Judge Halts Alaska Coast Oil, Gas Development

(AP)  A federal judge on Wednesday stopped companies from developing oil and gas wells on billions of dollars in leases off Alaska's northwest coast, saying the federal government failed to follow environmental law before it sold the drilling rights.

The lease sale in February 2008 brought in nearly $2.7 billion for the federal government from the sale of 2.76 million acres in the Arctic waters of the Chukchi Sea, including $2.1 billion in high bids submitted by Shell Gulf of Mexico Inc.

U.S. District Judge Ralph Beistline said that the Minerals Management Service failed to analyze the environmental effect of natural gas development despite industry interest and specific lease incentives for such development.

The agency analyzed only the development of the first field of 1 billion barrels of oil - despite acknowledging that the amount was the minimum level of development that could occur on the leases.

Beistline enjoined all activity under the lease sale pending additional environmental reviews.

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The decision comes after the massive oil spill from a BP PLC well in the Gulf of Mexico and is a blow to the unit of Royal Dutch Shell PLC, which had hoped to drill three exploratory wells this summer in the Chukchi Sea. Those plans were halted with President Barack Obama's decision in May to delay offshore oil drilling in the Arctic Ocean until at least 2011.

Offshore drilling is strongly supported by Alaska Gov. Sean Parnell and other elected officials in the state, where upward of 90 percent of general fund revenue is provided by the petroleum industry.

However, environmental and Alaska Native groups have long contended it would be impossible to clean up a spill in icy Arctic waters, far from deep water ports and airports.

The nearest Coast Guard base is on Kodiak Island more than 1,000 miles away.

[Skruffy1]

I knew there'd be shouts of "communist" and "Obama's trying to cripple us" when this came out. Relax, folks! This is a temporary holdup pending environmental review, and it applies to only one area off the northwest coast of Alaska... NOT all Alaska oil production. Not by a long shot.

This is not like "grounding all airlines if one plane crashes". This is like temporarily grounding one kind of airplane when a safety problem is detected, or if a problem was discovered in certification... if you insist on using the airliner analogy.

Yes, BP's safety and environmental record is lousy compared to other companies, but oil is a risky and dirty business.

[thy-only_king]

Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world. It is more than 2 TRILLION barrels. On August 8, 2005 President Bush mandated its extraction. In
three and a half years of high oil prices none has been extracted. With this motherload of oil why are we still fighting over off-shore drilling?

[sjc_1]

That is shale oil that is harder to recover that Canada tar sands.

[RobAla]

A moratorium on drilling in the gulf is absolutely idiotic. Hundreds of companies have safely drilled for almost 50 years, and they all are punished because one foreign oil company acts irresponsibly? This is like ground all airlines for 6 months if one plane crashes. 10s of thousands of hard working Americans will be thrown out of work, when the country is experiencing huge unemployment!!!! This is crazy.

And now this judge wants to shut down drilling in Alaska because the federal government screwed something up?

President Obama and this judge seem to be intent on crippling this nation. This is insanity.