Today, the Department of the Interior announced the rescission of seven federal oil and gas leases in the Arctic National Wildlife Refuge (ANWR). The leases held by the Alaska Industrial Development and Export Authority (AIDEA), a public corporation of the State of Alaska, represent the remaining leases from the initial auction in January 2021.
Mandated by Congress in the FY2018 Budget Reconciliation bill (Tax Cut and Jobs Act), the ANWR oil and gas leasing program was initially estimated to raise $1 billion across two lease sales. But the results of the first lease sale were a tiny fraction of that amount.
In January 2021, the U.S. Department of the Interior (DOI) held the first of two auctions for leases to develop oil and gas resources in the Coastal Plain of ANWR in Alaska. The lease sale offered 22 parcels covering 1,089,053 acres. Of those, 11 were bid on, and nine were won by AIDEA. Only two valid bids were submitted by private parties—Knik Arm Services LLC and Regenerate Alaska. After the auction, AIDEA chose not to pursue two parcels they bid on, resulting in 9 parcels covering 437,804 acres being sold for a total revenue of $16.5 million (federal receipts of $8.2 million).
Since then, Knik Arm Services LLC and Regenerate Alaska have relinquished their leases, reducing revenue from the first sale to $13.4 million (federal receipts of $6.7 million) and leaving AIDEA as the only federal leaseholder in ANWR.
Today, DOI announced the cancellation of the remaining oil and gas leases, pointing to serious flaws and legal deficiencies in the underlying analysis for the January 2021 lease sale.
The results of the original lease sale were disappointing and fell far short of what taxpayers were promised. Recent developments further demonstrate little industry interest and poor prospects for oil and gas development in the area, reducing expected taxpayer revenue for future lease sales. Several major U.S. banks and insurance companies have also announced they will no longer finance oil businesses in the Arctic Refuge. It is abundantly clear that taxpayers will not receive the $1 billion in revenue promised by lawmakers during its authorization, and developing oil and gas in an ecologically sensitive area carries great financial risk.
Taxpayers have little to gain and much to lose if we recklessly pursue oil and gas development in the Arctic Refuge.
Read more information on oil and gas leasing in the Arctic National Wildfire Refuge here:
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