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State waiting on Interior appeal for ANWR acreage; next step court?
Kay Cashman Petroleum News
If the state of Alaska prevails in pushing the official boundary of the Arctic National Wildlife Refuge east and thus gaining 20,000-plus acres for Alaska, an oil and gas lease sale for the oil-prone acreage is not a sure thing; rather the Division of Mining, Land and Water, or DMLW, will have conduct a land planning process to determine the best use of the acreage.
Marty Parsons, deputy director of DMLW and the man who is spearheading the state’s effort to obtain the acreage as part of the 5 million federal acres the U.S. Interior Department’s Bureau of Land Management has yet to convey to the state under the Alaska Statehood Act, told Petroleum News May 30 that if the agency’s current effort with Interior is not successful then the next step would be federal court.
The statehood act was enacted in 1958, and the Territory of Alaska was admitted to the Union on Jan. 3, 1959. Because Alaska had no economic base to fund state government, the statehood act made a grant to the new state of 104 million acres of federal lands.
Though the selection and conveyance process was slow and interrupted, the state of Alaska has now received all but approximately 5 million acres to which it is entitled.
Initially, BLM had tentatively approved the lands between the Canning and the Staines rivers that had been selected by the state and then rescinded that approval under the conveyance process back in the ’60s.
The state has been working on ANWR boundary issues on the eastern side of the North Slope since 2012.
In addition to the 19,322 acres of uplands at the state’s boundary with ANWR (see map), it is also seeking ownership of roughly 3,000 acres of disputed tidal and submerged lands between the mouths of the two rivers along the Beaufort Sea coastline.
The state said it previously requested the uplands acreage under the statehood act and the Alaska National Interest Lands Conservation Act.
The state said the western boundary of ANWR “has been improperly mapped” for many years by the U.S. Fish and Wildlife Service, which manages the refuge.
“My administration began a thorough review of the boundary dispute after the Department of Natural Resources received bids in 2011 for oil and gas tracts on tidal and submerged lands at the state-federal boundary,” former-Gov. Sean Parnell said in an Oct. 17, 2014 statement.
DNR, of which DMLW is part, said in the same statement that the Parnell administration’s renewed effort included historical and legal research as well as a field inspection by DNR and the Alaska Department of Law.
Parnell said he was pleased that the state has “developed a solid case for priority conveyance of lands” which the state selected in 1964.
“Alaskans have suffered from many roadblocks to resource development on federal lands,” then-DNR Commissioner Joe Balash said in the Oct. 17, 2014, statement. “Our hope is that the BLM will move quickly to convey lands that we can offer for oil and gas leasing and development.” (Today Balash is assistant secretary of the Department of Interior for Land and Minerals Management.)
When DNR’s Division of Oil and Gas began working with DMLW to determine available acreage that could be awarded in two tracts receiving bids at the state’s 2011 Beaufort Sea areawide oil and gas sale, they determined further research was needed to clarify the boundary, DNR said in an Oct. 21, 2014 statement.
“As a result of that initial work, in 2013, DNR began preparing to assert ownership of the disputed tidal and submerged lands.”
During the research, DMLW “determined that uplands between the Canning and Staines rivers also were improperly mapped as part of ANWR.”
DNR said that after a thorough review of the western boundary of ANWR, “the Division of Oil and Gas today awarded two Beaufort Sea leases pending since 2011 and published tract maps for the Nov. 19 North Slope and Beaufort Sea oil and gas lease sales that accurately reflect the boundary.” The leases, ADL 392120 and ADL 392122, were won by a bidding partnership of J. Andrew Bachner (90 percent) and C. Keith Forsgren (10 percent).
DNR said the division’s actions were based on the state’s “assertion that it owns roughly 3,000 acres of tidal and submerged lands along the Beaufort Sea coastline that were improperly mapped as part of ANWR.”
“I’m pleased that we are now able to award these leases to the 2011 bidders and clarify the acreage that is available for oil and gas exploration in this highly prospective region,” Balash said. “Our next step is to determine how the state’s assertion will affect existing leases on tidal and submerged lands along the ANWR boundary.”
DNR said that for many years the U.S. Fish and Wildlife Service has depicted ANWR’s western boundary as the Staines River, “despite legal descriptions that identify the Canning River as the boundary.” This uncertainty over the western boundary “has created roadblocks for state land managers seeking to administer oil and gas lease tracts at the boundary, particularly on tidal and submerged lands along the Beaufort Sea coast.”
Current adjacent leaseholders The leaseholders with majority ownership in the four leased tracts directly adjacent to the disputed area include Bachner, Savant and Regenerate, a subsidiary of 88 Energy. Although Bachner no longer holds the two leases previously mentioned leases, he recently won another submerged tract along the Beaufort coastline, per Brit Lively of Mapmakers Alaska.
All three of these leaseholders stand to gain acreage if the land dispute between the state and the feds is ultimately decided in favor or the state.
According to Jim Beckham, deputy director of DO&G in an email interview with Petroleum News on May 30, the legal descriptions in the state leases held by Bachner, Savant and Regenerate would likely have “used the land ownership as interpreted by the state; that is, using the western boundary of ANWR as we understood it to be. That means the leases as issued will include all the acreage the state believes it owns and the lessees have been paying rent on that acreage,” he said.
Waiting on final appeal Today DMLW is waiting on its final appeal of BLM’s refusal to make the disputed acreage part of the statehood act conveyance of federal lands to the state.
The appeal was to Interior, filed with Interior’s Board of Land Appeals, or IBLA.
“If IBLA, decides against us, our administration would have to decide if they wanted to take it further. If they do, the next step would be to go through the federal courts, eventually working our way up to the Supreme Court. The appeal we filed with IBLA is the first step we would have to take anyway. The party found against by IBLA could start federal court proceedings,” Parsons said.
What or who was the impetus behind DMLW’s appeal?
“We do continual internal reviews; questions come up on actions by BLM concerning the land selection process. DMLW brought this issue to the commissioner who asked us why specific refusals were made by BLM and we take it from there. This decision to review the border of ANWR originated with our on-going internal review of land conveyances to the state. … The case has been fully briefed to IBLA and the state is awaiting further action by IBLA,” Parsons said.
“We realize the importance of this to the state; that’s why we are working to bring lands in,” he continued. “The federal government still owes the state of Alaska more than 5 million acres in order to complete the state’s land entitlement.”
- KAY CASHMAN
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