The authorization of oil and gas leasing on the Arctic National Wildlife Refuge's coastal plain in late December is not the only significant provision in the federal tax reform bill which became law in late December for the US oil and gas industry. But it clearly is the most obvious.
Alaska's congressional delegation celebrated when the US House passed the amended tax bill on Dec. 20, clearing the way for President Donald Trump to sign it into law several days later. "This is a watershed moment for Alaska and all of America. We have fought to open the 1002 Area for a very long time, and now, our day has finally arrived," said the state's senior US senator, Republican Lisa Murkowski.
In Juneau, Gov. Bill Walker, an Independent, said the area where two lease sales would be held in the next decade is one seven-hundred-fiftieth of the 1002 area on the coastal plain, which was set aside for oil and gas development. He said the state would continue conferring with residents.
Opponents immediately pledged to continue fighting. "Those members [of Congress] who supported this tax scheme voted to end protections for an area first set aside more than a half-century ago by Republican President Dwight Eisenhower," 23 environmental and Alaska Native groups said in a joint statement. "We will remember their names, and we will remember their votes."
Federal lawmakers from Alaska have been trying to get leasing on ANWR approved for 37 years, Murkowski noted. Potential production could help refill the Trans-Alaska Pipeline System, which opened in 1977 to carry crude from nearby Prudhoe Bay field but has falling throughput because of North Slope production declines.
Murkowski saw an opportunity in 2017, when congressional GOP leaders were looking for ways to offset a major corporate tax reduction they and the president wanted. As chair of the Senate Energy and Natural Resources Committee, she moved ahead in early November with a strategy to raise $1 billion with ANWR leasing.
Blow to bipartisanship
Ranking Minority Member Maria E. Cantwell (Wash.) and other committee Democrats said Murkowski pushed the plan through outside of customary channels last fall. It became part of the tax reform bill nevertheless. It's not certain whether the committee, which had been a bipartisan outpost for decades as others in Congress grew more acrimonious, will regain much of its previously cooperative spirit.
Developing leases on ANWR's coastal plain would draw on lessons learned at Prudhoe Bay and be closer to TAPS and its access to outside markets than onshore production to the west and Arctic resources offshore. But it also will need to be competitive with other parts of the world, especially when crude prices are depressed. That could be its biggest challenge.