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Alaska refuge drilling bill clears committee: Update

15 Nov 2017, 10.41 pm GMT

Alaska refuge drilling bill clears committee: Update

Updates with changes throughout

Washington, 15 November (Argus) — A Republican-led US Senate panel today voted to open the coastal plain of Alaska's Arctic National Wildlife Refuge (ANWR) to oil drilling within four years.

The Senate Energy and Natural Resources Committee approved the measure 13-10 in a nearly party-line vote.

The bill will be added to a $1.5 trillion tax cut bill that is still being debated. The combined package is expected to come to the floor of the Senate for a vote "sometime after Thanksgiving," committee chairman Lisa Murkowski (R-Alaska) said today.

The measure resurrects a decades-old struggle between environmental groups and the oil industry over drilling in the refuge.

"There will be an effort to strike the energy piece, and we will gear up for that battle again," Murkowski said.

The legislation would lift a ban that encompasses all of ANWR, but Republicans said most of the refuge would be left untouched with the drilling concentrated in a 1.5mn-acre (6,000km²) region known as the "1002 area."

The area, which is located along the coastal plain within ANWR, is estimated to hold 7.7bn bl of technically recoverable oil. State and tribal lands within the reserve's boundaries are estimated to hold an additional 2.7bn bl of oil. The measure would require the US Interior Department to hold a 400,000-acre lease sale in the refuge by 2021 and another similarly-sized lease sale by no later than 2024.

Critics of the bill say it would convert a refuge set aside for wildlife protection into an active oil field.

"You are saying a wildlife refuge's purpose is for oil and gas development," the committee's ranking member Maria Cantwell (D-Washington) said. Democrats also said the bill would allow oil and gas leasing no matter what reviews of the potential environmental effects found.

Republicans say oil-related infrastructure would be limited to 2,000 acres, while the remaining 17.8mn acres of ANWR would remain a refuge.

"We will not sacrifice the polar bear, the migratory birds, the caribou, for the sake of development," Murkowski said. "I would not support development if I was not convinced we can do it safely."

Republicans want to allow drilling under a process that could not be filibustered and would move in tandem with a pending $1.5 trillion tax cut bill. As part of that process, the Senate energy committee received instructions to find $1bn in deficit reduction over the next decade, creating a path for the ANWR legislation to pass.

The US Congressional Budget Office last week estimated the two lease sales in ANWR would fulfill that requirement by generating nearly $2.2bn, an amount that would be split evenly between federal government and Alaska. Murkowski said a "vast amount" of additional oil royalties would come from the leasing, although those new funds would not flow in until after the 10-year budget window used for legislation.

Public interest groups say that revenue estimate is unrealistic. Taxpayers for Common Sense says it is "extremely improbable" the lease sales would generate $2.2bn, since it would require acreage to sell for an average of $2,750/acre, if 800,000 acres is leased. That price is nearly 90-100 times higher than recent lease sales in the National Petroleum Reserve in Alaska.


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