Another company gives up lease in Alaska’s Arctic refuge

Aug 23, 2022, 10:37 AM | Updated: 10:40 am

ANCHORAGE, Alaska (AP) — An Alaska state corporation is the only remaining leaseholder in the Arctic National Wildlife Refuge that intends to pursue plans to explore for oil and gas on the refuge’s coastal plain after another private company gave up its lease in the region.

The U.S. Bureau of Land Management said Knik Arm Services, a small real estate and leasing firm, asked to have its 49,000-acre (76.5 square-mile) lease rescinded and lease payments refunded. The federal agency said it will honor the request made last week, the Anchorage Daily News reported.

Knik Arm Services was one of two private companies that won leases in a sale held in the waning days of the Trump administration. The other, oil company Regenerate Alaska, gave up its lease earlier this year.

The Alaska Industrial Development and Export Authority, a state corporation, acquired seven leases in the sale. It is suing federal officials over what it calls improper actions that are preventing lease activities. The corporation got the leases to preserve drilling rights in case oil companies did not come forward.

Mark Graber, who owns Knik Arm Services, said he invested about $2 million into his lease and for a first-year lease payment. He said he had wanted to hold onto his lease in hopes that the state corporation prevailed in its lawsuit and that oil development would produce royalties for his company. But he said the fight over the leases could take years.

“I wish AIDEA all the success in the world. They are doing something that is in the interest of Alaskans and the U.S., for that matter,” he said.

A federal law passed in 2017, with support from Alaska’s congressional delegation, called for lease sales on the coastal plain, but the Biden administration suspended the leases and is reviewing the leasing program. Interior Secretary Deb Haaland last year said the Interior Department would conduct a new environmental review of the leasing program.

Alan Weitzner, executive director of the Alaska Industrial Development and Export Authority, said the decision by Knik Arm Services does not change the corporation’s plans.

“There’s too much at risk not to (pursue exploration), when we talk about the potential for jobs and economic development for the state,” Weitzner said.

Separately, Hilcorp and Chevron previously canceled interests in older leases within the refuge’s boundaries, on a small tract of Alaska Native corporation-owned land.

The Gwich’in Steering Committee, which represents 15 Gwich’in communities in Alaska and Canada, in a statement said the decision by companies to give up leases shows that drilling in the refuge is not worth the economic risk. The Indigenous Gwich’in have expressed concern about impacts to a caribou herd they rely on for subsistence.

“These lands are sacred, and we – the Gwich’in people – will never give up fighting to protect the Arctic Refuge,” said Bernadette Demientieff, the group’s executive director. “We call on Congressional leaders and President Biden to recognize the rights of Indigenous communities that are being overlooked in Alaska and repeal the oil and gas program in the Arctic Refuge.”

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Another company gives up lease in Alaska’s Arctic refuge