Despite high gasoline prices, the Biden administration is reversing a Trump policy that opened up land in Arctic Alaska to new oil development. Biden’s Department of the Interior will scrap the Trump policy that authorized expanded leasing and development in the National Petroleum Reserve in Alaska, or NPR-A. The Trump administration approved a plan to allow oil leasing and development in 82 percent of the 23-million-acre reserve (about the size of Indiana), which replaced a 2013 Obama administration plan that allowed oil leasing and development on about half of the reserve. The Obama administration action was a reduction in the area available for lease from the Clinton administration. The Bureau of Land Management will be filing the official notice of the reversal in federal court in Alaska on Monday.
The Trump administration opened up more of the reserve 11.8 million to 18.6 million acres to expand the country’s energy potential and create jobs for Native Alaskans and the nation. According to the Anchorage Daily News, the Alaska Inupiat Eskimo people of the North Slope who live in and around NPR-A reacted forcefully in opposition to the Biden administration’s move. Leaders of the Arctic Slope Regional Corp. and the North Slope Borough (the Native Alaska organization and the local county-equivalent government) said in a joint statement that reverting to the 2013 land-use plan “diminishes Alaska Native self-determination by ignoring the needs, concerns and input of the local people who live, work and subsist in and around the NPR-A.”
ASRC President and CEO Rex Rock, Sr. said North Slope leaders have made multiple offers to work with Biden administration officials on issues such as the NPR-A to no avail. “(Interior) Secretary Haaland and President Biden have chosen, with this decision, to not only ignore the voices of the North Slope Iñupiat but to exclude us from the decision-making process on issues that impact our Iñupiat communities and our culture,” Rock said.
The latest announcement comes as part of litigation over the issue. In its new announcement, the BLM indicated that it does not think it needs to undertake a new environmental review. Instead, it plans to publish a new “record of decision” which formally establishes its policy.
The National Petroleum Reserve in Alaska (NPR-A) is a 23-million-acre area on Alaska’s North Slope— the largest tract of federal land in the country and home to vast oil, gas and coal deposits. In 1923, President Harding set aside the area as an emergency oil supply for the U.S. Navy. In 1976, in accordance with the Naval Petroleum Reserves Production Act, administration of the reserve was transferred to the Department of the Interior’s Bureau of Land Management (BLM). The BLM is expected to hold annual oil and gas lease sales for the NPR-A, but the last NPR-A lease sale held by the BLM was in 2019
Alaska’s Oil Production and TAPS
According to the Energy Information Administration, Alaska produced 448,000 barrels of oil a day in 2020—a 43-year low. Oil production in the state peaked in 1988 at more than 2 million barrels per day, but the low flow levels from the reduced production are now putting the Trans Alaskan Pipeline System in jeopardy.
In July of 2021, Alaskan oil production was 380 thousand barrels per day, dangerously close to levels where the Trans-Alaskan Pipeline System (TAPS) can no longer operate because of lack of throughput. What TAPS needs is more oil. But, oil companies did not want to invest in Alaskan oil projects during the pandemic due to extremely low oil prices. Further, drilling approvals granted by the Trump administration were withdrawn by President Biden in response to the cries of anti-oil groups. And, under pressure from environmental groups, the six largest U.S. banks have pledged in recent years not to finance additional Arctic drilling, even though they willingly involve themselves in fossil fuel projects in China.
Since President Biden took office, gasoline prices have risen about $1.00 a gallon as he immediately undertook anti-oil and gas policies following the inauguration, beginning with the cancellation of the Keystone XL pipeline. That was followed by bans on new oil and gas leases on federal land and waters, including the Arctic National Wildlife Reserve and Alaska’s Petroleum Reserve, and pressure on banks not to lend to the oil and gas industry in the United States.
Oil prices surged to a seven-year high, surpassing $85 per barrel, but are now settling around $80 a barrel. Gasoline prices are the highest level in 10 years, topping $3.30 per gallon, according to AAA’s national average on January 11. That gasoline price is a 42 percent increase over the price a year ago, when it was $2.318. Biden is continuing with his anti-oil and gas policies by reversing President Trump’s increase in acreage in the Naval Petroleum Reserve Alaska. According to Alaska Native people who live in the region, this was done without consultation and will hurt their future. That along with Biden’s other policies have negated the energy independence achieved under President Trump and made the United States more reliant on imports of oil from countries with less environmental regulations than the United States, and into the geopolitical fires of the Middle East.