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November 2009

Vol. 14, No. 48 Week of November 29, 2009

Cooperation the key

Mayor Itta spells out North Slope Borough expectations for OCS policy

Alan Bailey

Petroleum News

As summer sea ice recedes and marine habitats change under the influence of a warming climate, the rapidly evolving situation in the Arctic is creating a situation where a wide variety of different groups, including subsistence hunters, the oil industry, environmental groups, governments and shipping businesses, are jostling to support their agendas in the Arctic offshore.

And, with the way in which people think about the Arctic “shifting like the ice pack,” a solid, cautious approach to Arctic policy formulation is needed, to avoid policy chaos, Edward Itta, mayor of the North Slope Borough, said in a statement read by Jim Stotts, chairman of the Inuit Circumpolar Council, to the Resource Development Council annual conference on Nov. 19.

“There’s no formula for easy accommodation of all the various interests involved,” Itta said. “Competing claims need to be balanced and all of these need to be weighed against the best interests of the Arctic system.”

However, given that outer continental shelf oil and gas exploration is already under way, the implementation of standards for offshore oil and gas development requires particular urgency, he said.

Pace of change

The development of Arctic policies must include a meaningful role for the Native peoples of the north, peoples who have made no secret of their concerns about the pace of change in their traditional homelands.

“Nobody knows the extent of the impacts to marine wildlife caused by the retreat of the sea ice. We don’t know how long this will go on, how much of the ice cap will be left in a decade or two, or how well our subsistence wildlife will adapt to such rapid ecological change,” Itta said. “… That is the backdrop for us as we consider policy options for offshore oil and gas development. And I have to add that incidents like the well failure in the Timor Sea off the coast of Australia do not bolster our confidence. A million gallons of oil in the Beaufort or Chukchi seas would be devastating and … there can be no denying that the risks are real and particularly challenging under seasonal conditions of ice and weather and darkness.”

On the other hand, the North Slope Borough economy relies on income from the oil and gas industry.

“Our concerns do not lead us to the same conclusions as the environmental groups,” Itta said. “Like the State of Alaska and all of its citizens, residents on the North Slope depend on oil and gas development as the foundation of our local economy. And our participation in the cash economy is part of what allows us to continue to protect and participate in our traditional subsistence hunting activities.”

Although the North Slope communities have supported onshore oil and gas development, the expansion of oil and gas activities to the outer continental shelf substantially increases the risks associated with possible accidents and constitutes a direct threat to the health of the bowhead whale, “our most precious subsistence resource,” Itta said.

But Arctic OCS oil and gas development may be inevitable.

“And while I would prefer not to see oil rigs in our water, I understand that the industry has to follow the resource,” Itta said. “And if the resource turns out to be as big as the MMS estimates, then development will occur whether we like it or not.”

Given that reality, the North Slope communities need to work with the industry and with federal agencies to craft the best possible environmental protections and mitigation measures.

“It’s a win-win, and I believe it can set a standard that puts Alaska in the forefront of global offshore development standards,” Itta said, adding that a recent study by Northern Economics and the Institute of Social and Economic Research, University of Alaska Anchorage, had indicated that OCS oil and gas development could result in jobs for Alaskans over the next 50 years.

Policy positions

However, the North Slope Borough has put forward eight policy positions that the borough sees as essential to OCS development. These positions include the required use of oil pipelines to deliver oil to land, and a zero discharge standard for offshore oil facilities.

The use of pipelines to deliver oil to market, rather than the loading of oil tankers offshore, would reduce the environmental risks, would create the local economic benefit of having onshore oil facilities, and would bolster throughput in the trans-Alaska oil pipeline.

The zero discharge standard should be similar to that used in Norway’s offshore regions, Itta said.

“This is both achievable and desirable and it would put Alaska in a leadership position we could all be proud of,” he said.

Other North Slope Borough policy positions include the ramping up of the U.S. Coast Guard presence in the Arctic, a requirement for independent ice-trained pilots on the bridges of ships in Arctic waters, a beefed-up effort to conduct baseline science studies in the region, and controls over the number of projects allowed in an area at any one time.

Endangered Species Act

But, although it will be necessary for industry, government and local communities to work through any disagreements over these policy positions, the North Slope Borough sees the current moves towards listing Arctic wildlife species under the Endangered Species Act as a bigger challenge than achieving agreement on Arctic policies.

“This is a concern that I believe can bring us together,” Itta said. “The fallout from endangered species listings is likely to hamstring the routine business of the North Slope Borough in fundamental ways, just as it could similarly effect industry operations.”

In fact, the borough came out against the 2008 listing of the polar bear.

“Climate change poses serious potential problems for marine mammals in the Arctic, but the Endangered Species Act is not the right tool to address the problem,” Itta said. “I believe it is likely to cause havoc with all kinds of human activity in the region without necessarily having any effect on the health of the animals. … We’re all in the same boat in this regard and I’d like to work with industry to come up with innovative solutions.”

Rather than piecemeal animal protection for individual Arctic species, the borough would prefer to see a general-purpose habitat protection plan for multiple species, Itta said.

As an example of the type of problem that the polar bear listing may cause, Itta cited a plan to relocate the airport at the village of Kaktovik on the Beaufort Sea coast. The current airport poses an environmental concern because it is periodically inundated by storm surges. But the permitting of a new runway site may become stymied by the proximity of polar bear denning locations.

Policy initiatives

Itta commented on the number of Arctic policy initiatives that are currently in progress. For example, the North Slope Borough recently welcomed members of President Obama’s Ocean Policy Task Force in Barrow, he said.

“We plan to be involved in these deliberations and as soon as we figure out exactly what ‘marine spatial planning’ is, we’ll know whether it’s a good thing or a nightmare,” Itta said, referencing a planning concept that the task force is considering.

But collaboration between North Slope communities and the oil industry is a key to future success he said.

“Alaska’s greatest chance of success as we move forward in the Arctic is to institutionalize the attitude that industry and local communities are in this together, or even that we’re on the same team, because I believe we need each other and we can certainly accomplish a lot more if we’re able to sit down as collaborators instead of adversaries,” Itta said. “This is my hope for the future of Arctic policy development.”






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