A misguided energy ambition
A 2017 Republican bill allowed the Arctic National Wildlife Refuge to be opened for oil and gas development. The Trump administration is now acting with due haste to ensure at least one company makes a bid before the November election.
Joe Biden has already promised to block drilling in the refuge; however, once rights are sold to companies it’s harder for any future president to reverse course.
ANWR is the largest wildlife refuge in the country and covers nearly 20 million acres in the northeast corner of Alaska. The coastal plain where drilling would commence is considered the “biological heart” of the Arctic Refuge, and is home to dozens of land and marine mammal species, as well as fish and migratory birds that will be at risk of habitat destruction from industrial- scale drilling.
It would be impossible to leave no trace in this area when a network of roads, pipelines and well pads must be built to access the oil. ANWR was designated a refuge to protect the land, water and wildlife from the very infrastructure that would all be needed to extract the fossil fuels.
Banks have already determined that destroying a wildlife refuge is bad for business. Morgan Stanley, Goldman Sachs, JPMorgan Chase, Wells Fargo and Citigroup — five of the six largest banks in the U. S. — have all decided to avoid the public relations nightmare that would result from financing this type of heavy industry.
Will oil companies follow suit? In 2015, Royal Dutch Shell abandoned its Arctic Ocean operations after spending upward of $ 7 billion, citing low oil prices and underwhelming output, compounded by global pressure to cease operations because of climate change concerns.
In 2020, demand for oil has collapsed, U. S. prices have turned negative for the first time ever and the world is experiencing an oil glut, which is why the timing of an expensive project in the Arctic is especially unfavorable.
“We think there is almost no rationale for Arctic exploration,” Goldman Sachs analyst Michele Della Vigna said. “Immensely complex, expensive projects like the Arctic we think can move too high on the cost curve to be economically doable.”
Since the 1980s, Republicans have supported drilling in the Arctic to increase domestic production and reduce foreign oil dependence; however, the fracking boom has made the U. S. the world’s leading oil producer, and the justification for going into the Arctic to find new resources now appears harder to sustain.
Drilling in the refuge is particularly unpopular with Americans. When the bill passed in 2017, a Yale University poll showed that 70% of voters opposed the idea, including a majority of Republicans. In an April 2019 poll, those numbers remained virtually unchanged.
There will always be a debate about how to balance economic development with resource protection; however, the push for drilling in the Arctic is a misguided policy.
ANWR has been untouched for decades and should remain in a wild state.