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Arctic refuge lease sale flops, as major oil companies skip out

The Trump administration’s recent auction for oil drilling leases in the Alaskan Arctic attracted no major oil companies.

The Trump administration’s recent auction for oil drilling leases in the Alaskan Arctic attracted no major oil companies.

The land totals 1.1 million acres and the government of Alaska was the sole bidder and ended up winning leases on 9 of the 12 parcels that received bids. Only two were acquired by private companies, and the others that received no interest were withdrawn from this round of auctions.

The area, known as the coastal plain, provides rich habitat for seabirds, polar bears, caribou, and other animals.

The leases were expected to draw $1.8 billion in revenue over ten years, enough to “offset tax cuts”, concern over a lack of interest led the state development company, the Alaska Industrial Development and Export Authority (AIDEA), to authorize $20 million in emergency spending to pick up some of the leases. The ones that went unsold will be offered again during the next lease period, while those that were picked up are available for 10 years. AIDEA says it will look for private companies that are interested in the leases it does hold.

Alaska Oil and Gas Association CEO Kara Moriarty said in a statement, “Today’s sale reflects the brutal economic realities the oil and gas industry continues to face after the unprecedented events of 2020, coupled with ongoing regulatory uncertainty,”

Photo by: Christoper Miller

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