilling sites are prohibited, except for temporary ice roads constructed during winter.

And while the plan stops short of proposing federal Wild and Scenic River protection for the Colville, it prohibits drilling activity on the ancient river bluffs, home to the highest density of breeding peregrine, gyrfalcon and rough-legged hawks in the world.

A cluster of deep-water lakes whose fish provide subsistence for native Inupiat villagers would be off limits as well.

But conservation groups said any drilling, at a time when the world is awash in cheap oil, represents a fatal and unnecessary compromise. And they predicted that opening the petroleum reserve to oil production will not, in the end, save the Arctic wildlife refuge.

“I think compromising with the oil industry in the state of Alaska is like climbing into a lifeboat with a cannibal,” said Allen Smith, the Wilderness Society’s Alaska representative. “They want it all, eventually. They will not concede there are places they should not go.”

Reaction from the oil industry was decidedly muted, with widespread disappointment with the proposal’s stringent environmental conditions and drilling limits that will preclude extraction on as much as a third of the richest reserves.

“We’re pleased that the proposal calls for leasing, but we’re frankly disappointed,” said Paul Laird, spokesman for British Petroleum Exploration Alaska Inc.

“It seems like a significant amount of what the industry considers to be the most prospective acreage . . . has either been put off limits or it has restrictions attached to it that, in many cases, will make it hard for us to conduct 3-D seismic work to evaluate potential, harder for us to drill to verify potential and nearly impossible in some cases to develop,” Laird said.

Kevin Meyers, president of Arco Alaska Inc., said new technology wells capable of penetrating the six-mile buffer around Teshekpuk Lake can cost upward of $10 million. In effect, he said, it will mean the industry will not pursue portions of the oil field whose development costs are driven up by the restrictions.

Babbitt emphasized that he will oppose any attempt to fragment the huge reserve, which he compared to the wide-ranging commons of the American Plains of a century ago, destroyed as a home to the buffalo when parceled out for development.

The 26,000 caribou of the Teshekpuk herd could face a similar demise, and “we must not allow that to happen,” Babbitt said.

U.S. officials said the national reserve could produce anywhere from 500 million barrels to 2.2 billion barrels of oil. Production could be expected to generate $16.5 million a year in taxes and royalties and create about 500 new jobs.

Assuming final adoption of the environmental report later this year, the first tracts could be put out to bid in mid-1999, with the first oil pumped a decade from now.

The original Prudhoe Bay oil field that launched the boom on the North Slope is laced with wells, pipelines, roads and production facilities. Impacts on migrating caribou and other wildlife have been unmistakable.

But industry officials say the latest production ventures farther out on the slope have minimized the oil footprint, extracting crude diagonally out of a wide area from a single rig location, constructing drilling pads one-tenth of the size they used to be, accessing rigs via helicopter and winter ice roads and locating pipelines with careful attention to wildlife migratory routes and minimal disruption to waterways.

“We can explore in the winter with no impact on the habitat and the environment. We do our drilling off of ice pads, and in the spring when the ice thaws, you cannot tell we were there,” Meyers said.

Previous tentative attempts to lease tracts in the National Petroleum Reserve during the 1980s produced no serious bidders, largely because there wasn’t enough oil to interest anyone, and existing North Slope fields were still gushing. Newer technology has allowed oil companies to generate more profit from smaller fields, however. And when Arco in 1996 struck 365 million barrels of oil on its Alpine site, 60 miles west of Prudhoe Bay on the edge of the reserve, interest in probing farther west mounted.

Alaska, heavily dependent on North Slope oil to fuel its budget, has pushed to expand oil development outside the central slope, and Democratic Gov. Tony Knowles was instrumental in persuading President Clinton to embark on the current leasing plan within 4.6 million acres of the reserve.

Environmental groups have urged the government to hold off on leasing any of the reserve at a time when oil supplies are cheap and plentiful.

“Wilderness is precious and increasingly rare. Oil is also finite, although it is cheap and abundant today. This hasty election-year scheme squanders our nation’s wilderness and oil and does nothing to conserve either,” said Sylvia Ward of the Northern Alaska Environmental Center.

Babbitt acknowledged fears that even limited drilling could open the way for wholesale industrialization of the western Arctic plain.

“I understand what you’re saying,” he told conservation groups. “You’re saying, with considerable justification, that the history of resource development says that once the camel’s nose is in the tent, you can say goodbye to the tent, the landscape, the whole thing.

“But I invite you to consider that we are, in fact, offering a new approach, anchored not in some kind of brokered compromise, not based on some kind of notion of what’s acceptable or what’s practical,” he said. “This plan is based on science, and it in fact offers a new approach to how it is we use resources.”