Sullivan takes Alaska oil and gas development to national stage

The State of Alaska plans to offer 14.7 million acres across the North Slope in a lease sale this fall, Department of Natural Resources Commissioner Dan Sullivan said June 30.

Sullivan made the announcement during a visit with the U.S. Chamber of Commerce, part of a trip to Washington, D.C., that included meetings with members of Congress and with the Obama administration, all in the name of promoting Alaska’s resource potential.

Speaking with reporters following his presentation to the Chamber, Sullivan took aim at the president’s recent decision to open up the Strategic Petroleum Reserve.

“Last week we used the Strategic Petroleum Reserve: 30 million barrels, 30 days,” Sullivan said. “We think there is a much sounder policy call. We need to tap America’s real strategic petroleum reserve. That’s Alaska, which could potentially lead to 30 billion barrels over three decades. Alaska is doing all it can to move the country down that more constructive policy path for our nation’s energy security.”

Gov. Sean Parnell wants to boost throughput in the trans-Alaska oil pipeline to 1 million barrels of oil per day by 2020, up from current rates of around 630,000 barrels per day. The newest step toward that goal is a lease sale planned for Oct. 26.

The state holds lease sales annually in several areas of northern Alaska as well as in the Cook Inlet region, but this one aims to offer more land than usual. Although the DNR doesn’t plan to post details of the lease conditions until Sept. 9, Sullivan said the sale would cover three sections of northern Alaska: 576 tracts (about 2 million acres) in the Beaufort Sea; 1,222 tracts (about 5.1 million acres) on the North Slope; and 1,347 tracts (about 7.6 million acres) in the foothills of the Brooks Range Mountains.

“We believe this is the largest lease sale in the United States, certainly for 2011,” Sullivan said. “And if the federal government wants to top Alaska, and beat us, we welcome being the second largest lease sale for 2011.”

Despite his challenge of Obama’s decision to open the Strategic Petroleum Reserve, Sullivan said touting the sale was not a “shot across the bow to the federal government.”

“What we are trying to do is maximize the resource development of Alaska and our country’s resources,” Sullivan said. “As the governor mentioned we have a comprehensive strategy of doing that. We think a million barrels a day within 10 years is something that is critical to energy security and national security to the country.”

Parnell joined Sullivan via videoconference from Juneau.

Parnell said: “For America’s sake we are setting an example for what other resource states can do, and we will be allies with other states as they work to set up domestic energy production.”

—Steve Quinn