Author: Edward

The Trump Administration’s Plan to End the Production of Oil from the Kuparuk Oil Field

The Trump Administration’s Plan to End the Production of Oil from the Kuparuk Oil Field

Oil giants sell thousands of California wells, raising worries about future liability | Reuters

In November 2017, the Obama administration unveiled an ambitious plan aimed at ending the production of oil from the world’s most prolific and environmentally harmful offshore drilling site, the vast Arctic oil platform Kuparuk in Alaska. The idea was to force the companies on the platform to cease production and hand their operations over to the US government, which would then lease the platform itself for oil production. At the time, President Donald Trump was in the process of pushing through an Alaska energy bill, which included the possibility of leasing the Kuparuk oil field to drillers and the potential for a new oil refinery at a cost, possibly $1 billion.

But by May, the Kuparuk project had collapsed, the companies on it all withdrew from the deal, and the Obama administration abandoned it all, with Trump’s Department of Interior in charge of oil lease sales on the platform. In response, the Trump administration announced it had approved the sale of one of the three platforms on the Kuparuk lease block: the Enbridge-operated Horizon, operated by Anadarko, and the TransCanada-operated T Strec company. The latter had operated on lease for many years, but was recently acquired by Marathon.

An even larger project involving a single platform, the Kaskawulik Kuparuk oil field, is currently under development, with companies including Chevron and Royal Dutch Shell also having stakeholds in the lease block. Yet this project is even more sensitive to Trump’s plans to increase the output of fossil fuels from US waters and his rejection of climate change. The Kaskawulik Kuparuk oil field contains the second largest unexploited US offshore reserve, after the deepwater Horizon Platform, with deposits over two hundred billion barrels of oil and an estimated eight trillion cubic feet of gas.

For now, the oil companies involved in the Kuparuk project are in a holding pattern. Shell sold its stake to Anadarko (see map above), and Chevron and Anadarko have both said they will stay out of the field while the legal wrangles around Arctic drilling are resolved (see here and here for more). In other words, the Kuparuk field is off to a better start and, in the

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