Biden team gives nod to huge Alaska oil project, setting up climate fight

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President Biden came into office promising to end new oil drilling on federal land.

On Wednesday, his administration recommended permitting the largest upcoming oil development in the country — on federal land in Alaska.

The president is embroiled in a two-decade-long fight over an Arctic petroleum reserve, where the oil giant ConocoPhillips owns leases it bought from the government long before Biden was president. On Wednesday, a required environmental review said the project could best go forward with protections for birds, caribou and other wildlife by shrinking the project to three well pads from the originally proposed five.

It sets the stage for a final decision due next month and pushes one of Biden’s core pledges on conservation and climate change up against the limits of what the law allows. Although the administration has several times moved to slow or halt oil and gas development on federal lands, the ConocoPhillips project, known as Willow, shows the challenge that Biden confronts in fulfilling his promises.

“At the end of the day, every administration has to follow the law, even in some instances where they would prefer a different policy,” said David Bernhardt, an energy lawyer and former interior secretary in the Trump administration. “This is one example of the reality that there is an entire legal regime that provides for [oil and gas] leasing.”

At stake are resources in the federally owned National Petroleum Reserve-Alaska, the nation’s largest expanse of public land. There, ConocoPhillips plans to spend $8 billion to $10 billion, more than any other oil project on the table nationwide, according to consulting firm Wood Mackenzie. Willow is one of the most important projects to state leaders and several Native Alaskan groups, and it’s believed to be one of the surest oil reserves in the country.

The review released Wednesday, compiled by the Bureau of Land Management’s Alaska staff, estimated that the project could produce between 576 million and 614 million barrels of oil over 30 years. That would be enough for this one project alone to cover nationwide oil consumption for 30 days. And the company has previously said that its estimates are higher, as much as 3 billion.

The bureau, in a key development, identified a “preferred alternative,” a recommendation for the best proposal that can move forward. In this case, it is one with restrictions to shrink the project footprint to about 550 acres, nearly 12 percent smaller than ConocoPhillips’ original proposal. That would keep development out of a yellow-billed loon nesting site and caribou migration paths, the review said. It’s also in line with the minimum that company executives have publicly said that they need to make the project pencil out.

But reflecting the headaches this project poses to the administration, Interior Department officials emphasized Wednesday that no decision has yet been made and that they still have major concerns about the project’s environmental effects. In addition to hundreds of miles of roads and pipelines carving through often pristine wilderness, the review, known as a final supplemental environmental impact statement (SEIS), estimated that Willow would generate roughly 9.2 million metric tons of carbon dioxide a year.

“The preferred alternative is not a decision about whether to approve the Willow Project,” the Interior Department said in a separate news release. “The Department has substantial concerns about the Willow project and the preferred alternative as presented in the final SEIS.”

The Biden administration now has at least 30 days to mull a final decision. It will probably face intense pressure from environmentalists who want to kill it and oil advocates who say Willow would be a boost to domestic oil supplies and the state economy.

Under similar pressure as a candidate, Biden often sided with environmentalists. Campaigning in New Hampshire in 2020, he cited climate change as a reason to oppose drilling in the Arctic National Wildlife Refuge. He added: “And by the way, no more drilling on federal lands, period. Period, period, period.”

As president, he quickly moved to follow through on those promises from his first day in office. His administration briefly halted permitting for oil and gas drilling on federal land, canceled lease sales and delayed legally required new plans for oil and gas leasing plans in years to come.

But federal courts often overruled his decisions, forcing permitting and lease sales to go forward. Congress even intervened, with Sen. Joe Manchin III (D-W.Va.) pushing for provisions in last year’s climate and spending bill that mandated the Interior Department to sell leases.

For Willow, the leases ConocoPhillips controls date back to 1999 and the Clinton administration, and it operates two existing well sites in the same area. That legal standing gives the company formidable power in the permitting process and has made administration officials hesitant to try to simply block the company from drilling.

The company said Wednesday that it could work with the report’s recommended option, dubbed Alternative E, and mobilize this month to start construction as soon as the Interior Department makes its final decision.

“The three core drill sites in Alternative E … provide a viable path forward for development of our leasehold,” ConocoPhillips said in a news release.

“Willow will produce much-needed domestic energy while generating substantial public benefits,” added Erec Isaacson, president of the company’s Alaska arm.

Environmental groups are frustrated that the administration hasn’t worked more aggressively against Willow. And on Wednesday, they panned the Bureau of Land Management’s preferred alternative as insufficient. Environmental law firm Earthjustice, tallying the review’s own estimates, said Alternative E would cut the lifetime greenhouse gas emissions from the project by only 3 to 9 percent from ConocoPhillips’ initial proposal.

In just the past week, the administration has laid out a slew of conservation measures that were top asks among some of those groups. It moved to block logging and roads for more than half of Alaska’s Tongass National Forest; it banned mining for 20 years upstream of Minnesota’s Boundary Waters Canoe Area Wilderness; and it moved to block the Pebble Mine project to protect Alaska’s Bristol Bay watershed.

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But that doesn’t go far enough, because climate change is such an urgent crisis, said Abigail Dillen, Earthjustice’s president, echoing the comments Wednesday from many other environmental groups. The administration has pledged to cut nationwide emissions in half by 2030 from 2005 levels, making it difficult to square how it could greenlight an oil project as large as Willow that will keep producing for more than 25 years, they said.

Earthjustice had sued to overturn a rush of lease sales that the Trump administration had approved, hoping that would help the Biden administration find legal ways to get out of approving permits tied to those leases. Instead, the Biden administration has approved more than 6,000 federal oil and gas permits and, because of a surge in its first year, has approved more in total over two years than the Trump administration approved during its first two years, according to Interior Department data tallied by two environmental groups.

“Protecting these critically important places does not solve the problem that the federal government can’t meet U.S. climate goals without winding down its oil and gas business,” Dillen said. “They could be wielding their power in a lot more plausible ways to slow down oil and gas leasing. But they don’t seem interested in that.”

Asked about Willow at a White House briefing Wednesday, press secretary Karine Jean-Pierre rejected criticism from environmentalists. She said that the president is committed to prioritizing his fight against climate change but acknowledged that he is working within limits.

“The president has done more than any other president on this front,” she said. “He continues to deliver on historic climate change action while carrying out the law and meeting our energy needs.”

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The administration has kept some of its environmental ambitions in check while managing other crises. Shortfalls in commodity markets last year led administration officials to obsess over energy prices, even asking oil produces in the United States and abroad to pump more. And to ensure support for its agenda in a divided Congress, the administration has at times offered olive branches to moderates in Alaska’s delegation, Rep. Mary Peltola (D) and Sen. Lisa Murkowski (R).

Both are supporters of Willow, allying themselves with local Native American groups. Many of these groups are in line for a slice of the project’s revenue, although some in the nearest town, Nuiqsut, are concerned about the project’s effects.

Murkowski, along with other Alaskan leaders, said they plan to keep pushing for the administration to approve the preferred option from Wednesday’s review. ConocoPhillips has said it may abandon the project if the administration pursues further restrictions, such as limiting the area to two or fewer well pads — a decision Alaskan leaders want to avoid.

“I urge the administration to maintain a viable project by selecting Alternative E — without further limits or extraneous conditions,” Murkowski said in a statement. “Thousands of good union jobs — and immense benefits that will be felt across Alaska and the nation — will hang in the balance until a positive final decision.”

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