The People of America's Oil and Natural Gas Indusry

Turning Alaska Reserve’s Energy Potential to Reality

Mark Green

Mark Green
Posted October 26, 2015

A couple of reactions to last week’s Bureau of Land Management (BLM) approval of drilling in the National Petroleum Reserve-Alaska (NPR-A)  – which we’ll link to a larger conversation about the Obama administration’s oil and natural gas policies.

First, it’s good that BLM has cleared the way for ConocoPhillips to move forward with a $900 million project that includes construction of an 11.8-acre drilling pad in the 23 million-acre NPR-A. The Greater Mooses Tooth Unit (GMT1) project could host up to 33 wells and could reach a monthly production peak of 30,000 barrels per day. America needs the energy, and producing oil from the vast reserve that was originally set aside for energy development almost a century ago is a welcome step. ConocoPhillips’ Natalie Lowman:

“It’s good news. We’re pleased they issued the permit and the right-of-way and now we’re seeking a funding decision.”

BLM approving this one drilling permit prompts another set of reactions, starting with: It’s about time. And: What about energy development in the rest of the oil reserve?

NPRA

The NPR-A approval has been a long time coming. ConocoPhillips first proposed GMT1 in 2002. Permits were submitted in July 2013 and various approvals have come in since. While the reserve has seen a number of exploratory wells, the GMT1 project would make way for the first production and transportation of oil to the Trans-Alaska Pipeline from federal lands in the reserve, BLM said.

Unfortunately, it has taken nearly a century to reach the start of actual production from this dedicated oil and gas reserve. Also unfortunate is that in 2013 the administration elected to cordon off more than half of NPR-A from energy development altogether.

So, we have a vast energy-dedicated reserve that remains, essentially, millions and millions of acres of potential because the majority of it is off limits by a federal policy – a policy that makes little sense given the energy realities of today and tomorrow. U.S. Sen. Lisa Murkowski of Alaska, as reported by The Hill:

“Approval to drill the GMT-1 project is good news for Alaska and our native Corporations who will benefit from the 7(i) revenues from this project,” Sen. Lisa Murkowski (R-Alaska), chairwoman of the Senate Energy and Natural Resources Committee, said in a statement. “But this announcement marks yet another example of the tortured path Alaskans have been forced to navigate to develop on federal lands in our state,” she said.

Federal policy isn’t the only reason NPR-A hasn’t been developed to this point, but it’s one of the main reasons. The administration’s handling of NPR-A reflects a mindset that’s stuck in the era of domestic energy scarcity that preceded the ongoing U.S. energy revolution.

This mindset is creating an incoherent energy policy. As noted in a post last week, the administration often gives the appearances of supporting oil and natural gas development but its leasing and permitting policies mean development faces one hurdle after another, limiting actual access to energy on federal lands, onshore and offshore.  

This also is seen in the White House threat to veto legislation that would lift the 1970s-era ban on U.S. crude oil exports. This, despite the fact that every major study has concluded that oil exports would stimulate domestic production, create jobs and boost the economy while giving the United States greater ability to balance and stabilize energy markets and help allies overseas.

America’s energy future depends on developing the right energy policies for the future – policies that acknowledge the country’s resource potential and the historic opportunity to strengthen our economy and our security in the world. We need policies that look forward, not back, and leadership that views America’s energy potential as an opportunity to be harnessed, not a challenge. API President and CEO Jack Gerard:

“The energy policy choices we make today will impact our nation’s consumers in the future. Consumers need more energy and more efficiencies, not less. We are in the midst of an energy renaissance in which America has an abundance of energy. We can be self-sufficient, and a global leader helping our allies across the globe. … [We] encourage policy makers to continue down the path we have shown to work, supplying abundant, affordable, and reliable energy to consumers while lowering our impact on the environment.”


ABOUT THE AUTHOR

Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.