Alaska agency says to test Biden suspension of ANWR oil leases

Anchorage — An Alaska state agency will challenge the US Department of the Interior's action to suspend lease activities in the Arctic National Wildlife Refuge, the agency said June 23.

Federal leases were purchased in January by the Alaska Industrial Development and Export Authority, or AIDEA, the state development finance agency, days before President Joe Biden was sworn in to take over from Donald Trump. Biden opposes ANWR exploration and his Interior Secretary, Deb Haaland, recently announced that her agency's lease actions in the refuge would be suspended.

AIDEA, however, is proceeding with plans to market its leases to industry and has started preparation for a winter seismic survey, the authority's board was told June 23 by Alan Wiezner, the authority's executive director.

"Planning and permitting work is necessary to proceed with what we are currently planning to be multi-phased, multi-year seismic surveying of AIDEA's leases for exploration," Wiezner said in an email.

AIDEA believes Interior may be on weak legal ground on its suspension.

"The Department of the Interior has not identified any statutory or regulatory basis for the suspension," AIDEA's staff wrote in a memorandum to the authority's board. "AIDEA holds valid and enforceable leases in compliance with the [US Bureau of Land Management] lease program's statutory directive" in the 2017 tax act, staff continued.

The state agency will budget $1.5 million to hire consultants to prepare an application to test Interior's policy of allowing no lease activity. The department turned down a similar application earlier this year from Kaktovik Inupiat Corp., an Alaska Native corporation that owns a 91,000-acre private enclave within the refuge.

AIDEA holds eight leases covering 365,775 acres acquired in the January sale held by the BLM under the Trump administration. The agency issued the eight leases to the state authority, along with two other leases won by private companies, on Jan. 19, one day before Trump left office.

Potential for major discoveries cited

On his first day in office, Biden announced he would review last-minute actions by Trump, including in ANWR. This was followed by Haaland's announcement that lease activities would be suspended pending a review of BLM's assessment of environmental impacts under Trump.

Interior declined to approve Kaktovik's seismic application on the ground that the corporation failed to do adequate surveys of possible polar bear dens that might be affected by its seismic activity.

AIDEA's leases are adjacent to the Kaktovik lands and it is possible that the private lands may be included. Weizner said the state authority is open to that but has not discussed the possibility with the Native corporation, which is owned by residents of Kaktovik, an Inupiat village on Barter Island at the northern coastal boundary of the refuge.

The private lands were obtained through the Alaska Native Claims Settlement Act of 1971, an act passed by Congress allowing Native communities in Alaska like Kaktovik to select public lands to settle aboriginal claims to public lands.

Kakovik's lands are in the northern central part of ANWR's coastal plain, while AIDEA's leases extend west to near the Canning River, the refuge boundary with State of Alaska lands.

The region is believed by geologists to have potential for major discoveries, but it has only been lightly explored. Only one test well has been drilled in the early 1980s on the Kaktovik lands, the results which are still confidential, and a seismic survey done in the mid-1980s using older geophysical technology.

One reason why geologists see potential in the refuge's north-central region is that oil and gas has already been discovered on state lands just west of the Canning River boundary, including the 8 Tcf Point Thomson gas and condensate field as well as Sourdough, a 50 million-plus barrel known deposit that appears to straddle the state-ANWR border.

Sourdough, which is undeveloped, was discovered years ago by BP and is now being explored by Alaska-based independent Jade Energy.

To date, AIDEA has spent $12.8 million on its ANWR leases including the first-year rental of $3.65 million, according to documents presented to the authority's board June 23.