Resource Development Council

From The Deputy Director - Carl Portman

Alaskans pack hearing to support Lease Sale 193

Alaskans from all walks of life and far corners of the state spoke out in force Tuesday, November 9 in support of oil and gas development in Alaska’s Outer Continental Shelf. They came to a public hearing in Anchorage, hosted by the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM), with a sense of urgency, presenting compelling testimony in favor of affirming Lease Sale 193.

Alaskans demonstrated how much they care about their state’s economic future and the confidence they have in the safe and responsible development of the potentially enormous oil and gas resources in the Chukchi Sea. The hearing room was packed and when the meeting ended at 10 p.m., there were at least 35 waiting to testify. Some, like former RDC President John Shively, stood along a crowded wall for three hours waiting for their turn to comment.

Two-thirds of those attending wanted to put the agency on notice that they are not going to sit back any longer as endless litigation, delays, and gridlock stymie future development. With ANWR off the table indefinitely and future development in the National Petroleum Reserve-Alaska in limbo, they see the Alaska OCS as perhaps the last opportunity to reverse the decline in North Slope production. They understand that the sustainability of the Alaska economy will depend on some combination of oil and gas production from these federal areas, which represent the nation’s best onshore and offshore prospects.

The meeting was held to hear public comments on the Draft Supplemental Environmental Impact Statement (SEIS) for Chukchi Sea Lease Sale 193 held in February 2008. The SEIS provided new analysis as directed by the U.S. District Court for Alaska in a July 2010 order. The SEIS concluded with a recommendation that the sale be affirmed.

Lease Sale 193 is the most successful oil and gas lease sale in Alaska’s history, generating $2.7 billion in high bids for 487 leases. The time required to get from lease sale to first production is estimated to be 20 years, yet to date, not one exploratory well associated with the sale has been drilled.

The Alaska OCS could hold up to 29 billion barrels of oil and 209 trillion cubic feet of natural gas. In comparison, total North Slope production from state lands over the past 33 years has totaled 16 billion barrels. Access to the federal resources is critical, given TAPS is running at one-third of its 1988 peak and could be uneconomic to operate after 2020 without additional throughput. At that point, the state could lose 90 percent of its revenue base and much of its economy if the pipeline is forced to shut down prematurely.

It was very apparent Alaskans attending the hearing care deeply about the state’s future economy and environment. Two especially compelling testimonies came from residents of Wainwright and Barrow. Both residents stated how important oil revenues are to their communities. Oil revenues, they said, provide jobs in the community, but also fund many infrastructure projects, including schools, roads, community buildings, and the very basic necessities.

Environmentalists responded by claiming a time-out is needed to conduct more studies. Others countered that Alaska’s North Slope and OCS are now perhaps the most studied energy basins in the U.S. In the past decade alone, over 250 studies have been funded, with the majority focused on the Beaufort and Chukchi Seas. Over a half billion dollars have been spent on more than 5,000 independent studies since 1973. Leases issued under Lease Sale 193 were sold only after an exhaustive environmental analysis.

Others emphasized: 1) Alaska depends on energy production for the bulk of its economy; 2) The nation will import all the oil it does not produce domestically; 3) America continues to expand its percentage of imported oil; 4) the OCS can sustain Alaska’s economy for generations, creating 35,000 new jobs.

Shell has spent $3.5 billion in pursuit of an Arctic exploration program and is ready to commit billions more. Yet Shell waits upon an Administration to establish an Arctic policy to allow the permitting process to proceed, and it waits upon the courts to review an endless barrage of litigation.

Others urged the Obama administration to move forward, expressing concern that the permitting process and incessant litigation are chasing American industries overseas and slowly sinking the American economy, while other nations benefit from our inactions and anti-business policies.

The latest comment period served as yet another bite at the apple, another opportunity to delay. However, Alaskans, both blue and white collar, union and non-union, refused to let Cheers-famed Ted Danson speak for them. Danson, who was billed by the media as the top attraction at the hearing, spoke in opposition to OCS development, urging more studies and delay. But despite the media coverage, which prominently highlighted Danson’s views, Alaskans were the top attraction at this hearing.

The North Slope Borough, which did not testify at the hearing, has expressed a number of concerns about OCS development. RDC understands local concerns, but believes they can be addressed by effective mitigation measures. Moreover, Shell has committed to unprecedented provisions for prevention and spill response that go beyond what is required by law. These provisions give RDC a high level of confidence that development can occur safely.

RDC would like to acknowledge the efforts of RDC board member Ron McPheters for getting the union voice on record in support of OCS development. Specifically, we would also like to thank the following who offered testimony: Tom and Sam Maloney, Len Horst, John Shively, Dave Chaput, Paula Easley, Jeanine St. John, Maynard Tapp, Rebecca Logan, Joe Hegna, Jim Udelhoven, Stacy Schubert, Kate Williams, Dave Harbour, Sami Glascott, Vince Beltrami, Barbara Huff, Kurt Jackson, Keith Silver, Rep. Craig Johnson, Rep. Bill Stoltze, Senator-elect Cathy Giessel, Kevin Banks, Christine Klein, Chris Warren, Aves Thompson, Jeff Jones, and others.

Alaska has a bright future and has much to contribute to the nation with its abundant resources. All that is required are policies and key decisions encouraging development of these resources. Nothing less than Alaska’s economy is at stake.

The comment deadline is November 30. We encourage all of our members to submit comments. Please see the RDC Action Alert at for details.

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