On Friday, the US Interior Department announced that they would be canceling lease sales for oil companies – such as BP, Exxon, and others – that are seeking to drill in Alaskan waters.
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In a statement, Sally Jewel said that in light of Shell’s announcement regarding amount of acreage under lease and poor market conditions, it does not makes sense for making lease sales in future. The company’s exploratory well found oil and gas but not in quantities that justified the huge expense of Arctic drilling, where Shell backed up its rigs with a flotilla of support and safety vessels and made regular helicopter flights from a staging area 150 miles away in Barrow, the country’s northernmost community.
The move has been welcomed by environmental groups, who had pressured Shell to halt drilling in the pristine environment of the Arctic.
The United States government has cancelled plans to allow oil drilling along the Arctic coasts of Alaska for the next two years, the Interior Department announced. The agency said it received no industry interest in a Chukchi Sea lease sale scheduled for next year and one response to its call for nominations for a Beaufort Sea lease sale that was to be held in 2017. Shell said it was stopping exploration “for the foreseeable future” because of the disappointing results and the uncertain federal regulatory environment.
The sales canceled involved one lease in the Chukchi Sea and another in the Beaufort Sea, to the northwest and north of Alaska, respectively.
The decision reflects current market conditions and low industry interest, Jewell said in a news release. Alaska Gov. Bill Walker visited said the decision left him feeling with sort of a “loss of hope, in a few respects, that we’re going to be able to have access to more oil in the pipeline”. They also said burning Arctic Ocean oil would accelerate global warming.
“This is great for the Arctic and its polar bears”, Sakashita said. Democratic presidential front-runner Hillary Clinton has expressed opposition to drilling in the Arctic Ocean, while Republican candidates have either supported the drilling or not taken positions.
Sen. Dan Sullivan, R-Alaska, said President Barack Obama’s administration is correct in wanting to help Alaska Natives and all Alaskans battle the state’s high rates of suicide, domestic violence and addiction. It can’t stop here though: “It’s time to take the next step and pledge to keep this oil in the ground and transition quickly to energy sources that are safer, smarter and better for all of us”.
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Shell is also concerned with the decision, in particular the impact it will have on their ability to make new explorations in Arctic waters, should they choose to do so.
