The exits make it unlikely that digging will take place soon in a vast, unpolluted area that has earned a place among environmentalists and fought battles for half a century. The Anchorage real estate investor and the state-owned Alaska Industrial Development and Export Authority still have leases there, but industry analysts say they lack the financial strength and experience to develop the outlying area themselves.
The Anchorage Daily News first reported the three companies’ decision to withdraw from the refuge.
While Republicans enacted legislation in 2017 that mandated two major rental sales at the refuge by the end of 2024, a coalition of indigenous rights groups and environmental groups launched a campaign to pressure companies against investing in any developments there. The 20 million-acre preserve hosts hundreds of thousands of migratory caribou and waterfowl each year and provides a critical habitat for the animals. Polar bears left in the southern Beaufort Sea.
“This is positive news for the climate and human rights of Indigenous people whose survival depends on a healthy, thriving birthing ground for the Caribou porcupine herd, and it also proves that the oil industry understands that drilling in the Holy Land is bad business,” Wild Alaska State Community Manager Karleen Ichwack said in a statement.
Five major US banks – Bank of America, Goldman Sachs, Citigroup, JPMorgan Chase and Wells Fargo – and a growing list of insurers have stopped providing financing for the Arctic oil business.
“It appears that almost all of the oil companies with leases have concluded that drilling in the Arctic National Wildlife Refuge is unwise after all,” said Eric Graf, deputy general manager at EarthScis’ Alaska regional office. Grafe, who has been involved for years in litigation to prevent Haven’s oil and gas development said, “We are pleased that these companies may have finally seen the light of day, concluding that investing in Arctic oil is a bad deal on a planet that urgently needs to move away from fossil fuels.”
A year before the Biden administration Rentals suspended granted by the Department of the Interior’s Office of Land Management two weeks before President Donald Trump left office, saying the agency had conducted “insufficient analysis” of the impact of drilling in the environmentally sensitive area.
However, the State Development Agency, which bought seven leases covering 366,000 acres before Trump left office, is still trying to obtain permits to carry out seismic studies and preparations for exploration at the refuge.
Alan Wetzner, executive director of the Alaska Industrial Development and Export Authority, He said in an interview Thursday that he was not surprised by the decision of the oil companies to leave the sanctuary in the face of repeated hurdles from the federal government, which “creates a waste of time for businesses within that region”.
“In my opinion, it is very unfortunate that these major investors in Alaska are not allowed to continue to pursue development, and are really being pushed to look elsewhere, in large part outside the United States,” he added. Delays and outright denials of requests to eventually be allowed to proceed with the activities that need to be undertaken.”
There are many obstacles to drilling in the Arctic Refuge. There are no roads or facilities, so building the infrastructure to support oil drilling would be expensive. There has always been strong opposition to drilling in the refuge, which has only intensified as climate change has worsened, driven by the burning of fossil fuels. Arctic Alaska has warmed at least three times more than other parts of the country, posing new risks to oil infrastructure on the North Slope as the permafrost melts.
“If you look at project proposals in other parts of the Arctic, they use things like coolants to freeze permafrost so they can dig further,” said Jenny Roland Shea, deputy director of public lands at the Center for American Progress. liberal thought tank. “It’s not getting colder in the Arctic. It’s getting harder to do things like workouts, and it’s a treadmill.”
Indigenous Alaskan groups with ancestral ties to the refuge celebrated the oil companies’ withdrawal from what they considered sacred land.
“These exits clearly show that international companies recognize what we have known all along: Drilling into an Arctic refuge is not worth the economic risks and responsibility that results from development in the Holy Land without the consent of the indigenous peoples,” the Guichen Steering Committee said in a statement. “The Guechen are united against any development in the coastal plain of the Arctic Reserve.”
Some oil industry analysts see Alaska’s departure as a sign of increased fiscal discipline by oil companies as renewable energy becomes their focus.
Investment advisory firm Raymond James conducted a survey of 50 large oil and gas companies and found that global capital spending was still 5 per cent lower in the pre-pandemic period. levels. The company’s senior energy analyst, Pavel Molchanov, said he also found that ESG considerations – environment, sustainability and governance – are driving these companies toward low-carbon energy such as wind and solar.
“As much as these companies continue to dig, the focus is on the better-established and less-risky opportunities: West Texas, North Dakota, Brazil, Norway,” he said. “There is practically no desire for high-risk exploration in places like Alaska.”
Regenerate Alaska, which purchased a 23,000-acre lease during the Trump administration sale, has requested a refund of its fees and rental payments. Last month, the BLM complied with that request, according to an interior spokesperson.
In addition to the state agency, a company called Knik Arm Services, a real estate investment firm founded in 2020 by investor Mark Graber, has a lease on Coastal Plain.
Many Alaskans still hope that exploration will continue.
“Alaskans have not given up on ANWR and the state is still involved,” former Deputy Governor Mead Treadwell said in an email. “ANWR has been a long battle, but if the government that leases the land does not support exploration and development after that, it discourages investors. This is why the state has taken the fight as its own.”
Treadwell, a business and Republican investor who has also served as chair of the US Arctic Research Commission, noted that development will also continue in other parts of the state.
Interior officials are currently reviewing a proposal from ConocoPhillips to build willow projecta network of drilling sites and a production facility in the Alaska National Petroleum Reserve, west of the Arctic Refuge.
Environmental groups said they remained committed to curbing such development.
“While Chevron and others have changed their minds regarding the Arctic Refuge, others remain intent on expanding oil development in the Arctic,” Grafe said.