Resource Development Council

RDC Comment Letter:
Alaska Outer Continental Shelf Lease Sales

March 18, 2009

John Goll, Regional Director
Alaska OCS Region
U.S. Minerals Management Service
3801 Centerpoint Drive, Suite 500
Anchorage, AK 99503-5820

Dear Mr. Goll:

The Resource Development Council (RDC) appreciates the opportunity to submit comments on the proposed Chukchi and Beaufort seas lease sales (209, 212, 217 and 221).

RDC is a statewide, non-profit, membership-funded organization founded in 1975.  The RDC membership is comprised of individuals and companies from Alaska’s oil and gas, mining, timber, tourism, and fisheries industries, as well as Alaska Native corporations, local communities, organized labor, and industry support firms.  RDC’s purpose is to link these diverse interests together to encourage a strong, diversified private sector in Alaska and expand the state’s economic base through the responsible development of our natural resources.

RDC is confident oil and gas production from the Chukchi and Beaufort can move forward in an environmentally-sensitive and responsible manner through a strong regulatory regime, seasonal operating restrictions as needed, and mitigation measures to avoid conflicts with other resource users. OCS development has an outstanding safety and environmental record spanning decades. Development has coexisted with other industries, including fishing, in the North Sea, the Gulf of Mexico and Cook Inlet.

OCS production in Alaska would provide many benefits, including hundreds of new jobs in rural and urban areas, additional tax income to the state and local governments, new local sources of fuel and energy, and improved search and rescue operations.

Any energy plan for the nation should include Alaska’s Outer Continental Shelf (OCS), given its potential for immense recoverable oil and gas reserves. Responsible development of Alaska’s offshore energy resources would help meet future U.S. energy demand and offset declining production from mature basins in the U.S. and Canada.

RDC urges the Minerals Management Service to maintain regular lease sales in the Beaufort and Chukchi seas, including but not limited to sales 209, 212, 217 and 221. Given the long lead times for development, which can exceed ten years, MMS must proceed with key lease sales. Otherwise, production from new areas could be pushed back decades.

Such delays could potentially jeopardize the proposed natural gas pipeline from the North Slope to the Lower 48. Access to the Alaska OCS may be a key element to the long-term economic feasibility of the pipeline. To become a reality, the pipeline requires additional gas reserves beyond what has already been discovered. The Chukchi Sea is considered to be the nation’s most prolific, unexplored offshore basin in North America with potential reserves of 132 trillion cubic feet of natural gas.

RDC recognizes that subsistence whaling is vitally important, both economically and culturally to North Slope villages. We believe seasonal restrictions and/or deferrals of specific tracts in active whaling waters should be considered to avoid potential conflicts, as opposed to outright cancellation or indefinite deferral of entire lease sales.

To help address local impacts, RDC also encourages the federal government to share revenues from OCS activity with local communities. 

OCS production in Alaska would provide many benefits, including hundreds of new jobs in rural and urban areas, additional tax income to the state and local governments, new local sources of fuel and energy, and improved search and rescue operations.

As the Obama administration considers a new direction in energy policy, the Alaskan OCS must be a part of the solution. While the administration will be pressed by some interests to sharply curtail development of fossil fuels, the need for energy will continue to rise and demand will require continued development of America’s oil and gas resources, even as the nation transitions to the new energy sources of the future. While renewable energy will make up a growing part of the U.S. energy portfolio, it will not significantly reduce our reliance on foreign sources of oil in the near or mid-term. In 20 years, conventional sources such as oil, gas and coal, are projected to account for at least 80 percent of the energy consumed in America – even with major strides forward in renewable and alternative energy production between now and then. As a result, the health of our economy and our national security will require utilization of both conventional and unconventional energy sources. No single approach is enough as we cannot drill our way to energy independence, nor can we conserve our way.

With the impact high-energy prices have on Americans and their economy, the U.S. has a moral obligation to develop domestic energy sources, both conventional and unconventional. These resources will buy us the time we need to develop the alternative and renewable energy resources that will someday break our reliance on foreign oil.

RDC applauds Interior Secretary Ken Salazar for seeking a new path forward for onshore and offshore renewable energy projects. We support inclusion of such projects in a comprehensive energy plan. However, in our view, a comprehensive energy plan should not only include “more” renewable and alternative energy, but also “more” conventional domestic energy production if America is to significantly reduce its reliance on foreign oil over the next 20 years.  Increased emphasis on renewable and alternative energy should not preclude or require less oil and gas development. America needs more of both.

Given the nation will remain heavily reliant on oil and gas development for decades, America must harness the significant energy resources beneath its most promising onshore and offshore oil and gas basins. Otherwise, for every barrel of oil America refuses to develop domestically, it will have little choice but to import an equal amount from overseas – where weaker environmental regulations often apply.

Thank you for the opportunity to comment on the proposed lease sales.


For Alaska, Inc.

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