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More oil leases sold off Alaska's Arctic coast

Oil companies on Wednesday bid more than $42 million for offshore leases in the Beaufort Sea along Alaska's northern coast.
/ Source: The Associated Press

Oil companies on Wednesday bid more than $42 million for offshore leases in the Beaufort Sea along Alaska's northern coast.

The federal Minerals Management Service, which offered the lease sale in Anchorage, said it was pleased with the results. It was the 10th federal offshore lease sale in the Beaufort Sea.

"The oil and gas resources present in the Beaufort Sea are vital to our nation's and Alaska's economy and we hope this will boost future supplies into the trans-Alaska pipeline," John Goll, regional director for the agency, said in a statement.

Companies submitted bids totaling $42.3 million on 92 blocks covering about 502 million acres off Alaska's Arctic Coast. Shell again was the big bidder, accounting for more than $39 million in bids. Shell Gulf of Mexico, Inc., bid more than $14 million to lease Flaxman Island northwest of the Arctic National Wildlife Refuge.

"Shell is committed to Alaska for the long-term and is pleased to be the apparent high bidder for a number of tracts in today's Beaufort Sea Outer Continental Shelf Lease Sale 202," Shell spokeswoman Terzah Tippin Poe said.

Inupiats along coast worried
Not everyone was happy with the lease sale. Earlier this week, Native American and conservation groups appealed a federal government decision to approve Shell Oil's exploration plan for the Beaufort Sea. The groups want to halt Shell exploration activities off the north coast of Alaska that are scheduled to begin in June. These leases were approved in 2005.

The groups say in their lawsuit that the federal agency has failed to consider the potential effects from a crude oil spill during exploration. They fear a spill would be catastrophic, harming polar bears, bowhead whales, walrus and other marine mammals.

Robert Thompson, an Inupiat whaler from the village of Kaktovik — the only village inside the national refuge — said that Alaska Natives and others most impacted by offshore development are not getting their questions answered.

People living on the North Slope want to know what the energy companies are planning off the coast of Alaska and how they plan to handle a spill, he said.

"It is just about everybody on the North Slope that has these questions," he said. "If they can't clean up the Exxon Valdez spill in a much milder climate, we want to know how can they do it under the ice in the Arctic Ocean?"

The Exxon Valdez oil tanker ran aground in Prince William Sound in 1989, spilling nearly 11 million gallons of crude. It was the nation's worst oil spill.

Faith Gemmill, outreach coordinator for REDOIL (Resisting Environmental Destruction of Indigenous Lands), said communities on the North Slope feel their concerns about offshore development are not being heard.

"Most of the Inupiat residents oppose offshore oil and gas development because it poses such a threat to their subsistence way of life because it revolves around the bowhead whale," she said. "These activities are happening at such a rapid pace the people don't have time to respond ... It is like the communities are being overrun by these proposals."

Shell's response
Shell officials routinely meet with communities, leaders and organizations to consult on proposals for exploration, said Poe.

"Certainly, when Shell enters an area to explore we do so with a clear oil and gas business objective, but we also have two other goals — to protect the environment and work with the communities and regions to the benefit of all involved," she said.

Thompson said he's skeptical.

"They aren't going to stop drilling just because we're whaling. They may say such things to get people's approval initially. Once they arrive here, they don't seem to honor those agreements," he said.