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Vol. 12, No. 23 Week of June 10, 2007
Providing coverage of Alaska and northern Canada's oil and gas industry

Bristol Bay leasing may be in jeopardy

Alliance, CEA join forces to lobby Congress for continued access to OCS energy exploration and development opportunity

Rose Ragsdale

For Petroleum News

Six months ago, the U.S. government lifted a moratorium on oil and gas leasing in Bristol Bay, bringing new hope for exploration and development activity in that largely unexplored region of Alaska.

Industry forces now find themselves lobbying Congress to hang onto this new opportunity.

Led by the national Consumer Energy Alliance, the push comes in response to a recent effort in the Democratic-led Congress to undermine provisions of the Energy Security Act and the Bush Administration’s 2007-2012 Five-Year Plan for access to the Outer Continental Shelf.

In January, President Bush ended drilling bans in an area of the central Gulf of Mexico and in Bristol Bay, which is part of Alaska’s North Aleutian basin. Congress put Bristol Bay, where commercial and subsistence fishing is strong, off limits to drilling in 1990 after the Exxon Valdez tanker oil spill.

Locally, the Alaska Support Industry Alliance appealed to its members earlier this month to send letters, faxes and emails to members of Congress in support of the Administration’s energy policies.

Officials of the Aleutians East Borough also mounted a pro-drilling campaign in May, visiting dozens of congressional offices in support of responsible offshore oil and gas exploration and development in the region.

Bill to reach floor in mid-June

Several members of the U.S. House of Representatives are considering new restrictions, including permanently closing Bristol Bay to oil and gas leasing. The Democrats also would limit future U.S. energy production, increase royalty payments to the government and hamper recently streamlined permitting processes, according to the CEA.?

“When the moratorium was removed, the Minerals Management Service had received more than 3,500 positive comments about offshore leasing in Bristol Bay from Alaskans, and that positive input was part of the justification for lifting the moratorium,” said Kara Moriarty, a spokeswoman for the Alaska Oil and Gas Association.

MMS, the federal agency that oversees oil and gas activity in federal OCS waters, has estimated that Bristol Bay could hold about 23 trillion cubic feet of natural gas reserves.

The House committees on Natural Resources and Appropriations met June 6-7 to draft energy reform legislation and a final bill was expected to reach the House floor in mid-June.

Amendment calls for more studies

The Appropriations Committee narrowly approved a measure June 7 that could delay oil and gas leasing in Bristol Bay by requiring further environmental impact studies.

The amendment, sponsored by Rep. Maurice Hinchey, D-N.Y., calls for further study of the impacts of drilling Alaska’s North Aleutian Basin, including Bristol Bay, because the MMS may have inadequate coordination with other federal agencies to ensure best available protection.

Under the proposal, the MMS, the U.S. Geological Survey, the Government Accountability Office and several other federal agencies would be required to conduct in-depth analyses of exploration in the basin.

The Appropriations panel also rejected a proposal that would have opened up more of the OCS to natural gas exploration and development.

U.S. Rep. Don Young, R-Alaska, the ranking member of the House Natural Resources Committee, joined other Republicans in voicing opposition the week of June 3 to the attempts to reimpose the OCS restrictions.



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