Legislature readies complaint after Arctic drilling nixed

The Alaska Legislature is preparing an official complaint letter to President Barack Obama after the federal government canceled planned oil and gas lease sales in the Arctic Ocean.

On Saturday, the Alaska Senate Resources Committee met to consider House Joint Resolution 301, a document that states in part that the Legislature “opposes the recent decisions of the Obama Administration to cancel future lease sales in the Chukchi and the Beaufort seas and to deny the suspension of Shell and Statoil’s leases.”

The letter comes as the Legislature considers the future of the AKLNG natural gas project, whose economic grounds are based in part on the future availability of natural gas from offshore sources. Oil from wells drilled in federal waters is also expected to extend the life of the trans-Alaska oil pipeline.

Kara Moriarty of the Alaska Oil and Gas Association was one of two people to offer public comment in support of the letter on Saturday and explained that the federal waters of the outer continental shelf are believed to have average reserves “of about 27 billion barrels of oil and 132 trillion cubic feet of natural gas.”

She said Royal Dutch Shell’s recent abandonment of its exploratory well in the Chukchi Sea — after spending more than $7 billion to develop it — is not a sign that the Arctic is too difficult or lacks energy.

“Just because Shell did not have a commercial discovery … doesn’t mean there’s not interest in the offshore, and it doesn’t mean those 27 billion barrels (of oil) and 132 trillion cubic feet (of gas) are not there,” Moriarty said.

She added that the cancellation of the leases is an example “once again where the state is better than the federal government.”

Also offering support was Barbara Huff Tuckness, a spokeswoman for Teamsters Union Local 959.

The Resources Committee is expected to rapidly approve the letter of complaint, which has no binding power on the federal government.

Sen. Bert Stedman, R-Sitka, said the federal government should be considering the fact that Arctic development will go forward regardless of what the United States does.

“Our neighbors are going to develop their offshore with or without us,” he said. “I have much more confidence in the American technology and regulatory environment than I do China’s.”

After its expected approval by the Senate Resources Committee, the resolution would be subject to a vote of the full Senate and be referred to the House, where it may be subject to committee approval before being voted on by the full House and becoming effective.

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