Obama’s Incomplete Arctic Energy Approach

Obama WaveBy Andreas Kuersten

The Hill

As President Obama tours Alaska this week, cries of hypocrisy fill the air.  He is using these three days to highlight the effects of climate change and continue his call for action.  Meanwhile, off the state’s northwest coast in the Arctic Chukchi Sea, Shell continues its exploration of offshore oil reserves in the wake of receiving its final federal permit to drill in the region.

At first glance, the dichotomy between the President’s words and actions in America’s “Last Frontier” appears stark.  Obama is championing the weaning of the world off of dirty fossil fuels while allowing an operation that could result in the extraction and consumption of billions of barrels of these exact substances.  But closer examination reveals that he is actually engaging in a considered and balanced approach to the country’s energy security.  While other problems exist with the President’s overall Arctic energy approach, hypocrisy is not one of them.

America is currently awash in oil due to the unanticipated and profound effectiveness of new technology to access shale oil reserves.  Moreover, tapping shale reserves is a good deal cheaper than accessing those offshore in the Arctic.  Yet prudent energy policy requires more than just a short-term view.  As put by Steve LeVine of Quartz, “[C]rude oil remains scarce if you are thinking in terms of decades.  At some point—perhaps toward the second half of the century—the cost of Arctic drilling will likely be more economical, and the need for its oil will probably be much greater.”

Even if America were to move away from fossil fuel reliance at Obama’s desired pace—or even faster, for that matter—it would still maintain quite an appetite for them for a good length into the future.  In addition, the typical delay between exploration and pumping for an offshore oil well can approach a decade, and will likely approach two decades in the case of the relatively infrastructureless and harsh weathered Arctic.  This means that Shell’s current exploits are unlikely to come to fruition until much closer to mid-century, and the oil supply situation is likely to have changed in the meantime.

Valdez AlaskaIt is therefore not hypocrisy to guide America and the world away from fossil fuels while ensuring that our still very fossil fuel dependent economy does not run out of domestically sourced—and therefore more secure—energy over the course of this transition.  Arctic offshore reserves are some of the last substantial reservoirs of these fuels within the United States, and ensuring that they will be ready when needed—though hopefully needed in far lesser amounts—appears prudent.

It should also be noted that Obama was placed in a difficult position from the start in that Shell and other energy companies had already paid the U.S. Government billions to secure their Arctic offshore leases under the Bush Administration.  Even if the President had wanted to, reneging on these contracts would have meant the return of large sums of money, which had more than likely already been budgeted and allocated.

Finally, alongside his allowance of Arctic offshore drilling, Obama has also closed additional Alaskan territory to developers and increased the safety measures that must be put in place in order to drill for offshore oil.  This approach has ultimately led to vocal complaints from both environmentalists and industry.  As a result, David Bolton, deputy assistant secretary for oceans and fisheries with the State Department, said, “Maybe that means we’re in the right place, given that people on both sides are unhappy with us.”

But, energy security aside, the Administration’s Arctic energy approach is still not in the right place.  The widespread discussion of climate change hypocrisy is blinding the country to Obama’s true Arctic failings: Inadequate focus on regional infrastructure and development, which, in turn, leads to local environmental and economic insecurity in the face of offshore oil exploration and drilling.

KotzebueArctic projects must be carried out responsibly so that the region’s environment and living spaces are protected while benefits accrue to locals.  The Government has made much of the fact that it has upped its safety requirements since Shell’s disastrous 2012 oil exploration effort, and it is definitely a positive that the company must take additional steps to secure its equipment and operations and have an extra rig nearby in case of a blowout.  But these measures cannot make up for the overall lack of infrastructure in the region.  There are simply not enough ships, deepwater ports, communications capabilities, or disaster response resources to reasonably undertake large-scale Arctic energy ventures in the face of their many risks.

In addressing this, the Obama Administration has been sorely lacking in action.  It remains silent on measures aimed at improving northern infrastructure that languish in congressional committees while green lighting oil activities for a corporation with a very recent and poor history in the Arctic.  Such initiatives should be part of any approach to Arctic energy and would benefit both industry and environmentalists by generally improving their ability and lowering their costs to act in the far north and adding responsive capacities in the event of an accident.

Moreover, on a broader scale, northern Alaskan communities—particularly native communities—suffer some of the worst health, education, and economic outcomes in the United States, in large part due to infrastructure that lags substantially behind the rest of the country.  But there are few avenues available to turn this situation around by bringing in investment and services.  Energy and other resource projects and the money and activities that accompany them are by far the most valuable of these.  These projects must, however, comprehensively mitigate the risks of their actions and improve the communities in the vicinity of which they work.

The funding of local infrastructure projects is the route to accomplish all of the above.  Whether by the government or energy companies operating in the region, such funding would have important dual regional impacts.  First, it would greatly advance the safety of Arctic resource operations and of the communities near them.  Second, it would improve the lives and opportunities of residents.

DenaliA comprehensive Arctic energy approach entails focusing on infrastructure and local populations.  By failing to support and highlight the positives of Arctic infrastructure initiatives—such as improved business operations, enhanced safety and disaster responsiveness, and desperately needed northern development—the President is insufficiently addressing Arctic needs, and also missing out on political points with industry, environmentalists, and locals.  It is in both his and the Arctic’s best interests to adopt a more complete energy approach to the region.

As Obama makes the rounds in Alaska this week banging the important drum of climate change, let him not forget the neighboring drum of safety and development in the American Arctic.

Continue to article . . .

Picture 1: SSgt Jarad A. Denton [Public domain], via Wikimedia Commons

Picture 2: Joint Pipeline Office (http://www.jpo.doi.gov/Photo%20Gallery/index.htm) [Public domain], via Wikimedia Commons

Picture 3: National Park Service, Alaska Region [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)%5D, via Wikimedia Commons

Picture 4: Nic McPhee from Morris, MN, USA (Denali lifts her skirts) [CC BY-SA 2.0 (http://creativecommons.org/licenses/by-sa/2.0)%5D, via Wikimedia Commons

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