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Major oil corporations steered clear of the first oil and gas lease sale in the Arctic National Wildlife Refuge (ANWR) in Alaska, which the Trump Administration opened for drilling and which, contrary to the administration’s expectations, drew very little interest.
The Bureau of Land Management (BLM) received in the Wednesday action bids covering 552,802 acres at the oil and gas lease sale for the Coastal Plain of ANWR, half of the 1.1 million acres offered in the lease sale.
BLM Alaska received 13 bids totaling $14.4 million. Out of the 22 tracts offered, half—11 tracts—received bids.
Oil companies largely snubbed the controversial lease sale, while the highest bidder on nine out of the 11 tracts was Alaska Industrial Development and Export Authority (AIDEA), a company held by the state of Alaska. The two other takers in the lease sale were Knik Arm Services LLC and Regenerate Alaska, Inc.
The controversial lease sale, with which the Trump Administration aimed to open ANWR to drilling, had received earlier on Wednesday an approval to go ahead. An Alaska judge ruled against a request for an injunction against the lease sale, letting the tender proceed.
While the first ANWR oil and gas lease sale was a historic event for Alaska, analysts say the auction was a bust. Industry experts were not surprised that few companies showed up, considering the oil price collapse in 2020 and the growing opposition to Arctic drilling and banks’ refusal to lend money to corporations to develop oil and gas resources in the Arctic.
“It was, in the oil industry terms, a dry hole. A bust,” Larry Persily, a longtime observer of the oil and gas industry in Alaska, told Alaska Public Media.
“They had the lease sale, the administration can feel good about it, but no one’s going to see any oil coming out of ANWR,” Persily added.
Adam Kolton, executive director at Alaska Wilderness League, said, commenting on the results of the lease sale:
“We have long known that the American people don’t want drilling in the Arctic Refuge, the Gwich’in people don’t want it, and now we know the oil industry doesn’t want it either.”
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.