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Alaskan Oil Lease Sale Brings Few Bids Despite Vast Territory Offered

FILE- The Chugach Mountains and the buildings of downtown Anchorage, Alaska, are reflected in the still waters of Cook Inlet, Feb. 12, 2016.
FILE- The Chugach Mountains and the buildings of downtown Anchorage, Alaska, are reflected in the still waters of Cook Inlet, Feb. 12, 2016.

An oil-and-gas lease sale that raised concerns with environmentalists due to the vast amount of acres offered in Arctic Alaska drew few bids on Wednesday, government officials said.

Seven bids were received, covering about 80,000 acres - or less than 1 percent of the 10.3 million acres offered in the National Petroleum Reserve in Alaska by the Trump administration. It was, by far, more territory than ever offered in any of the previous 12 NPR-A lease sales held since 1999.

The sale was the latest move by the administration of President Donald Trump, a Republican, supporting his pledge to make the United States "energy dominant" by boosting output of oil, natural gas and coal.

Environmentalists have generally accepted some oil development in the National Petroleum Reserve but worry the Trump administration will lift too many restrictions.

Environmentalists want to entirely block opening the state's Arctic National Wildlife Refuge to drilling.

ConocoPhillips Alaska Inc, in partnership with Anadarko Petroleum Corp, submitted the seven bids, totaling $1.16 million, for tracts in the NPR-A. Results were revealed in a bid opening conducted in Anchorage by the U.S. Bureau of Land Management.

The ConocoPhillips-Anadarko bids were for tracts along the southern border of ConocoPhillips' Greater Mooses Tooth unit, where oil production is expected to start next year.

"Lease sale interest is unpredictable," Ted Murphy, associate director of the BLM's Alaska office, said in a telephone news conference after the sale. "We don't know what industry, ultimately, will be interested in getting from year to year."

Last year's NPR-A lease sale drew $18.8 million in bids, led by ConocoPhillips, for 67 tracts covering 613,529 acres.

One environmentalist said the results on Wednesday suggest that the Trump administration is overestimating industry's desire to drill new Arctic territory.

"It seems, from my perspective, that it's this mentality that if we open it, industry will come. And that's not necessarily true," said Lisa Baraff of the Fairbanks-based Northern Alaska Environmental Center.

Kara Moriarty, executive director of the Alaska Oil and Gas Association, said the low level of NPR-A bidding might show that companies were being strategic about new leases.

She noted that another lease sale for state land "right next door" to NPR-A drew brisk bidding. The Alaska Oil and Gas Division's lease sale, also held Wednesday, drew $19.9 million and over 100 bids, mostly from Spanish energy company Repsol SA and Colorado-based independent oil company Armstrong.

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