Biden admin blocks oil and gas leases in Alaska, hurting Alaskans and all Americans

The Biden administration took two aggressive steps in its war on energy last week.

The US Department of the Interior (DOI) announced the cancellation of seven oil and gas leases in the Arctic National Wildlife Refuge (ANWR) that were issued by the Trump administration to the Alaska Industrial Development and Export Authority (AIDEA).

DOI also released a new proposed rule that would limit oil and gas leasing in the National Petroleum Reserve-Alaska (NPR-A). The agency boasts that it “would establish an outright prohibition on any new leasing in 10.6 million acres, more than 40 percent of the NPR-A.”

The NPR-A is about 23 million acres of federally owned land on the North Slope that is even larger than ANWR.

The Alaskan congressional delegation was rightfully upset with these actions. Sen. Lisa Murkowski (R-AK) said:

Now the Biden Administration, at a time when America and our allies need Alaska’s resources more than ever, has decided to go their own way by further locking Alaska down while refusing to consult with the Alaska Natives who actually live on the North Slope. It’s bad enough to tear up legal contracts and renege on federal commitments. But it’s even more unconscionable that the Biden administration is penalizing Alaska right as it allows Iran to produce more of its oil and solicits the same from Venezuela.

Local officials were not happy either. For example, the mayor of the city of Kaktovik stated:

Forty years ago we found ourselves located in a National Wildlife Refuge against our will. Life has been difficult for us under the Refuge management, there are too many rules and regulations for a small community like ours to adjust to. One of the opportunities we always looked towards was the future potential of oil and gas leasing in the Coastal Plain. The Secretary’s actions today basically goes against Congress and again takes rights away from us to manage our own lands to provide for our future.

The lease cancellations are reminiscent of President Biden scrapping the permit for the Keystone pipeline between Canada and the United States. These retroactive vetoes of lawfully issued leases and permits create uncertainty and discourage future investment in oil and gas.

The cancellation of the leases comes after significant environmental analysis and plans had been submitted and approved, pulling the rug out from companies and communities expecting to receive a return on these pre-production investments.

The federal government itself spent (and apparently wasted) significant time on the final environmental impact statement (EIS). In 2019, DOI reported that, “More than 70 employees (BLM, contract, other federal agencies and the State of Alaska) and at least 13,000 labor hours were dedicated to developing the EIS.” DOI Secretary Deb Haaland has said the statement is inadequate.

AIDEA said that it will challenge the cancellation of its seven leases in court.

Both of the administration’s actions will make the US more reliant on energy imports. Alaskans will miss out on new jobs and stable employment, and the State of Alaska will miss out on tax revenue and economic development from those projects to fund their public institutions and programs.

Administrative decisions – such as permitting and leasing – have a human and community cost that’s difficult to see from DC, but very real for the people who live in affected communities.

These actions are bad policy, and considering America’s high gas prices and inflation more broadly, they are even more egregious. The last thing this administration should be doing is intentionally restricting access to energy and thereby driving up prices.