Cook Inlet oil and gas lease is back on, seeking bidders

A canceled oil and gas lease sale is back on for Cook Inlet, but will anyone bid?
Published: Nov. 29, 2022 at 6:05 PM AKST
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ANCHORAGE, Alaska (KTUU) - In May, the Bureau of Ocean Energy Management canceled a lease sale in Cook Inlet citing a lack of interest from the industry. The last lease sale held in 2017 attracted just one bidder. But now, thanks to the Inflation Reduction Act —which requires the agency to offer leases again — Cook Inlet Sale 258 is back on.

“The demand for traditional sources of energy is not going away any time soon. In fact, the demand for oil and gas specifically is forecast to increase over the next 30 years,” said Kara Moriarty, Director of the Alaska Oil and Gas Association.

Moriarty was glad the sale was back on, she cited the importance of having the state develop its own resources.

“Why wouldn’t we want to get more oil and gas from an area like America, specifically Alaska, where we know we take care of the environment, we know we have lower emissions here, we know we have higher environmental standards here. Why wouldn’t we want to develop more here at home than in foreign countries?”

The tracks being offered are on federal lands in the northern part of Lower Cook Inlet. Some blocks have been removed to protect critical habitat for beluga whales and sea otters. But some environmental groups say the protections aren’t enough. In an email the Center for Biological Diversity wrote:

“Interior slightly decreased the amount of ocean habitat being auctioned off, but that can’t change the fact that more oil drilling means more harm to our climate and the Cook Inlet belugas, one of the world’s most endangered whale populations.”

Sue Mauger, Director of Cook Inletkeeper agreed. She said the nonprofit collected more than 90,000 public comments against the first lease sale and was disappointed that it was being offered now.

“At a time when we’re seeing such a change in our climate, to try to expand whole new areas for oil and gas is not the direction or the vision that we have for Cook Inlet,” Mauger said.

Moriarty defended the industry’s environmental track record in the Inlet, “for 60 plus years”, but said she couldn’t predict if the sale would be attractive to bidders.

“There’s no guarantee that companies are going to participate in a lease sale, and sometimes they do and sometimes they don’t. It’s a company-by-company decision,” Moriarty said. “But the one thing it doesn’t hurt, it doesn’t hurt to offer the lease sale and let the market respond whether it’s the right time to invest in a lease sale or not.”

The Bureau of Ocean Energy Management will accept mailed bids through Dec. 29. Bids will be open at 10 a.m. Alaska time Dec. 30. The event will be live streamed to the public.