U.S. vows first oil lease sale in Alaska Arctic refuge this year

ANCHORAGE, Alaska (Reuters) - The U.S. Interior Department is determined to sell oil leases for the first time this year in the ecologically sensitive but presumably petroleum-rich coastal plain of Alaska’s Arctic National Wildlife Refuge, a Trump administration official said on Thursday.

“That lease sale will happen in 2019,” Joe Balash, the assistant interior secretary for lands and minerals management, told an oil industry conference in Anchorage.

The decision marks a likely turning point in a decades-long battle between environmental groups and fossil energy companies over the Beaufort Sea coast of the wildlife refuge, home to caribou, polar bear and other Arctic wildlife east of Alaska’s North Slope oil fields.

The refuge had been off-limits to oil and gas drilling until the end of 2017, when Congress passed a tax overhaul that included a mandate for oil leasing there.

The tax bill requires the Interior Department to hold a lease sale within four years, offering at least 400,000 acres for development within the coastal plain of ANWR, America’s largest wildlife sanctuary.

The Interior Department’s Bureau of Land Management issued a draft environmental impact statement last year and will follow up with a final report this summer, likely by August, Balash said. A record of decision and notice of lease sale will follow, he said.

Environmentalists have criticized the swiftness of the environmental review. One environmental leader predicted legal challenges.

“If they really stick with that timeline, then they’re likely going to be violating several environmental laws,” said Adam Kolton, executive director of the Alaska Wilderness League.

“This is being rushed faster than any area we’ve ever seen in the American Arctic and almost any area in the United States. It’s about meeting a political clock,” he said.

The U.S. Fish and Wildlife Service, another branch of the Interior Department, criticized the draft environmental review in April, saying the study failed to adequately consider the possibility of oil spills, climate change and the welfare of polar bears that inhabit the area.

Fish and Wildlife identified dozens of other information gaps in its 59 pages of comments and implied that the Interior Department’s Bureau of Land Management wrote the draft study without properly consulting wildlife regulators.

Canadian government authorities from the federal to tribal level have also panned the draft, saying it fails to properly evaluate threats to the Porcupine caribou herd that roams the Alaska-Canada border area.

The herd, one of the largest in North America, uses ANWR’s coastal plain as its birthing grounds. Porcupine herd caribou are hunted by the indigenous Gwich’in people who live on both sides of the border and the herd is the subject of a U.S.-Canada treaty.

Balash said he traveled to Ottawa last week and has addressed Canadian concerns.

“We fulfilled our obligations there to consult with the Canadian government on the Porcupine herd,” he said.

ANWR covers some 19 million acres of Alaska’s North Slope, overlying around 16 billion barrels of recoverable crude oil reserves, according to federal officials.

Reporting by Yereth Rosen in Anchorage, Alaska; Editing by Steve Gorman, Sandra Maler and Lisa Shumaker