Arctic

Democratic leaders, indigenous groups, say ‘no’ to Alaskan drilling

8 Dec 2017   Arctic, USA

Alaskans who rely on the state’s pristine resources for survival don’t want the drilling outlined in the Republican tax bill, members of the indigenous community said. A $1.4 trillion, 479-page tax reform bill passed along partisan lines early Saturday morning with Republican leaders in the Senate pushing the measure through on a 51-49 margin. The bill contains a section drafted by U.S. Sen. Lisa Murkowski , R-Alaska, that would open up a section of the Arctic National Wildlife Refuge to oil and gas drillers. Members of the indigenous communities in Alaska were joined by Sens. Elizabeth Warren , D-Mass., Jeff Merkley , D-Ore., and Tom Udall , D-N.M., and Rep. […]

More interest from Asian economies in Alaskan LNG

6 Dec 2017   Arctic, LNG, USA

A Japanese company becomes the second possible Asian consumer to express interest in Alaskan LNG in less than a month. Map courtesy of Alaska Gasline Development Corp. Dec. 5 (UPI) — A letter of intent was signed with a Japanese company to secure liquefied natural gas from a possible development in Alaska, a state pipeline company said. The Alaska Gasline Development Corp. signed a letter of intent with Tokyo Gas Co. on the possible sale and purchase of liquefied natural gas from the Alaskan company’s portfolio. “The letter of intent signed today signifies the continuation of this decades-long relationship between Alaska and Tokyo Gas Co., Ltd. and helps round out the sales volumes from the Alaska LNG project,” the Alaskan company’s president, Keith Meyer, said in a statement . The Japanese handshake is the second Asian nod for Alaskan LNG in less than a month. China Petrochemical Corp., known […]

While U.S. Senate pushes Alaska wildlife refuge drilling, industry looks elsewhere

6 Dec 2017   Arctic

Even as the U.S. Senate moves to allow oil drilling in Alaska’s Arctic National Wildlife Refuge (ANWR), the real action is 150 miles (241 km) west, where industry proponents hope a coming sale of 10 million acres of land will revitalize the state’s sagging crude production. The Trump administration, through the U.S. Bureau of Land Management, will auction off 10 million acres on Wednesday in the National Petroleum Reserve (NPR-A), a hotbed of oil exploration and development in the western part of Alaska’s North Slope. The planned sale has encouraged the oil industry while angering environmental groups. It would be the largest amount of land offered in a single lease sale there. The last sale of 1.45 million acres in 2016 netted $18.8 million, according to the U.S. Interior Department. Sponsored Alaskan crude output this year was just 490,000 bpd, according to government data, far off its […]

Drilling in Alaska refuge likelier as Senate clears tax bill

4 Dec 2017   Arctic

Oil and gas drilling in a vast northern Alaskan wildlife refuge the U.S. government has protected since 1960 moved a step closer to reality on Saturday with the passage by U.S. Senate Republicans of the tax bill. Republicans attached a measure introduced by Alaskan Senator Lisa Murkowski to the tax bill to open a portion of Arctic National Wildlife Refuge, or ANWR. The 51 to 49 passage of the tax overhaul early Saturday was a “critical milestone in our efforts to secure Alaska’s energy future,” Murkowski said. Sponsored Democrats and environmentalists deplore the prospect of development in ANWR, home to polar bears and millions of migrating birds and where Gwich‘in natives depend on migrating caribou. Stitching ANWR legislation into the tax bill that only needed a majority in the 100-member chamber was a “backdoor move” that never would have passed as a stand-alone bill […]

Alaska Drilling Dividend

2 Dec 2017   Arctic, USA

Republicans aren’t advertising it, but a pro-growth bonus in the Senate tax cut bill is that it finally opens up a small part of the Arctic National Wildlife Refuge (ANWR) for oil and gas drilling. Like the rest of the tax bill, Republicans can pass it with a GOP-only majority of 50. Or put to it another way, Lisa Murkowski’s ship has come in. The Alaska Senator chairs the Energy and Natural Resources Committee, which in early November passed legislation 13-10 (with West Virginia Democrat Joe Manchin joining Republicans) requiring the Interior Department to offer drilling rights leases in ANWR’s coastal plain within 10 years. The Budget Committee wrapped this into the broader tax reform that the Senate is expected to pass as soon as Friday. Whether or not this accounts for Ms. Murkowski’s […]

Alaska Drilling Dividend

1 Dec 2017   Arctic

Republicans aren’t advertising it, but a pro-growth bonus in the Senate tax cut bill is that it finally opens up a small part of the Arctic National Wildlife Refuge (ANWR) for oil and gas drilling. Like the rest of the tax bill, Republicans can pass it with a GOP-only majority of 50. Or put to it another way, Lisa Murkowski’s ship has come in. The Alaska Senator chairs the Energy and Natural Resources Committee, which in early November passed legislation 13-10 (with West Virginia Democrat Joe Manchin joining Republicans) requiring the Interior Department to offer drilling rights leases in ANWR’s coastal plain within 10 years. The Budget Committee wrapped this into the broader tax reform that the Senate is expected to pass as soon as Friday. Whether or not this accounts for Ms. Murkowski’s […]

Arctic drilling hits speed bumps in U.S. tax bill

1 Dec 2017   Arctic

A quest by Republicans to open Alaska’s Arctic National Wildlife Reserve was slowed after a nonpartisan Senate official ruled late on Wednesday that the exploration was subject to environmental assessments by the Interior Department. FILE PHOTO: Senator Lisa Murkowski (R-AK) arrives for a Senate health care vote on Capitol Hill in Washington, U.S., July 27, 2017. REUTERS/Yuri Gripas Senator Lisa Murkowski, a Republican from Alaska and the head of the Senate energy panel, has been pushing a measure in the U.S. tax bill that would open a portion of the refuge on the coastal plain to two lease sales in 10 years for drilling. But the nonpartisan Senate official took issue with the energy committee measure as it did not fully consider requirements under a national environmental law. The official ruled that oil exploration in the refuge is not exempt to an environmental law requiring the […]

Italian oil company given drilling permit in Alaska

30 Nov 2017   Arctic, Italy, USA

Letting a foreign energy company drill into the Arctic areas of Alaska is a twin insult from the Trump administration, an advocacy group said. The U.S. Bureau of Safety and Environmental Enforcement said “achieving American energy dominance” moved a step closer with the approval of a permit for a U.S. subsidiary of Italian energy company Eni to drill for oil from an artificial island in the Beaufort Sea starting next month. Kristen Monsell, a legal director at the Center for Biological Diversity, said the decision from U.S. President Donald Trump ‘s administration was “totally boneheaded.” “Drilling for oil in the Arctic is an accident waiting to happen,” the group said in a statement emailed to UPI. “The Trump […]

U.S. wants input on Alaskan oil production proposal

18 Nov 2017   Arctic

The U.S. government said it was seeking additional public input on plans by an oil company to build artificial islands to drill in the Beaufort Sea. The federal Bureau of Ocean Energy Management said it was asking for comments about a draft environmental impact statement on Hilcorp Alaska’s plans in shallow waters about 20 miles east of Prudhoe Bay. In June, Hilcorp was the lone high-bidder for a lease sale in the federal waters of the Cook Inlet off the state’s southern coast. The lease, the first in nearly a decade, brought in $3 million in high bids from the company. A two-volume report running more than 1,000 pages, an impact statement from the BOEM in August described […]

Alaska tries again with ANWR drilling

17 Nov 2017   Arctic, USA

Opening up an Arctic wildlife refuge to drillers is either a sellout to the oil industry, or a symbolic win for the economy, depending on one’s position. Competing claims were made after the U.S. Senate passed a budget reconciliation proposal to open the 2,000-acre Arctic National Wildlife Refuge up to oil and gas drillers. The Arctic Slope Regional Corp., a title holder in the North Slope advocating for fossil fuels, pointed to an unspecified poll that showed a “clear majority” of those living in the region want responsible development. For its part, climate group Earthjustice said “a majority of Americans” oppose drilling in ANWR. U.S. Sen. Lisa Murkowski , the Alaskan Republican who introduced the […]

U.S. Senate Panel Votes To Open Alaskan Refuge To Drilling

16 Nov 2017   Arctic, USA

The U.S. Senate energy and natural resources panel voted to open a portion of an Alaskan wildlife refuge to allow oil drilling on Wednesday, angering conservationists who had fought to save the area from fossil fuel interests. The committee voted 13-10 to allow drilling in the coveted natural reserves. Reuters reports that Republicans have tried to open the Arctic National Wildlife Refuge for drilling for some time now. The area in question is known by the numerical name 1002 and is located in the north. Alaska senator Lisa Murkowski, who heads the energy committee, said drilling the area would boost jobs in the area and increase national natural resources. Murkowski also said drilling in the area would be done “the right way.” Former officials from the U.S. Department of Interior have said developing the area would be risky and expensive. Five of them wrote a letter to the committee […]

China examines LNG potential in Alaska

10 Nov 2017   Arctic, China

A Chinese energy company, Sinopec, said it may be interested in looking at whether or not it can buy liquefied natural gas from Alaska on a regular basis. Alaska’s state government and the Alaska Gasline Development Corp. signed an agreement with Chinese lenders and China Petrochemical Corp., or Sinopec, to advance discussions on the LNG potential in Alaska. The agreement was signed in the presence of U.S. President Donald Trump and Chinese President Xi Jinping . An LNG project in the design phase in Alaska would connect a natural gas reservoir in Prudhoe Bay through 800 miles of pipe to a liquefaction plant on the southcentral Alaskan coast. “Sinopec […]

‘We’re engaged’: Alaska gets China backing for natural gas project

10 Nov 2017   Arctic, China

China’s biggest state oil company Sinopec, one of the country’s top banks and its sovereign wealth fund agreed on Thursday to develop a $43 billion natural gas project in Alaska, as the cash-poor U.S. state seeks to revive its dwindling energy industry. FILE PHOTO: The Sinopec logo is seen at one of its gas stations in Hong Kong April 26, 2010. REUTERS/Bobby Yip/File Photo The deal had been in the works since April and was sealed during U.S. President Donald Trump’s state visit to China. It is the second-largest pact among a slew of agreements signed during the trip between the world’s top two economies that are worth as much as $250 billion. Sinopec ( 601988.SS ), China Investment Corp [CIC.UL] and the Bank of China ( 601988.SS ) will work over the next year with the state government to hammer out the details of their […]

Australian major Oil Search puts Alaska oil in its portfolio

2 Nov 2017   Arctic, Australia, USA

In what was described as its most groundbreaking acquisition, Australian energy company Oil Search Ltd. said it was taking a big step into Alaskan oil. “We’re ready to walk you through one of the most exciting acquisitions we’ve done,” Managing Director Peter Botten said in a conference call with reporters. The company said Wednesday it took on oil assets that Botten said were “particularly attractive” for $400 million in a buy that gives Oil Search a way to balance its core portfolio in Papua New Guinea. The company will take on the role of operator in June 2018, after buying assets in the North Slope from Armstrong Energy LLC and GMT Exploration Co. The Australian company said the North Slope was […]

Statoil will not give up on exploration in Arctic

30 Oct 2017   Arctic, Norway

The chief executive of Norway’s biggest oil company refused to give up on oil exploration in the country’s Arctic despite another disappointing drilling campaign this year.  Eldar Saetre, Statoil’s chief executive, said that the government-controlled company was “very patient” when it came to exploring new areas and that it would return to the Norwegian Barents Sea next year with “optimism but realism”.  Statoil found no oil at its big exploration prospect in the Arctic this year, the Korpsfjell field in an area newly opened up for drilling in the south-east of the Norwegian Barents Sea.  But Mr Saetre said: “It’s a game of patience and longevity. We will drill these wells [next year] and they’re justified. We haven’t found the big stuff. But next year will also be exciting.”  Statoil only returned to exploration in the Barents Sea this year after a three-year hiatus following a previous disappointing campaign.  Oil companies are still struggling to understand the geology of the area of the Arctic just off the north coast of Norway. They argue that the conditions are the most benign of anywhere in the Arctic region with no sea ice and relatively shallow and calm waters.

More than half of Alaska’s oil reserve is up for bids

28 Oct 2017   Arctic

The U.S. Bureau of Land Management will be accepting oil exploration bids for more than half of the land on a Northern Alaska petroleum reserve that’s the size of Indiana. The bureau’s announcement on Wednesday is the largest lease sale to be offered in the National Petroleum Reserve-Alaska, according to Alaska’s Energy Desk . A total of 900 tracts are up for bid, compared with the 145 tracts offered last year. The land up for lease was guided by industry interest in the past. But earlier this year, Interior Secretary Ryan Zinke directed the bureau to maximize the amount of reserve land available for lease. The reserve saw a spike in interest from the oil industry last year, which was spurred by a series of oil discoveries around its northeast part. Alaska’s congressional delegation praised the announcement, while environmental groups said the reserve should not be “plundered without restraint.” […]

Cash-poor Alaska eyes foreign capital to jump-start energy projects

21 Oct 2017   Arctic, USA

Alaska is pursuing foreign investors for its oil and gas industry, hoping to advance recent discoveries while struggling to compete with lower-cost shale projects and reverse a decades-long output decline. FILE PHOTO: The sun sets behind an oil drilling rig in Prudhoe Bay, Alaska on March 17, 2011. REUTERS/Lucas Jackson/File Photo Sovereign wealth funds, banks and state-owned energy companies have met with Alaskan officials, John Hendrix, chief energy adviser to Alaska Governor Bill Walker said in an interview. China Investment Corp (CIC) and state-owned Chinese energy company Sinopec held talks with state officials last month, he said. Alaskan crude production has fallen by three-quarters since 1988, a decline that has contributed to budget deficits and jeopardized the operation of the Trans-Alaska Oil Pipeline, which runs from the North Slope to the southern port of Valdez. This year, a state budget shortfall led the state to withhold […]

Russia Goes All In On Arctic Oil Development

20 Oct 2017   Arctic, Russia

In April, state-controlled oil giant Rosneft started drilling the northernmost well on the Russian Arctic shelf in the Khatangsky license area in the Laptev Sea. In June, Rosneft struck first oil in the Eastern Arctic in this license. Earlier this month, the oil firm said that recoverable reserves at the field exceed 80 million tons of oil, which is equal to around 586.4 million barrels. Geological data point to reserves at the field at 298 million tons of oil, or some 2.184 billion barrels, and the oil is high quality—light and low-sulfur, according to Rosneft. The Russian oil giant—whose CEO Igor Sechin is a close ally of Vladimir Putin—continues to drill at the field to study its geology, search for more oil, and define future drilling strategies at the license, Rosneft says. Rosneft and Gazprom’s oil unit Gazprom Neft are the only two companies allowed to drill in the […]

Big Oil Refuses To Give Up On The Barents Sea

19 Oct 2017   Arctic

Encouraged by recently opened areas and potentially huge yet-to-be-discovered resources, oil companies launched a record exploration drilling campaign in Norway’s Barents Sea this year. But as the summer and the drilling progressed, one dry well after another spelled the end of a disappointing 2017 campaign in which just two viable oil discoveries were made. The most promising wildcat yielded no oil. Still, Norway’s Statoil and Aker BP, along with the Norwegian unit of Sweden’s Lundin Petroleum, are not giving up on exploration in the Barents Sea and promise to return for the 2018 drilling campaign. “Access to new exploration areas will be crucial to the future of the Norwegian continental shelf,” says Statoil, which sees a significant drop in production and activity after 2025 without new exploration acreage and discoveries. Following a continual decline between 2001 and 2013, Norway’s crude oil production rose last year for the third year […]

Trump Aims For Arctic Oil And Gas

22 Sep 2017   Arctic

The Trump administration is trying to lay the groundwork to open up the Arctic National Wildlife Refuge (ANWR) for oil and gas drilling, according to a report last week from the Washington Post . It won’t be easy, and it is not guaranteed to work, but the Department of Interior is hoping to crack open the door to drilling in ANWR, which has been off limits for decades. The Post reports that the Department of Interior is working to authorize seismic testing, a necessary precursor to new drilling. The agency does not have the authority to greenlight drilling itself – only legislation passed by Congress can officially open up ANWR to the industry. But the Department of Interior is clearly betting that they can start the process by allowing seismic testing, in the event that Congress acts at some point in the future to offer up ANWR to oil […]

Trump administration working toward renewed drilling in Arctic National Wildlife Refuge – The Washington Post

16 Sep 2017   Arctic

The Trump administration is quietly moving to allow energy exploration in the Arctic National Wildlife Refuge for the first time in more than 30 years, according to documents obtained by The Washington Post, with a draft rule that would lay the groundwork for drilling.  Congress has sole authority to determine whether oil and gas drilling can take place within the refuge’s 19.6 million acres. But seismic studies represent a necessary first step, and Interior Department officials are modifying a 1980s regulation to permit them.  The effort represents a twist in a political fight that has raged for decades. The remote and vast habitat, which serves as the main calving ground for one of North America’s last large caribou herds and a stop for migrating birds from six continents, has served as a rallying cry for environmentalists and some of Alaska’s native tribes. But state politicians and many Republicans in Washington have pressed to extract the billions of barrels of oil lying beneath the refuge’s coastal plain.

Alaskan Oil Returns With A Vengeance

30 Aug 2017   Arctic

After years of steady decline in production and bottomed-out oil prices, Alaska is in a rough spot. They’re over a billion dollars in debt, in large part thanks to unfulfilled cash incentives to oil companies, and now many of their remaining oil producers are pulling out at the same time that the North Slope and Cook Inlet oil fields face thousands of layoffs . Over the last three decades the Trans-Alaska Pipeline System, which peaked back in 1988, has been steadily draining. Where 2.1 million barrels oil once flowed through daily, now 500,000 barrels trickle through. Older oilfields in Alaska’s oil-rich North Slope have long since been drilled dry, with onetime powerhouses like Prudhoe Bay, the Kuparuk River and the Alpine now nearly out of commission. But all hope is not lost. Now, after an executive order from U.S. Secretary of the Interior Ryan Zinke, the U.S. Geological Survey […]

A Second Wind for the North Slope?

24 Aug 2017   Arctic

Following an executive order from U.S. Secretary of the Interior Ryan Zinke, the U.S. Geological Survey (USGS) is in the process of generating updated assessments of the oil and gas resources on Alaska’s North Slope in what could be the precursor to an exploration and development boom on federal lands that have mostly been off-limits to the industry. The May 31 executive order has renewed a sense of hope for opening currently off-limit areas of the National Petroleum Reserve – Alaska (NPRA), and opening the 1002 Area of the Arctic National Wildlife Refuge (ANWR), which has been tightly closed to the industry since the 1980s, to exploration. As older oilfields such as Prudhoe Bay, the Kuparuk River and the Alpine have long since reached their production peaks, the state of Alaska has been anxiously watching the steady decline of oil through the Trans-Alaska Pipeline System (TAPS) over the last […]

Climate Change Opens Up Shorter Arctic Passage For LNG

19 Aug 2017   Arctic, LNG

The Cristophe de Margerie, an LNG carrier commissioned by French Total, has become the first tanker to pass the Arctic unaided and is now en route to its destination in Asia, the South Korean port of Boryeong, Total said as quoted by AFP. The route via the Bering Strait in the Arctic is 15 days—or 50 percent—shorter than the traditional route for tankers through the Suez Canal, but until recently it was impossible to make the journey without aid from other vessels. Now, climate change has melted some of the ice, making the shorter journey possible without the need for icebreaker escort. Christophe de Margerie, named after the previous chief executive of the French company, who died in a plane crash three years ago, is the first of a fleet of 15 LNG carriers that will carry gas extracted in Yamal, in northwestern Siberia, to Asia via the Northern […]

Alaska’s Conflicted Oil Future

18 Aug 2017   Arctic

Alaska, the final frontier, may be the next oil industry goldmine thanks to aggressive drilling, changing environmental policies, and a bullish administration. Not all Alaskans, however, are on board with the transition, and the issue is now more divisive than ever. Take for example, the polemic Hilcorp, the fast-growing and assertive Houston-based company that while keeping a low public profile, has made a name for itself within the energy industry as a money-making powerhouse. Though the company is less than 30 years old, Hilcorp founder Jeffery Hildebrand has swiftly become a billionaire . His employees are some of the best-paid in the business, famously receiving six-figure bonuses for meeting output goals. Their extreme success, however, comes at a high cost to the same oil-rich terrain that’s putting money in their pockets. Hilcorp is not just famous among energy moguls – it’s also infamous in environmentalist circles. The corporation has […]

Mystery surrounds only oil well drilled in ANWR

24 Jul 2017   Arctic, USA

With oil development advocates again emboldened by the prospects of cracking open the Arctic National Wildlife Refuge, a big secret that could add to the continuing debate over exploration remains as cloaked in mystery as ever. Experts say data from the KIC-1 well — the only well ever drilled in the refuge — remains the tightest of North America’s “tight holes,” an industry term for top-secret wells. The explorers, BP, Chevron and two Alaska Native corporations — subsurface landowner Arctic Slope Regional Corp. and village corporation Kaktovik Inupiat Corp.— have kept the data hidden, with only a small number of people aware of what the drillers found. Federal government geologists aren’t in the know. The rare Alaska state employee who has viewed the information isn’t talking. But the results from the 1986 well, drilled 15 miles southeast of the village of Kaktovik, could be something of a Rosetta stone, […]

Alaska, Maine senators back Arctic drilling in $1.8B federal proposal

21 Jul 2017   Arctic

Two U.S. senators are promoting a federal budget proposal to drill for oil and natural gas in the Arctic National Wildlife Refuge — at a time when many countries are also eyeing resources in the region. “Our access is limited by certain policies,” Sen. Lisa Murkowski , R-Ak., co-chair of Senate Arctic Caucus, said Wednesday at a conference of the Center for Strategic and International Studies. “We need to make sure we are working corporately as Arctic nations, and prevent oil spilling.” Murkowski also said Arctic drilling is a good way to improve long-term energy cooperation with countries like Russia, Canada and China, which are also interested in drilling there. The Arctic region is estimated to contain about 90 billion barrels […]

Drilling slated for Arctic waters offshore Alaska in December

14 Jul 2017   Arctic, USA

Drilling by Italian energy company Eni is set for the Arctic waters off the coast of Alaska in December, the U.S. Interior Department announced. “After a comprehensive review and consideration of comments received from the public, stakeholders, and Federal and state partner agencies and tribes, the Bureau of Ocean Energy Management today conditionally approved a Beaufort Sea exploration plan it received from Eni U.S. Operating Co. Inc.,” the agency announced. The BOEM is a division of the Interior Department. In one of his final moves in office, former President Barack Obama used parts of the Outer Continental Shelf Lands Act to ban oil and gas work in the Chukchi and Beaufort Seas off the coast of Alaska, as […]

Trump Administration Approves Eni Plan To Drill Offshore Alaska

14 Jul 2017   Arctic, USA

Eni US will become the first energy company allowed to explore for oil in federal waters off Alaska since 2015 after the Trump administration this week approved a drilling plan on leases the company has been sitting on for 10 years. The Bureau of Ocean Energy Management approved the drilling plan of Eni US, a unit of Italy’s Eni on Wednesday as part of President Donald Trump’s plan to boost oil and gas drilling and make the country “energy dominant.” The approval is conditional on Eni getting other state and federal permits, which in past cases are generally granted once BOEM gives the green light. “We know there are vast oil and gas resources under the Beaufort Sea, and we look forward to working […]

Is Arctic Drilling Still Profitable For Norway?

10 Jul 2017   Arctic, Norway

Arctic drilling may become unprofitable for Norway if oil prices continue to fall, says a new report looking into the best and worst scenarios for this new frontier in the context of the new normal for international prices. The report comes on the heels of a tender that saw a record-high number of Arctic exploration licenses—102—the vast majority of them in the Barents Sea. The report’s authors, Mads Greaker and Knut Einar Rosendahl, revise significantly downward previous government estimates for the profitability of Arctic exploration, which were made back in 2012 and 2013 when the price of a barrel of crude was much higher than the US$49 for Brent today. At today’s prices, the study’s authors argue, Norway’s Arctic exploration could actually lead to a loss of US$240 million (2 billion crowns), under the worst-case scenario. Under the best-case scenario, profits would be US$4.92 billion (41 billion crowns). This […]

Russia claims new oil field discovered in the Arctic

20 Jun 2017   Arctic, Russia

Preliminary data indicate a new oil field has been discovered in an area said to hold at least a dozen promising reservoirs, Russian oil company Rosneft said. Rosneft said three core samples from the Tsentralno-Olginskaya-1 well in the northern Laptev Sea showed “high oil saturation.” “On the basis of primary studies already, it can be concluded that a new oil field has been discovered, the volume of the resource potential of which is increasing as the drilling continues,” the company said in a statement . The well was the first drilled into the area by Rosneft, which holds 28 licenses in the Russian Arctic. The company boasted that it’s success in the region has been “excellent” so far and said the preliminary […]

Trump’s climate stance looms over Arctic meeting

12 May 2017   Arctic, Climate

U.S. Secretary of State Rex Tillerson will host foreign ministers from Arctic nations at a summit in Alaska on Thursday, where President Donald Trump’s reluctance to fight climate change will likely cast a shadow over talks. The Arctic Council, which includes the United States, Russia, Canada and five other countries, meets every two years to tackle problems in the region, which is warming at a faster pace than any other part of the world. Unlike former President Barack Obama, Trump has expressed doubts about whether human activity has a significant role in climate change, and is mulling whether to pull the United States out of a global pact to fight it. He is expected to decide whether Washington will leave the 2015 Paris […]

Russian researcher claims edge in Arctic oil and gas

11 May 2017   Arctic, Russia

Ahead of a meeting of littoral states, a Russian expert said Wednesday there are new methods to offer an edge in assessing Arctic oil and gas reserves. Vladimir Cheverda, a project director at Russia’s Institute of Oil and Gas Geology and Geophysics, was quoted by state news agency Tass as saying seismic surveys used to get a better understanding of reserve potential is difficult given the geological and technical challenges of working in extreme climates. “Some oil companies attempted to establish systems of observation on floating ice but faced uncontrollable hindrances,” he said. “We managed to determine the source of the obstacles and are developing completely new methods for 3D seismic survey of minerals, as well as software designed for modern high-capacity […]

Trump’s Arctic Drill Plan Challenged by Environmental Groups

4 May 2017   Arctic, Climate

Environmental groups are challenging President Donald Trump’s attempt to restore oil and gas leasing on more than 125 million acres in the Arctic and Atlantic oceans, arguing that a warming world doesn’t need the fossil fuels they contain. The League of Conservation Voters, The Wilderness Society, Sierra Club and seven other conservation groups sued Wednesday in federal court in Alaska, taking aim at Trump’s attempt to make the acreage available for a new generation of oil exploration. President Barack Obama had moved to put those areas off limits for new oil leases. The case joins a flurry of other lawsuits battling Trump’s recent moves to undo environmental regulations and climate policies imposed by his predecessor. It could decide how much authority presidents have to dictate when and where offshore drilling should take place, as the first test of a 64-year-old statute empowering presidents to rule out the activity “from […]

Norway’s Statoil plays down risks ahead of Arctic drilling

25 Apr 2017   Arctic, Norway

Norway’s Statoil on Monday played down concerns that drilling in the Arctic is risky, days before it kickstarts its drilling campaign in the Barents Sea, where the country believes around half of its remaining resources could be located. Despite opposition from environmentalists, the company plans to drill five wells in the Norwegian sector of the Barents Sea, including Korpfjell, which will be the world’s northernmost well and in a formerly disputed border area with Russia “We will start drilling the first well, Blaamann, during May … followed by Kayak, Gemini (Nord), Korpfjell and Koigen (Central),” said a Statoil spokesman, adding each might take about a month to drill. All the wells are in areas free of sea ice thanks to the warm Gulf Stream, with sea and wind conditions similar to the […]

Alaska Needs Much Higher Oil Prices To Reverse Its Oil Fortunes

19 Apr 2017   Arctic

This year marks Alaska’s 40th anniversary of the Trans Alaska Pipeline Systems (TAPS)—an 800-mile-long crude oil route that runs from the North Slope to Valdez, the northernmost ice-free port in North America. However, Alaska’s declining oil output in recent years has not only stretched the state’s budget, it has also added a challenge to the functioning of the pipeline—decreased throughput means the pipeline is now about three-quarters empty, and crude oil flows are slower. The peak of oil flow through the pipeline was at 2 million barrels per day in 1988. Last year, throughput was 517,500 bpd, a 1.8-percent increase from 2015. This was the first annual increase since 2002, but still a far cry from the days of peak flow. Pipeline operator Alyeska is adding heat to keep the crude oil warm and to prevent water from freezing in the line. It also uses so-called cleaning pigs to […]

BP says crews brought leaking Alaskan well under control

18 Apr 2017   Arctic

Signage for a BP petrol station in London, July 29, 2014. BP Plc said workers on Alaska’s North Slope had brought under control a company-operated well that spewed oil and gas over the weekend. The leak was discovered on Friday and a team from BP, the Alaska Department of Environmental Conservation (ADEC), U.S. Environmental Protection Agency and local government was brought in to coordinate efforts. The team halted the well leaks overnight, BP said in a statement on Monday. The volume of the leak was not disclosed. A BP spokesman said details of what caused the loss of control were not available. The oil producer had retained Halliburton Co’s well control specialists to kill the well, the spokesman said. ADEC earlier said in a statement that well pipe had temporarily “jacked up” or risen vertically about 3 feet to 4 feet, causing a pressure gauge to break off. BP […]

BP North Slope Well Leaking Gas After Crude Oil Spray Stops

17 Apr 2017   Arctic

Two leaks found from well in Prudhoe Bay on Friday morning Volume of the leak is undetermined, cause still unknown A well operated by BP Exploration Alaska Inc. on Alaska’s frigid North Slope is no longer spraying crude oil after leaks were discovered Friday morning. The crude spray onto the well pad, which occurred while the well in the Greater Prudhoe Bay area was venting gas, had stopped by Sunday afternoon. A second leak at the well was emitting gas at a reduced rate, the state’s Department of Environmental Conservation said in a statement . Well pressure was monitored through the night and excess pressure was bled off to keep it within a safe range. The volume of the leak hasn’t been determined and the cause of the release is unknown, the department said. There have been no injuries and no reports of harm to wildlife. Based on aerial […]

Pipeline Built to Survive Extremes Can’t Bear Slow Oil Flow

15 Apr 2017   Arctic, USA

Trans Alaska carrying just a quarter of its peak volume The lower the flow, the higher the risks from Arctic cold Here at the top of the world, January brought a glimpse of the anxious future facing Alaska’s once-mighty oil pipeline. The 800-mile Trans Alaska Pipeline System was built for extreme conditions. But as the state’s oil production declines, the pipeline faces a new challenge: flows so sluggish operators worry the line may become unusable, cutting off access for hundreds of North Slope oil wells. With the mercury dipping as low as -60 Fahrenheit, workers in January fired up heating units across the system. It worked, but if the brutal cold had lasted or the oil flow had slowed further, the pipeline would have been in uncharted territory. Four decades after it opened, Alaska’s pipeline — once a symbol of independence for an oil-strapped nation — is facing a […]

Russia tapping deeper into Arctic oil basin

14 Apr 2017   Arctic

Russian oil company Gazprom Neft said it finished drilling a new production well at one of its flagship fields above the Arctic Circle. The company said it finished the well in part of the Novoportovskoye field. The new prospect is currently at a rate considered commercial and “is expected to deliver approximately 25 percent of all oil produced at the Novoportovskoye field over the next three years, and more than 10 percent of all oil produced at Novy Port over the course of its productive life,” the company said in a statement . The field is located above the Arctic Circle and far away from any pipeline infrastructure. Pilot projects were completed in 2014 and shipments facilitated by an […]

Russia Can Wait for $70 Oil Before Returning to Arctic Waters

29 Mar 2017   Arctic, Russia

Russia can wait for a sustained recovery in oil prices before drilling again in Arctic waters, relying for now on less costly regions even as rival producer Norway accelerates development of its northerly fields. “We estimate production costs for the Russian Arctic offshore in the range of $70 to $100 a barrel,” Energy Minister Alexander Novak said by email. These reserves “are our backup stock,” he said before the International Arctic Forum in Russia’s Arkhangelsk, which starts Wednesday. While crude is languishing at around $51 a barrel — less than half the price of mid-2014 — analysts at Morgan Stanley forecast a rebound to $70 by the end of 2019 as bloated global stockpiles decline. As Russia waits, Norway’s Arctic waters may host a record number of wells this year following recent discoveries, new government license awards and efficiency gains. Russia plans to boost exploration in the Arctic Barents […]

There’s almost zero rationale for Arctic oil exploration

24 Mar 2017   Arctic

Drilling the Arctic region for oil cannot be justified against the background of the major shift in the global oil production paradigm, Goldman Sachs’ lead European commodities equity specialist said on Thursday. “Overall the idea that we have to go into the Arctic to find new resources I think has been dispelled by the enormous cheap, easier to produce and quicker time-to-market resources in the Permian onshore U.S.,” Michele Della Vigna, commodity equity business unit leader in EMEA at Goldman Sachs, told CNBC’s Squawk Box on Thursday. “We think there is almost no rationale for Arctic exploration,” he asserted, noting that while certain areas, such as the Russian Arctic, potentially have workable elements given that the location is much closer to the coast and easier to explore, other areas, such as Alaska, can fairly be considered more in the vein of vanity projects. “Immensely complex, expensive projects like the […]

Professor Tad Patzek on Oil in the Arctic

24 Mar 2017   Arctic

[Shell spent 10 years and $7 billion before withdrawing from exploring the arctic because the oil and gas reserves they found were too meager. The company needed “a multi-billion barrel discovery” to “justify going ahead,” Shell chief executive Ben van Beurden said in an investor call last January. Instead, the Berger J well yielded reserves “not sufficient to warrant further exploration,” according to a company statement (full article here ). ] Tad Patzek. 29 Dec 2012. Oil in the Arctic . LifeItself blog. Tad Patzek is a Professor and Chairman of the Petroleum and Geosystems Engineering Department at The University of Texas at Austin. Here are some of the difficulties with drilling and operating offshore oil and gas wells in the Arctic, west and north of Alaska: Gas vs. oil. Natural gas is not oil. Gas price and remoteness of the Arctic make offshore gas production and transport unprofitable. […]

Trump Weighing Eni’s Arctic Drilling Bid in Post-Obama Pivot

17 Mar 2017   Arctic

The Interior Department is weighing Eni SpA ’s request to explore for oil in waters north of Alaska, giving the Trump administration a chance to reverse course from former President Barack Obama’s attempt to curtail Arctic drilling. Eni’s exploration well would be in an area it previously leased from the federal government, and so it isn’t covered by the executive order Obama issued in December to block the sale of new drilling rights within huge swaths of the Chukchi and Beaufort seas. As the Trump administration considers ways it could reverse Obama’s directive, approving this plan could encourage more oil companies to consider Arctic exploration. Although some oil companies have abandoned plans to launch expensive quests for crude off Alaska’s coast, recent discoveries have fanned interest in waters near the shoreline that can be drilled at a lower cost. The Bureau of Ocean Energy Management is conducting an initial, […]

The Monumentally Expensive Quest to Pull Off an Alaskan Oil Miracle

15 Mar 2017   Arctic

Caelus Energy and Jim Musselman are braving polar bears, bitter cold and harsh economic reality. It’s hard to tell where the world ends here on the Alaska North Slope. In the subzero twilight, when the Arctic winds snarl, snow and cloud stretch to every horizon in a seamless vault of spectral white. Beyond the tundra, five miles out on the frozen sea, oil workers from a tiny outfit called Caelus Energy have welded the drilling rig shut against trespassing polar bears. Musselman at the Caelus Energy headquarters in Dallas. “Spooky,” one of them says into the whiteness, and he’s right. The North Slope in February is beautifully, impossibly spooky. This is where Jim Musselman hopes to save Alaska, or at least make a fortune trying. In a shallow […]

U.S. companies claim largest onshore oil discovery in 30 years

11 Mar 2017   Arctic

Energy enterprises Repsol and Armstrong Energy say they made the largest U.S. onshore oil discovery in three decades in Alaska. The conventional hydrocarbon oil was found in the Horseshoe-1 and 1A wells initially drilled during the 2016 to 2017 winter campaign in the Nanushuk, an area located in Alaska’s North Slope. Repsol currently holds 25 percent working interest in the Horseshoe discovery. Armstrong holds the remaining interest, and is listed as the operator. According to a statement by Repsol , the contingent resources identified in the region comprise approximately 1.2 billion barrels of recoverable light oil. Repsol has been exploring Alaska for oil reserves since 2008, and began drilling multiple consecutive discoveries in 2011 in the North Slope with its partner Armstrong. The […]

How Tillerson Could Fuel A Russian Arctic Drilling Boom

24 Jan 2017   Arctic

It’s now clear to nearly everyone that U.S. President Trump intends to seek warmer U.S. relations with Russia, while putting China and Iran relations in the deep freezer. Trump has made no secret of this major shift in policy. It’s also clear that he sees China, very much like Obama, as a major threat to U.S. global leadership. Trump has often stated that he thought the Obama sanctions on Russia was catastrophic for the U.S., resulting in only pushing Russia into an alliance with China, a fear that many noted policy experts have echoed. For Russian energy companies, it means the doors are cracking open again for business. Russia is again a hot topic on nearly every news site. And the topic has become even hotter with the U.S. election of a Putin-friendly president, who seems ready to share responsibilities with Russia for organizing the world’s response to global […]

Arctic-Drilling Fever Roars Back as Republicans Target Preserve

23 Jan 2017   Arctic

Far above the Arctic Circle, one of the longest-running controversies in US oil drilling is about to reignite. (Bloomberg) — Far above the Arctic Circle, one of the longest-running controversies in U.S. oil drilling is about to reignite. Bouyed by Donald Trump’s election, Republicans are pushing to allow oil exploration in the Arctic National Wildlife Refuge, the frigid wilderness in northern Alaska that’s been a political battleground for drillers and conservationists for decades. The prospects for industry look better than they have in years, with Republicans in control of Congress and Trump vowing to boost U.S. energy production. There’s just one catch. No one really knows how much oil actually lies beneath the refuge, or how much producers like Exxon Mobil Corp. and ConocoPhillips care about it in a world awash in cheap oil, from Texas shale to offshore Africa. While the government estimates the area could hold 12 […]

Expert warns of Arctic drilling risks

20 Jan 2017   Arctic

A highly acclaimed Oxford professor who’s considered an expert on energy research has thrown cold water on Norway’s hopes for a new oil era in the Arctic. Dieter Helm doesn’t think oil prices will rise much higher and are more likely to fall, making costly oil investments in the Barents Sea unprofitable. Environmental activists have been at the forefront of warning about the risks of Arctic oil exploration and production. An Oxford professor and energy expert claims the economic risks are high as well. PHOTO: Greenpeace Helm, addressing an annual gathering of top oil industry officials in Sandefjord this week, said that an oil price of USD 50 a barrel is in fact high in historical perspective, even though it’s half of what it was just a few years ago. He thinks the current level of around USD 54, which has doubled in the past year but remains far […]

Big Oil May Finally Get to Drill in the Arctic, But Is It Worth It?

20 Jan 2017   Arctic

Far above the Arctic Circle, one of the longest-running controversies in U.S. oil drilling is about to reignite. Bouyed by Donald Trump’s election, Republicans are pushing to allow oil exploration in the Arctic National Wildlife Refuge , the frigid wilderness in northern Alaska that’s been a political battleground for drillers and conservationists for decades. The prospects for industry look better than they have in years, with Republicans in control of Congress and Trump vowing to boost U.S. energy production. There’s just one catch. No one really knows how much oil actually lies beneath the refuge, or how much producers like Exxon Mobil Corp. and ConocoPhillips care about it in a world awash in cheap oil, from Texas shale to offshore Africa. While the government estimates the area could hold 12 billion barrels of crude, making it one of the biggest untapped reserves in the U.S., no one’s sunk a […]