Lease Activity? Royalties? T-Lake?
June 30, 2006
11:42 AM
This letter to Interior Secretary Kempthorne conveys concerns about an oil and gas lease sale scheduled for this September in the National Petroleum Reserve-Alaska (NPR-A).
While some 2.8 million acres of the NPR-A are already under lease, only a single well was drilled there in the past drilling season, raising questions about the effectiveness of Federal requirements for developing leases. Also, the letter emphasizes the need to ensure that the American public receives a fair return for the oil and gas resources that they own.
Secretary Norton, before she left the Department of the Interior, set in motion a process to lease another large portion of the NPR-A for oil and gas activities. New lands to be offered include 200,000 environmentally-sensitive acres north of Teshekpuk Lake -- acres that even the Reagan Administration did not think should be open for development.
While Sen. Bingaman supports oil and gas development on Federal lands, including in the NPR-A, he is concerned about this lease sale and how resources in the NPR-A are managed. Eighteen other Senators joined Sen. Bingaman in urging Secretary Kempthorne to review the matter and reconsider the decision to lease previously-protected areas near Teshekpuk Lake:
June 29, 2006
The Honorable Dirk Kempthorne
Secretary
U.S. Department of the Interior
1849 C Street, N.W.
Washington, D.C. 20240
Dear Secretary Kempthorne:
We are writing because we are concerned about aspects of the Department of the Interior’s management of the National Petroleum Reserve-Alaska (NPR-A). The Department is preparing to conduct a lease sale in the Northeast NPR-A Planning Area this September, and we want to bring these issues to your attention.
We are advised that 2.8 million acres of the NPR-A are already under lease, but only one well was drilled in the past drilling season. We recognize that this situation may be exacerbated by provisions in the Energy Policy Act of 2005, which allow lessees to hold federal lands without production for 30 years and permit leases to be joined into large production units. While we appreciate that conditions for development are difficult on the North Slope, we are concerned that these provisions could be implemented by the Department to allow oil and gas companies to hold leases for lengthy periods without production of the domestic oil and gas resources that Americans need.
We are also concerned that the law may be interpreted to allow production of quantities of oil and gas in the NPR-A without the payment of royalties, and that royalty relief may be extended in situations where it is not warranted. We strongly believe the public must get a fair return for the production of federal oil and gas resources resulting from any lease sale on the NPR-A.
Finally, we have serious reservations about the impacts of the proposed Northeast NPR-A lease sale on the environment and subsistence users. The additional lands that are scheduled to be leased in September include some 200,000 acres that even Secretary James Watt didn’t think should be developed in the area near Teshekpuk Lake.
As the new Secretary of the Interior, you have the opportunity to take another look at these issues. We encourage you to do this and to take any steps necessary to address these issues. Furthermore, we urge you to reconsider the decision to lease previously protected areas in the vicinity of Teshekpuk Lake, and in particular, those areas put off limits by Secretary Watt.
Thank you for your attention to this matter. We look forward to your response.
Sincerely,
Bingaman Salazar Menendez Feingold Sarbanes Jeffords
Lieberman Wyden Reed Cantwell Schumer
Lautenberg Feinstein Boxer Akaka Clinton
Bayh Dodd Kerry
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