US Interior Department cancels prospective lease sales for Arctic drilling

US Interior Department cancels prospective lease sales for Arctic drilling

Less than a month since Shell’s surprising decision to pull out of Arctic oil exploration, the US government’s Interior Department cancelled two prospective oil and gas lease sales in the region, according to Bloomberg.

Friday’s decision effectively ends all fossil-fuel drilling activity in US Arctic waters.

Shell’s September 28 decision was made for commercial reasons in that the company felt there were not enough encouraging signs from preliminary drilling in the Chukchi Sea off Alaska for it to risk any more than the $7bn it had already committed to the venture.

The Interior Department’s decision cancelled plans to offer offshore drilling leases for 2012-2017 covering around 55 million acres in the Chukchi Sea and 65m acres the Beaufort Sea respectively. It reflects a lack of interest from companies to acquire such leases, especially following Shell’s pullout.

In another move in a similar vein, Interior’s Bureau of Safety and Environmental Enforcement (BSEE) denied requests from Shell and Norway’s Statoil to retain their existing Arctic leases after they expire in the next five years.

Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.

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