The Obama administration has made it harder to drill for oil in the Arctic Ocean – not that many companies are trying to do so these days.
After years of revision, the administration announced final rules late last week that require companies working in the offshore Arctic to put in place new safety precautions to prevent and contain oil spills in the remote and forbidding region.
Yet with the price of oil low and the cost and perils high, there currently are no companies drilling offshore and none with immediate plans to do so.
Last fall, citing “current market conditions and low industry interest,” the administration canceled planned lease sales in the Arctic and denied extensions of existing leases. But some existing leases have not yet expired, and new Arctic lease sales could happen under the next presidential administration.
The Department of the Interior, which oversees offshore drilling, said that “finalizing these regulations will ensure that, should operators decide to act upon their leases or any future leases in these planning areas, they will operate with robust safety and environmental protections in place.” The planning areas are in the Beaufort and Chukchi Seas.
The rules are rooted in part in the administration’s experiences with Royal Dutch Shell, which encountered a series of setbacks when it pursued exploratory drilling in the Arctic in 2012 and 2015.
In 2012, a Shell drilling rig ran aground. Last September, Shell announced that the oil and gas it had found was “not sufficient to warrant further exploration” and said it was abandoning its Arctic efforts “for the foreseeable future.”
The new rules effectively make permanent the restrictions Shell was working under, which included having equipment near drilling sites that can cap or contain a spill and having a secondary “relief rig” nearby in case there is a blowout.
The new precautions for the Arctic are not required in more accessible areas such as the Gulf of Mexico, where a large infrastructure of support services exists for drilling operations.
Industry groups and some Republicans criticized the rules formalized last Thursday.
Rep. Rob Bishop, a Utah Republican who is chairman of the House Committee on Natural Resources, said restrictions put in place by the Obama administration were effectively yielding Arctic oil development to other nations, including Russia.
“This was never about responsible development, it was about keeping the Arctic frozen from development,” Bishop said in a statement.
“The rule is based on the fallacy that it is technologically unsafe and economically un-viable to develop the Arctic. The Obama administration has used every tool at its disposal to deny Native Alaskans economic growth opportunities, undermine America’s energy strength and risk national security.”
Environmental groups largely praised the rules, though with qualifications.
Michael LeVine, a lawyer for the conservancy group Oceana, said the new rules cannot “ensure safe and responsible operations or address all of the deficiencies in government decisions about offshore oil and gas activities in the Arctic Ocean.” He added, “There is no proven way to respond to a spill in icy Arctic waters.”
LeVine and others urged against future lease sales in the Arctic as well.
Officials said that the Arctic is believed to contain 24 billion barrels of recoverable oil and 124 trillion cubic feet of recoverable natural gas.
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