Obama's Arctic drilling strategy: It's complicated

Obama's Arctic policy is an 'all of the above' strategy aimed at both energy and wildlife

It was just in January when environmentalists were praising President Obama for setting aside nearly 10 million acres in the Arctic Ocean for protection from oil and gas development. Weeks before that, his administration announced he would not allow drilling in Alaska’s Bristol Bay, home to one of the world’s richest runs of wild salmon.

Now, after his administration on Monday announced conditional approval for Shell Alaska to drill exploratory wells in parts of the Arctic, critics were quick to argue that the decision not only conflicts with the earlier moves, but it raises doubts about the president’s often-stated commitment to increasing renewable energy and reducing the emissions that cause climate change.

Yet Obama’s approach toward development of America’s most remote frontier—a vital nursery for birds, polar bears and whales and also a repository for billions of dollars' worth of oil and gas—has always been a nuanced one, based both on preserving the Arctic wilderness and on ensuring U.S. domestic energy supplies.

“The president has always said ‘all of the above,’” said Marilyn Heiman, director of U.S. Arctic issues for the Pew Charitable Trusts, referring to Obama's strategy for domestic energy production. “He’s never said there will not be drilling in the Arctic Ocean. He’s always said it was part of their drilling strategy.”

The issue was waiting for Obama when he arrived in office in 2009. President Bush was in his final year in office when Shell paid $2.1 billion for leases to drill in the Beaufort and Chukchi seas in the Arctic.

Even after the Deepwater Horizon disaster resulting in a massive oil spill in the Gulf of Mexico in 2010, even after a string of troubles for Shell during an earlier exploration effort  in the Arctic in 2012—including a drilling rig that ran aground—“it was not a question of whether this was going to get approved,” Heiman said. “It was with what stipulations and mitigations.”

The plan approved this week by the Bureau of Ocean Energy Management reflects improvements in safeguards that have been required since the federal government adopted a much more aggressive regulatory role in overseeing offshore oil drilling in the wake of Deepwater Horizon.

But conservationists have expressed a wide range of concerns, including questions about Shell’s spill response plan and how the company will dispose of drilling mud. There are also questions about what additional safeguards the administration will adopt for future Arctic drilling.

“We’re trying to make sure important areas are protected and that we have world-class standards in the Arctic for safety and prevention," Heiman said. “We can’t consider anything in the Arctic without those.”

Until recently, an influential voice on Arctic matters with the White House was Democratic former Sen. Mark Begich of Alaska, an ardent supporter of expanded oil production in the Arctic who left office in January. When Begich ran for reelection last year, he boasted of his influence on Arctic matters – “He took on Obama to get drilling in the Arctic,” said one campaign commercial. He lost the election to Republican Dan Sullivan.

Begich says now that he does not always agree with the president on energy issues but that, “generally, what he’s arguing is a balanced approach.”

Of course, some decisions are easier than others.

The administration’s calculus on Bristol Bay, in particular, was relatively uncomplicated compared with more contentious drilling issues in Alaska. Fishermen, many state political leaders, environmentalists and a number of Alaska Natives lined up in favor of protecting the fishery, and the oil industry made clear that drilling there was not its top priority.

“He actually gets a big score to some degree from a cross section of people,” said Begich, who now runs a business development and consulting firm called Northern Compass Group.

Jason Bordoff, a former top energy advisor to Obama who leads the Center on Global Energy Policy at Columbia University, said it was not the administration’s job to decide whether to allow production “everywhere or nowhere.”

“Rather, the role of the regulatory agencies is to weigh the benefits of increased U.S. energy production against the risks and impacts of such production,” he said in an email. “And that calculation is going to be very different in different areas that are under the protection of the Interior Department.”

Bordoff noted that Monday's decision on the Chukchi Sea was not a change in policy. Shell initially won approval to begin exploratory drilling in 2012.

“This decision is happening in the broader context of aggressive measures being taken to address the risks of climate change, support renewable energy and efficiency, and put in place safety requirements and environmental protections that allow us to benefit from increasing our domestic production of oil and gas that the economy will rely on for some time to come,” he wrote.

Advocates on various sides argued for taking a long view, though with different ideas of what that means.

K.C. Golden, a senior policy advisor for Climate Solutions, a nonprofit organization working to promote a “clean energy” economy, is helping organize a flotilla of kayaks and other small boats in Seattle this weekend in protest of Shell’s plans to make the city a hub for its Arctic operations.

Golden said the risks and costs in the Arctic are too high to justify the exploratory work for any reason.

“The only world in which this expensive oil becomes competitive is a world in which we busted the carbon budget and bought a one-way ticket to climate chaos,” Golden said.

Curtis Smith, a spokesman for Shell, said that the company was being exceptionally cautious and that its plan was safer because of the changes mandated under the Obama administration.

“If we do find a commercial discovery, it would take 10 years or longer before the first oil could be produced,” Smith said. “There’s no rushing. You know how long we’ve been at this.”


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