Arctic

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 […]

The Arctic Drilling Ban: Much Ado About Nothing?

24 Dec 2016   Arctic, USA

Outgoing President Barack Obama is about to invoke a 1953 law in a bid to protect the Arctic and Atlantic shelf of the United States from the claws of the oil and gas industry, but below the surface it may just be theoretical. The Outer Continental Shelf Land Act, and more specifically its provision 12(a), has only been invoked a few times since the passing of the legislation and has always, until now, concerned discrete areas. This time will be the first when the provision is invoked to protect such large regions of the country’s shelf and it’s looking like the invocation will be more of a symbolic gesture to the environmentalist lobby than anything of practical significance going forward. On the face of it, Obama’s move would interfere with President-elect Donald Trump’s energy policy priorities, where drilling for oil and gas in the Arctic and Atlantic shelf features […]

U.S., Canadian voices chime in on drilling ban

22 Dec 2016   Arctic, Canada, USA

U.S. and Canadian voices debated the wisdom of the indefinite ban on oil and gas work in some of its territorial waters, the Arctic in particular. As part of a joint move with the Canadian government, outgoing U.S. President Barack Obama used his authority under the Outer Continental Shelf Lands Act to ban oil and gas work in the Chukchi and Beaufort Seas off the coast of Alaska, as well as Atlantic coast areas. Dale Marshall with Environmental Defense Canada said the indefinite ban on Arctic oil and gas in particular was welcome news for a nation looking to strike a balance between coastal resources and aboriginal and environmental concerns. “The Arctic holds a precious, yet sensitive ecosystem that is vital to Indigenous livelihoods and culture in the north,” he said in a statement. “Increasingly, governments need to be taking steps to remove the […]

Obama Banned Arctic and Atlantic Offshore Drilling and Big Oil Isn’t Happy

22 Dec 2016   Arctic

President Obama has announced what amounts to a ban of offshore drilling in huge swaths of continental shelf in both the Alaskan Arctic Ocean and Atlantic Ocean, a decision which came after years of pushing by environmental groups. Using authority derived from Section 12(a) of the Outer Continental Shelf Lands Act , the White House banned drilling in a 115 acre area making up 98 percent of federally owned lands in the Alaskan Arctic and a 3.8 million acre stretch of the Atlantic extending from Norfolk, Virginia, to the Canadian border. By taking this route, rather than issuing an Executive Order, Obama made it legally difficult for Republican President-elect Donald Trump’s administration to reverse this action. Environmental groups and Democratic senators have praised the decision, while Republican congressional members and industry groups have denounced it. “Today … the United States is taking historic steps to build a strong Arctic […]

US, Canada designate nearly all Arctic waters off limits to drilling: White House

21 Dec 2016   Arctic

The US and Canada agreed Tuesday to designate the majority of their Arctic waters off limits to oil and natural gas drilling. The US is also permanently withdrawing areas of its Atlantic waters from future oil and gas leasing as well, according to the US Department of the Interior. In a statement, the White House said the “vast majority” of federal US waters in the Chukchi and Beaufort seas and all Arctic Canadian waters would be “indefinitely off limits” to offshore oil and gas leasing. The leasing prohibitions on Canadian waters would be reviewed every five years through a “climate and marine science-based life-cycle assessment,” the White House said. Article continues below… Introducing Platts Well Economics Analyzer Platts Well Economics Analyzer provides information and analytics to help you make confident investment, exploration and drilling decisions. With access to S&P Global Platts data, our proprietary IRR model and our analysts’ […]

Could Tillerson Open Up The Russian Arctic For Exxon Again?

19 Dec 2016   Arctic, Russia, USA

If the ExxonMobil CEO is confirmed as the new U.S. Secretary of State, the evolving relationship between Russia and the United States will take an interesting turn. Rex Tillerson could be in a position to hand his former company a major victory if he helps orchestrate a removal of U.S. sanctions on Russia. The close ties between Exxon’s Tillerson and the Kremlin – and Russian President Vladimir Putin specifically – have raised concerns in a few corners of Washington, which could complicate Tillerson’s nomination. While some Democrats are outraged that the CEO of one of the largest oil companies will be put in charge of U.S. international climate policy, many more have suddenly taken up an anti-Russian stance to oppose Tillerson’s nomination, likely in order to land a blow against Trump. Hawkishness against Russia is typically the purview of the Republican Party, and indeed a handful of hawkish Republicans […]

Russian oil producer pushes deeper in Arctic

29 Nov 2016   Arctic, Russia

Russian oil producer Gazprom Neft said it was starting sea trials for a vessel meant to support oil work, including spill response, in extreme Arctic climates. The company said the vessel Alexander Sannikov was formally launched in preparation of sea trials for late season 2018. It’s one of two icebreakers designed to operate in temperatures as low as 22 degrees below zero Fahrenheit. “The main purpose of the vessels will be ice-breaker tanker support, assistance in mooring and loading, rescue operations, vessel towing, firefighting, and oil-spill response,” the Russian company said in a statement. Work is slated to support operations meant to bring oil out of the Novoportovskoye, or Novy Port, field in northern Russian waters. Greenpeace has objected to […]

More reserves uncovered in Barents Sea

23 Nov 2016   Arctic, Norway

Swedish energy company Lundin Petroleum said Tuesday it made an oil and gas discovery in a frontier area near an existing field in the Barents Sea. The company’s Norwegian subsidiary said it confirmed an oil and gas discovery while drilling a wildcat well, one drilled in a region not previously known to hold hydrocarbons. The well in the Neiden exploration area was drilled about 37 miles northeast of the Alta discovery in the southern waters of the Barents Sea. “The total gross resource estimate for the Neiden discovery is between 25 and 60 million barrels of oil equivalents,” the company said in a statement. The Norwegian Petroleum Directorate confirmed the discovery , putting the preliminary estimate […]

Obama Scraps Arctic Drilling Ahead Of Trump Presidency

22 Nov 2016   Arctic

The Obama administration is rushing to get a flurry of priorities done before Donald Trump takes office. One of those items was a five-year lease plan from the Department of Interior, for the years 2017 through 2022, which includes territories the federal government plans on auctioning off for oil and gas drilling on the outer continental shelf. On November 18, Interior released its plan , and notably absent from the plan was acreage in the Arctic and Atlantic Oceans, a sign that President Obama wants to wall off those areas from future development. The proposed five-year plan includes 11 potential lease sales across four areas – three in the Gulf of Mexico and one in the Cook Inlet in Alaska, which is off of Alaska’s southern coast; the Chukchi and Beaufort Seas off of Alaska’s northern coast – the areas the oil industry hopes to eventually drill – were […]

‘Things are getting weird in the polar regions’

22 Nov 2016   Arctic

A collage of melting sea ice in the Kane Basin between Greenland and Canada’s Ellesmere Island.  As extraordinarily warm temperatures continue in the Arctic — temperatures tens of degrees Fahrenheit above normal for this time of year in some locations — Arctic sea ice, a key indicator of the overall state of this system, seems to be responding in kind. It is kind of unbelievable: On Nov. 19, the extent of Arctic sea ice was nearly 1 million square kilometers lower (8.633 million vs 9.504 million) than it was on that date during the prior record low year of 2012, according to data from the National Snow and Ice Data Center. On Nov. 20, the gap widened further, with 8.625 million square kilometers in 2016 versus 9.632 million in 2012. This is happening in a time of year […]

Obama’s Offshore-Oil Plan Forces Drillers to Focus on U.S. Gulf

19 Nov 2016   Arctic, Offshore

Five-year schedule of lease sales leaves out Arctic, Atlantic Environmentalists have pressed for permanent protections The Obama administration’s decision to forgo auctions of new oil and gas drilling rights in U.S. Arctic waters deals a blow to energy companies seeking to lock up new territory beyond the long-explored Gulf of Mexico. Interior Secretary Sally Jewell said the move, announced Friday, strikes the right balance, by sustaining oil and gas development in the Gulf, while blocking the activity in remote and fragile Arctic waters that could be devastated by an oil spill. “The plan focuses lease sales in the best places — those with the highest resource potential, lowest conflict and established infrastructure — and removes regions that are simply not right to lease,” Jewell said in a statement. “Given the unique and challenging Arctic environment and industry’s declining interest in the area, forgoing lease sales in the Arctic is […]

The North Pole is an insane 36 degrees warmer than normal as winter descends

18 Nov 2016   Arctic, Climate

Political people in the United States are watching the chaos in Washington in the moment. But some people in the science community are watching the chaos somewhere else — the Arctic. It’s polar night there now — the sun isn’t rising in much of the Arctic. That’s when the Arctic is supposed to get super-cold, when the sea ice that covers the vast Arctic Ocean is supposed to grow and thicken. But in fall of 2016 — which has been a zany year for the region, with multiple records set for low levels of monthly sea ice — something is totally off. The Arctic is super-hot, even as a vast area of cold polar air has been displaced over Siberia. Image obtained using a climate reanalyzer. (Climate Change Institute/University of Maine) At the same time, one of the key indicators of the state of the Arctic — the extent […]

Trump May Open Up Arctic Drilling

14 Nov 2016   Arctic

TAPS pipeline Much has been made about President-elect Donald Trump’s plans to dismantle environmental regulations and streamline regulations that could lead to the construction of more pipelines . But there are a few other controversial energy issues that President Trump might ram through a Republican Congress, which would hand the oil and gas industry new areas for drilling that have long been off limits. No other place has been more contentious, more fought over, than the Arctic National Wildlife Refuge (ANWR), a large swathe of territory in northeast Alaska, east of Prudhoe Bay where much of the state’s drilling is located. As its name suggests, the refuge is home to scenic mountains, rivers and lakes rich in wildlife and biodiversity. But it is also thought to hold large volumes of oil and gas reserves, and has been the subject of heated debate since the late 1970s over whether or […]

Billions Of Barrels Of Undiscovered Oil May Lie Under Barents Sea

14 Oct 2016   Arctic

Barents sea oil The latest 3D seismic surveys suggest that there may be billions of barrels of undiscovered oil in the Barents Sea, according to a geology and geophysics expert in an interview with Norwegian broadcaster NRK. “If all the projections are correct and all uncertainties turn out positive so we are talking about billions of barrels,” Kristian Kråkenes, VP Geology & Geophysics at Kuwait Foreign Petroleum Exploration Company (KUFPEC), was quoted as saying. KUFPEC, a subsidiary of Kuwait Petroleum Corporation, operates in Norway with minority stakes in four fields. The 3D data gives a much better picture than previous two-dimensional images, the expert said. Several large and reasonably shallow areas may contain oil, including the area close to the Norwegian-Russian delimitation line in the southeastern part of the Barents Sea, the expert noted. In May of this year, Norway – which had not offered exploration licenses for new […]

Russia Nears Completion Of First Floating Nuclear Plant

11 Oct 2016   Arctic

Russian company Zapsibgidrostroy (it’s a mouthful, yes) has begun the construction of the docks that will carry the world’s first floating nuclear power plant to its location off the Chukotka coast. From there, the NPP will supply power to the coast and to the offshore oil and gas platforms pumping crude in Arctic waters, starting in 2019. Work on the 21,000-ton NPP, named Akademik Lomonossov, has been in progress since 2007, and the plant itself is already complete and undergoing tests. With two low-enriched uranium reactors with a combined installed capacity of 75 MW, the plant, once operational, should be able to produce enough electricity to supply a city of 200,000, along with 300 MW of heat that will save 200,000 tons of coal annually. Civil power and heating supply aside, Akademik Lomonosov could turn into just the first step towards a whole fleet of floating NPPs that will […]

Oil Clout Ebbs in Alaska as Billions in Tax Credits Are Cut

7 Oct 2016   Arctic

A section of the Trans-Alaska Pipeline in the northern Brooks Range, Alaska. A $3.5 billion budget gap prompts tough action by lawmakers Drillers say the changes threaten North Slope momentum Four decades after unlocking America’s biggest oilfield, Alaska and its drillers are drifting apart. Facing a $3.5 billion budget gap, state lawmakers narrowly voted in June to trim tax subsidies that have saved oil and gas explorers almost $1 billion a year since 2007. Governor Bill Walker followed that by freezing $430 million in rebates, and proposing more stringent cutbacks that could be approved as early as next year. State officials say they have little choice, given the drop in oil prices and a flagging state economy. Drillers on the North Slope, the vast Arctic expanse that once led U.S. oil production and still generates a half-million barrels a day, say the policies threaten a nascent turnaround for the […]

New Mega Oil Discovery In Alaska Could Reverse 3 Decades Of Decline

7 Oct 2016   Arctic

A small company just announced that it has made a “world-class” oil discovery in Alaska, which could be the largest find in the state in years. Caelus Energy LLC, a small company backed by private equity, says that it has discovered oil on Alaska’s northern coast. The field could hold as much as 6 billion barrels of oil, with about 1.8 to 2.4 billion barrels considered to be recoverable. If that is the case, the discovery would instantly raise Alaska’s statewide recoverable oil reserve base by about 80 percent. But producing the oil will not be easy. Drilling must take place in the winter. To drill the field, the tentative plan would be to build manmade islands to drill through. Oil produced in the shallow water of Smith Bay will need to be moved somehow. Caelus will have to build an $800 million pipeline that travels 125 miles, connecting […]

Alaska gushes over new oil discovery in the North Slope

6 Oct 2016   Arctic

With a state pipeline system on empty, Alaska’s governor optimistic about a new oil discovery in the state’s North Slope region. Photo by Heather Snow/Shutterstock Alaska Gov. Bill Walker said commitments to the state energy sector have paid off in the form of a major oil discovery in the state’s North Slope region. Described as potentially one of the larger discoveries ever made in Alaska, Caelus Energy said the two wells it drilled into Smith Bay this year led it to believe there may be up to 6 billion barrels of oil in place in the region it holds under a lease. “With an oil pipeline that is three-quarters empty, this is good news for the state of Alaska,” the governor said in a statement . The four-week average to Sept. 23 show total Alaskan crude oil production at around 450,000 barrels per day, down about 4 percent from […]

Caelus Claims Large-Scale Oil Find on Alaska’s North Slope

6 Oct 2016   Arctic

Caelus Energy Alaska makes an oil discovery of 6 billion barrels of oil in place off Alaska’s North Slope. Caelus Energy Alaska LLC reported Tuesday it has made a light oil discovery of 6 billion barrels in place off Alaska’s North Slope. The estimate is based on the results of two wells Caelus drilled earlier this year on its Smith Bay state leases, and 126 square miles of existing 3D seismic data, Caelus said in an Oct. 4 press release. Gross hydrocarbon columns of more than 1,000 feet were encountered in both the Caelus-Tulimaniq No. 1 and step-out Caelus-Tulimaniq No. 2 well, with respective net pay of 183 and 223 feet. Seasonal time constraints prevented the company from flow testing the well, but Caelus said that extensive sidewall coring and subsequent lab analyses confirm the presence of reservoir-quality sandstones containing light oil ranging from 40 to 45 degree API […]