Gas War: Biden Suspends Oil Drilling Leases in Alaska

Matt Posky
by Matt Posky

On Tuesday, the Biden administration announced it would be suspending oil and gas leases issued in Alaska’s Arctic National Wildlife Refuge during the last days of the Trump administration. Bent on maintaining the United State’s energy independence, Donald Trump had moved to expand fossil fuel development in ways that would have been at odds with predecessor Barack Obama. But today’s White House represents a return to form, with an interest in supplanting traditional energy concerns with what it believes will be greener alternatives.

It’s bad news for the Alaskan state government, which had hoped to devote a subset of the region to rebuilding its oil industry by taking advantage of its vast reserves. But environmentalists and a subset of tribal representatives have praised the decision to prohibit development on protected lands. We expect consumers will have conflicting opinions, based largely upon how much they’re willing to pay at the pump.

White House National Climate Advisor Gina McCarthy said Joe Biden had signaled his gratitude for “the prompt action by the Department of the Interior,” adding that the Trump administration’s policies might have spoiled the natural beauty of Alaska.

While the decision does indeed help to maintain the refuge, there are lingering questions about whether this is truly what’s best for the environment. There have been criticisms that restricting drilling and banning refineries on the West Coast has resulted in an increase in tanker traffic moving across the Pacific. Tankers have been cited as one of the worst contributors to air pollution, with marine shipping estimated to represent a third of all trade-related emissions. Many have argued that it would be more economical and ecologically friendly (from a global perspective) to move fuel via pipelines and localize refining and drilling wherever possible.

But nothing is set in stone just yet. The leases have been stalled and are awaiting an environmental review. Although the Biden administration isn’t just planning on assessing the probable pollution risks, it also wants to explore what it considered “legal deficiencies” represented in the Trump administration’s previous environmental analysis — which it believes were done in haste.

Truth be told, the leases kind of mimic the stringent emission regulations issued by Obama in his final days in office. Many argued that they were designed to make the Trump deregulation policy as difficult to enact as possible and were issued in haste. The leases kind of mirror that in reverse, with their similarly coming shortly before a change in leadership they knew would be attempting to end pipelines and drilling.

Eleven tracts were auctioned off in total, covering an estimated 550,000 acres in the North Slope Borough. The area has a population of fewer than 10,000 living in a zone that’s almost 100,000 square miles. That makes it larger than most states with a populace that’s eclipsed by one modestly sized town. Alaska had hoped the leases would bring in more jobs to its northernmost region and is heavily reliant on the oil industry already. But the planned development site would have overlapped with about a fourth of the Arctic National Wildlife Refuge that borders Canada.

One of the biggest concerns is that there’s effectively no infrastructure within the region, requiring the construction of roads and pipelines to help maintain the drilling sites. While the Alaskan government said those projects would yield even more jobs, environmentalists expressed concerns that this also ran the risk of harming the local wildlife. Local communities, including Iñupiat groups, expressed mixed feelings. Despite many native leaders saying they were fearful of harming the natural environment, most of the small towns in the region are accessible exclusively by air travel. Some locals felt adding infrastructure would result in more amenities and opportunities.

The Alaska Industrial Development and Export Authority said it was disappointed by the decision to suspend the leases, many of which were already subject to lawsuits by various environmental and indigenous groups (e.g. the Gwich’in Steering Committee and Alaska Wilderness League). Alaskan Gov. Mike Dunleavy likewise expressed his dismay, citing that the region had been opened up for development in 2017.

“Our leases for oil and gas are valid and cannot be taken away by the federal government,” Dunleavy stated. “I oppose this assault on Alaska’s economy and will use every means necessary to undo this egregious federal overreach.”

Meanwhile, the Biden administration has continued to signal it wants to restrict traditional energy concerns — particularly if they’re thinking about operating on public lands. That has included executive orders ending any new leasing on federally owned land (or water), which has dissolved about a fourth of the nation’s oil sourcing. But it has more expansive goals to eliminate carbon emissions wherever possible and transition the United States’ economy toward something it believes will be more sustainable.

[Image: Evgenii Mitroshin/Shutterstock]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • Jeff S Jeff S on Jun 03, 2021

    Agree Master Baiter Congress needs to do its job and yes there needs to be a compromise solution that brings stability in the long run.

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    The last Republican I spoke to said that Biden would outlaw all business and implant us all with microchips.

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