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January 2006

Vol. 11, No. 4 Week of January 22, 2006

Borough seeks Native allotment mandate

North Slope Borough government officials ask Pioneer Natural Resources to compensate Native allotment holders

Kay Cashman

Petroleum News

When the North Slope Borough Assembly approved Pioneer Natural Resources’ request to rezone the Oooguruk oil project from conservation to resource development in early January it tacked on a number of conditions to its ordinance.

One of those conditions was something new—something that’s a direct result of development inching west into the more populated areas of the North Slope.

To date oil companies have had to deal with government officials regarding mitigation (generally fees) for subsistence and other impacts. But this time the borough said “Pioneer must engage in a meaningful and beneficial working relationship with the Native Allotment owner(s) directly impacted by this development. Pioneer shall mitigate impacts to Native Allotments to the extent feasible.”

Allotments are chunks of land as large as 160 acres held by the federal government for individual Natives that are used mainly to support the area’s subsistence lifestyle.

Borough spokesman David Harding told Petroleum News in mid-January that Pioneer is already in negotiations with those allotment holders that will be most impacted by Pioneer’s proposed Oooguruk development, which is in the shallow waters of the Beaufort Sea off Alaska’s North Slope.

“As I understand it, there are a handful of Native allotments owned by members of the same family – one adjacent to the pipeline corridor – others a little farther away.”

“They and Pioneer have already given negotiations a good effort,” Harding said.

“It’s not an issue of going across someone’s allotment, because in that case the BIA (U.S. Bureau of Indian Affairs) would handle it. There is no development on the allotments, so BIA stays out of it, and the borough is left to deal with other issues like subsistence impacts,” he said.

“It’s a difficult issue for everybody. Pioneer and the borough in good faith have tried to be sensitive to the concerns of the allotment owners. But there is only so much the borough can do in its capacity as a land use manager. The borough can’t stop this project – everybody agrees with that. The borough can’t really do much more than it did (in the rezoning ordinance) to address the concerns of the allotment owners,” Harding said.

But even though no part of the Oooguruk project will be built on a Native allotment, “it’s a very real concern to allotment owners near the project. … One allotment is already bordered by pipelines. Nuiqsut had that problem (with the Alpine field). After awhile you get hemmed in with pipelines and your subsistence lifestyle really begins to deteriorate,” he said alluding to changes in the migration habits of wildlife and the fact that Native hunters can’t fire guns near developments, including pipelines.

“There has been a real effort on both sides – Pioneer and the allotment owners – to reach an understanding so the project can go forward. Allotment owners are not trying to stop it, but they are concerned when another pipeline comes in view of their allotment. It really does restrict their use of the land,” Harding said. “There has been sort of an unspoken understanding among subsistence hunters – they don’t hunt around pipelines within view … the same way you don’t hunt close to someone’s house.”

Nuiqsut a separate mitigation deal

Another condition of the rezoning was more “boilerplate,” he said, referring to the conflict avoidance provision in the ordinance.

According to it, “Pioneer must enter into a Conflict Avoidance Agreement with the Alaska Eskimo Whaling Commission including an agreement under the Good Neighbor Policy for oil spill mitigation. This agreement will include procedures to be followed in the event of an oil spill as well as restrictions on barging and vessel traffic during fall whaling activities. This conflict avoidance agreement is in addition to the Nuiqsut Mitigation Fund that Pioneer, Kuukpik Corporation, the City of Nuiqsut, and Native Village of Nuiqsut have already agreed to establish.”

When asked why the borough wasn’t handling the mitigation fund, Harding said “The three Nuiqsut organizations came up with a separate mitigation deal. They approached Pioneer and worked it out.”

Subsistence studies part of package

Another condition of Oooguruk rezoning was a provision for subsistence studies, which directs Pioneer to enter into an agreement with the borough “to identify and fund needed studies of subsistence resources and impacts on them from this proposed development. This agreement will be negotiated by July 15, 2006.”

Funding these studies helps fill in the holes in our understanding of the area,” Harding said. “It’s part of onshore monitoring. … The studies make sense because in the course of doing these development projects … there is a real world opportunity to learn more about our environment and how development impacts it.”

Oooguruk is expected to be sanctioned by Pioneer in the next few weeks, although the company is still waiting for its permit from the U.S. Army Corps of Engineers.

If the company can start moving gravel for its island this winter there is a chance Oooguruk will be in production as early as 2007. The production life of the project is estimated to be 20-30 years.






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