Morning Headlamp: ENI…Drill Baby Drill

Legislative per diem battle continues. The Alaska House’s proposal to reduce legislators’ expense checks appears to face opposition from the Senate President Pete Kelly (R-Fairbanks). Kelly dismissed the House’s plan, which would reduce lawmakers’ annual payments by roughly $14,000, when asked about it Friday. The House’s cut, a total of more than $800,000, was approved in a bipartisan 32-5 vote Thursday. It won’t take effect unless approved by the Senate.

ENI charging ahead! Italian energy company Eni has announced it has submitted an exploration plan to drill for oil in the federally controlled waters of the Beaufort Sea. Eni secured oil and gas leases for a term of five years prior to the Obama Administration’s decision to pull Arctic Ocean leases. Eni has already built a man-made gravel island four miles offshore in state waters. Drilling would extend from the island into federal waters. The Bureau of Ocean Energy Management is reviewing the exploration plan. If the federal agency deems the plan complete, it will begin a 30-day comment period before approving it.

With some 26 billion barrels of oil and 130+ tcf of natural gas, Arctic OCS represents over 1/3 of America’s energy reserves. Headlamp hopes, that for the benefit of Alaska’s economic future, the Trump Administration recognizes this potential and rapidly approves ENI’s plan.

Numbers show Obama Admin. heavily curtailed development. US onshore oil and gas leasing activity fell markedly on federally administered lands during US President Barack Obama’s presidency in several key respects, US Bureau of Land Management statistics indicate. From Sept. 30, 2008, just before Obama was elected to his first term, to Sept. 30, 2016, near the end of his second term, included declines of 83% in the number of new wells drilled, 78% in new leases, and 67% in permits approved. US House Natural Resources Committee Chairman Rob Bishop (R-Utah), meanwhile, said, “Production on federal lands was all but impossible under the Obama administration. Congressional Republicans will work with US President Donald J. Trump and his team to turn the page and develop a more robust, diverse, and affordable domestic energy supply from federal lands, Bishop said. Kathleen Sgamma, president at the Western Energy Alliance in Denver noted, “Who needs the ‘keep-it-in-the-ground’ movement when you have the federal government doing the job itself?”

 

First Reads

With one Cook Inlet pipeline leaking, feds want Hilcorp to inspect another

Alaska Dispatch News, Alex DeMarban, March 20, 2017

Alaska House’s expense cut gets cool reception from Senate president

Alaska Dispatch News, Nathaniel Herz, March 19, 2017

BLM Figures Show Steep Drop in Federal Onshore Oil and Gas Leasing

Oil and Gas Journal, Nick Snow, March 17, 2017

Italian company submits plan to drill for oil in the Arctic
Alaska Public Media, Elizabeth Harball, March 17, 2017

America’s Shale Gas Selling at Record Prices to Overseas Buyers

Bloomberg, Jonathan Crawford & Naureen Malik, March 18, 2017