100m acres have been protected from offshore exploration, but the petroleum industry is confident that the law can be circumnavigated, write Jennifer A Dlouhy and Josh Wingrove
US president Barack Obama banned new offshore oil and gas drilling in 100m acres of the US Arctic and undersea canyons in the Atlantic Ocean. That is certain to provoke a fight with the Republican-led Congress and his successor in the White House, Donald Trump.
In an announcement co-ordinated between the US and Canada, two of the world’s biggest oil producers, Canadian prime minister, Justin Trudeau, also committed to freezing new offshore leasing in his nation’s Arctic waters and to reviewing the matter every five years.
“These actions, and Canada’s parallel actions, protect a sensitive and unique ecosystem that is unlike any other region on Earth,” Obama said in a written statement. “They reflect the scientific assessment that even with the high safety standards that both our countries have put in place, the risks of an oil spill in this region are significant and our ability to clean up from a spill in the region’s harsh conditions is limited.”
The US move — announced a month before Obama leaves the White House — is sure to draw a legal challenge, and there is scant precedent. President-elect Donald Trump could rescind the order, but the 1953 statute Obama is invoking doesn’t include an explicit provision for reversal, and that question could be tied up in court for years.
Although Obama’s decision was cast primarily as safeguarding 31 ecologically precious Atlantic canyons and “fragile Arctic waters,” it was a major victory for environmental activists. They have been arguing that even broader climate change concerns should drive the White House to rule out drilling in mostly untouched US waters. Environmentalists said the decision sends a message to the world that the US knows the warming Earth can’t afford to burn “extreme oil” locked under now-protected parts of the Arctic and Atlantic.
“Today’s bold, bi-lateral announcement, between Canada and the United States, shows North America is leading the world in preserving the Arctic for future generations,” said Rhea Suh, president of the Natural Resources Defence Council. “President Obama and Prime Minister Trudeau have created an indelible legacy, as true stewards of the most fragile and threatened ecosystem in the world, and we urge the other Arctic leaders to follow suit.”
In a joint statement, the US and Canada said their actions “set the stage for deeper partnerships with other Arctic nations,” including Russia, which has not taken a similar step to broadly rule out drilling in the region.
In the US Atlantic, the massive underwater canyons covered by Obama’s order were carved by glaciers, or are the remnants of rivers that once flowed overland. According to a White House fact sheet, they are home to many species of fish, whales, and other aquatic life and have been the subject of scientific exploration for decades.
The announcement builds on Obama’s earlier decision to rule out selling new leases in the Arctic, Atlantic, and Pacific from 2017 to 2022. But Tuesday’s proclamation, based on the so-called 12(a) provision of the Outer Continental Shelf Lands Act, is different, because it explicitly puts certain areas indefinitely off-limits for oil exploration and production.
Until now, the Outer Continental Shelf Lands Act provision has been used mostly to indefinitely preserve coral reefs, walrus feeding grounds, and marine sanctuaries. Some presidents have used it more broadly, but temporarily.
Although presidents have modified a predecessor’s decisions under the act, they have never rescinded them. A legal opinion from the US attorney general in 1938, on similar designations under a different law, said they “do not imply a power to undo.” And there have been no federal court rulings on the offshore energy statute.
But the law doesn’t include an explicit statement that the protections are permanent — a potential opening for offshore drilling advocates.
There’s no such thing as a “permanent withdrawal,” said Christopher Guith, a senior vice-president at the Chamber of Commerce’s Institute for 21st Century Energy. “Any 12(a) withdrawal can be made via presidential memorandum and can be repealed via presidential memorandum.”
Trip Van Noppen, president of Earthjustice, said the scientific underpinnings of Obama’s order will buttress it in court. “It’s important, in general, to have a strong rational basis for the decision, and the fact of local impacts guiding the decisions is important in justifying the decisions.”
Although the US Arctic is estimated to hold 27bn barrels of oil and 132 trillion cubic feet of natural gas, energy companies have struggled to tap those resources, because of high exploration costs and long development timelines. Oil companies spent $2.5bn nabbing drilling rights in the region, but relinquished many of those claims, as low crude prices forced them to cut spending.
But the industry’s top trade group, the American Petroleum Institute, is confident that the Arctic withdrawals will be rolled back by Trump, even if the matter is ultimately decided by federal courts. “There’s a number of avenues to explore to overturn a withdraw,” said Andy Radford, offshore senior policy adviser at API.
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