Pro-oil officials hope Trump can ‘trump’ Obama’s Arctic drilling ban

Alaskan officials and NOIA President have responded with outrage to the ’11th hour’ Arctic and the Atlantic Ocean oil and gas ban put in place by outgoing President of the United States, Barack Obama.

Following U.S. President Barack Obama’s withdrawal of millions of acres in the Arctic and the Atlantic Ocean from future oil and gas activity, negative reactions from pro-oil and gas officials immediately ensued.

Randall Luthi, president of the National Ocean Industries Association (NOIA), and Alaskan Senators Lisa Murkowski, Dan Sullivan, and Congressman Don Young responded fiercely.

In his Tuesday statement regarding the topic, Luthi slammed Obama’s “short-sighted unilateral withdrawal of Atlantic and Arctic Ocean areas from future oil and gas leasing not only risks the long-term energy security and energy leadership position of the United States, but it also violates the letter and spirit of the law.

“Such an expansive withdrawal, particularly when argued as being ’permanent’, is clearly inconsistent with the Outer Continental Shelf Land Act’s steadfast declaration that ‘… the Outer Continental Shelf is a vital national resource reserve held by the Federal Government for the public, which should be made available for expeditious and orderly development, subject to environmental safeguards, in a manner which is consistent with the maintenance of competition and other national needs …’

“We are hopeful that the incoming Trump administration can repair some of the damage done to the offshore energy industry and America’s energy security over the past eight years by putting policies in place that increase, rather than decrease, access to federal offshore areas.”

Luthi also said that such a decision by the Obama administration put the U.S. at a competitive disadvantage and sacrificed thousands of potential jobs and billions of dollars in government revenue and that the ban ignored the projected global energy demand increase which would mostly be covered by fossil fuels.

Ban ‘reckless and short-sighted’

The Alaskan trio of Senator Lisa Murkowski, Senator Dan Sullivan, and Congressman Don Young also slammed President Obama for unilaterally placing the entire Chukchi Sea and the vast majority of the Beaufort Sea off-limits to energy development.

They claim that the withdrawal disrespects the Alaskan people, is not based on sound science, and contradicts the administration’s conclusions about Arctic development.

The presidential decision was seen by Alaskan reps as hurtful for Alaska’s economy, state finances, and the security and competitiveness of the nation. President Obama was accused of siding with extreme environmentalists while showing a lack of commitment towards improving the lives of the people who live in the Arctic.

Senator Murkowski said: “The only thing more shocking than this reckless, short-sighted, last-minute gift to the extreme environmental agenda is that President Obama had the nerve to claim he is doing Alaska a favor. For him to suggest to the people of the Arctic that they must rely on a nonexistent government working group and $9 million a year in charity as a substitute for real economic opportunity is a slap in the face to countless Alaskans.

“President Obama has once again treated the Arctic like a snow globe, ignoring the desires of the people who live, work, and raise a family there. I cannot wait to work with the next administration to reverse this decision.”

Lame-duck move

Senator Sullivan said: “Make no mistake – the President betrayed Alaskans today – especially those living in the Arctic – who were not consulted, and instead gave one final Christmas gift to coastal environmental elites. This is hopefully the last act of a callous presidency, one that lacks any regard for America’s economic future and the hardworking families of Alaska.”

Congressman Young: “Hell-bent on locking away our resources and suffocating our already weakened economy, President Obama is one step closer to solidifying his place next to Jimmy Carter as Alaska’s worst nightmare. Frankly, this is a cowardly move by a lame duck President – eight years to take this action, yet it comes at the 11th hour with little to no support from Alaskans. The groundwork is already being laid to overturn this terrible decision.”

‘Lame duck’ is an expression used in the U.S. to describe a politician or administration in the final period of office, after the election of a successor.

As for the reserves in the Arctic, according to the statement from Sen. Murkowski’s office, a 2011 analysis found that development of those resources would create an annual average of 55,000 jobs over a 50-year period and generate a total of $193 billion for local, state, and federal treasuries.

Another piece of information from the Senator’s office claimed that a 2014 poll found that 73 percent of Alaskans support Arctic Outer Continental Shelf development.

US and Canada on the same page

Together with Obama, Canada’s Prime Minister Justin Trudeau announced that Canada would designate all Arctic Canadian waters as indefinitely off limits to future offshore Arctic oil and gas licensing.

The difference between the two is that America’s Arctic withdrawal is indefinite while Canada will review the status of its Arctic waters every five years.

With Russian development already underway in the Arctic, the Alaskan trio suggested that it may be just a few short years before America, bracketed by activity on both sides, begins importing oil from the Arctic.

The move announced by the White House on Tuesday means that 3.8 million acres in the north and mid-Atlantic Ocean off the U.S. East Coast and 115 million acres in the U.S. Arctic Ocean will be unavailable for oil and gas companies.

Including previous presidential withdrawals, the action makes nearly 125 million acres in the offshore Arctic unavailable for oil and gas exploration.

In the Atlantic, the withdrawal decision applies to 31 canyons, extending from Heezen Canyon offshore New England to Norfolk Canyon offshore of the Chesapeake Bay. The largest, Hudson Canyon, reaches depths greater than 10,000 feet, comparable in scale to the Grand Canyon, which is 6,093 feet at its deepest.

The Beaufort and Chukchi basins hold an estimated 23.6 billion barrels of oil and 104.4 trillion cubic feet of natural gas.

Can trump overturn the decision?

Although all of the statements above look at Trump as a sort of savior for the Arctic offshore drilling, according to Vox news website, it’s not at all clear if Trump can unilaterally reverse this move without Congress passing a brand-new bill.

Both the ban by Obama as well as a probable revoking of the ban by Trump is based on an obscure section of a 1953 law, the Outer Continental Shelf Lands Act, that, Vox said, has never been tested in courts.

According to Section 12(a) of the Outer Continental Shelf Lands Act, “The President of the United States may, from time to time, withdraw from disposition any of the unleased lands of the Outer Continental Shelf.”

The analysis done by the website states that the law doesn’t say a future president can undo a permanent withdrawal like this. But, two environmental groups, the Natural Resources Defense Council and EarthJustice, claim that this strongly implies that only Congress can put these areas back into consideration for oil and gas leasing.

But it is still uncertain if Trump, who stated during the campaign that he would “unleash America’s $50 trillion in untapped shale, oil, and natural gas reserves,” will attempt to overturn the decision since no president reversed a permanent withdrawal made under section 12(a).

Trump will take over as the 45th President after the inauguration ceremony that takes place on Friday, January 20, 2017, in Washington, D.C., marking the start of the four-year term of Donald Trump as President of the United States.

Offshore Energy Today Staff