Bristol Bay Native group backs oil drilling

Posted: Sunday, June 15, 2003

ANCHORAGE (AP) In a dramatic turnabout, a powerful group of Bristol Bay Natives has endorsed the idea of oil development in the region, even offshore.

''There is widespread to almost unanimous support for onshore, and mixed support for offshore drilling,'' Paul Roehl, vice president of land and development for Bristol Bay Native Corp., told Petroleum News.

Bristol Bay has long been thought to hold commercial quantities of oil and gas, but the uproar in the wake of the 1989 Exxon Valdez oil spill called a halt to development there.

Local residents who have depended on the region's rich fish resources, particularly salmon, have been reluctant to support oil development after the spill coated vast areas and shut down fishing in nearby regions of Alaska.

But now the fishing industry is on the ropes, and oil development is looking much more attractive. The Bristol Bay Native Corp. has rallied local leaders to assure the oil industry that the region is now open to that business.

The corporation itself favors immediate exploration and development of the outer continental shelf, where leases were sold nearly 15 years ago. The North Aleutian Basin Sale 92 area went to bid in October 1988 and the federal government received $96 million in bids for 23 leases totaling 122,000 acres.

But the Exxon Valdez spill a few months later intensified opposition to the sale. It was eventually canceled and the bid proceeds returned to the oil companies. Currently the area is under a development moratorium, and the U.S. Minerals Management Service doesn't plan to revisit it until 2011.

The corporation would like to see the moratorium lifted early, to create high-paying jobs for the people of the region, particularly in the light of recent disastrous commercial salmon seasons, which have had a big impact on the region's economy.

''Salmon alone can't support the region anymore,'' said Greg Beischer, senior geologist with Bristol Environmental & Engineering Services Corp., a subsidiary of Bristol Bay Native Corp.

The 1988 lease sale occurred at a time when Bristol Bay salmon brought as much as $2.60 per pound, while oil sold for $17.20 a barrel, Roehl said. Today salmon brings only about 40 cents per pound and oil sells for close to $30 a barrel.

Back in 1995, U.S. Rep. Don Young, R-Alaska, made a case for keeping oil rigs out of the bay.

''All told, the commercial fisheries have an average annual wholesale value approaching $1 billion and employ more than 10,000 Americans,'' he said at the time. ''The area of the Sale 92 leases is also the heart of a major migration, staging and feeding area for numerous marine mammals, seabirds and waterfowl. The commercial and intrinsic value of the region's marine life is too great to put at risk for the small amount of estimated recoverable oil reserves in the North Aleutian Basin.''

Today, however, the region's leaders are taking a different approach.

''We have some 'not in my backyard' holdouts,'' Roehl said, ''But the younger generation is more progressive on oil and gas development.''

Roehl says the corporation will insist that oil development be done in an environmentally sound manner, with maximum protection to the fish resources.

''Culturally, spiritually, salmon are very vital to the region,'' he said. ''We must preserve fisheries.''

But the corporation wants to move forward on oil development as well. It has approached the state to fund a $450,000 Bristol Bay basin analysis, to be performed by the Arctic Energy Technology Development Laboratory at the University of Alaska Fairbanks.

The study would pull together old well logs and other documents, and digitize what seismic data exists on the area. Corporation officials hope the availability of data in a comprehensive study would prime the interest of oil companies.

In addition to direct economic benefits of oil development, Roehl said adding a local energy source would stimulate other industry.

''There is a big need to reduce the cost of energy in Alaska,'' Roehl said. ''Low-cost energy makes other mineral development possible.''

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