The Biden administration has given final approval to an Alaska oil project in the face of an environmental uproar as it seeks to tread a line between energy security and climate concerns.
ConocoPhillips’ $8bn Willow project in the oil-rich area known as the North Slope can now proceed to drilling after the US Department of the Interior on Monday authorised a slimmed-down version.
Expected to produce about 180,000 barrels a day at its peak, Willow would account for roughly 1.5 per cent of current US oil production. The project would help to reinvigorate the oil industry in Alaska, a state where production has slid to less than a quarter of the 2mn b/d produced in boom years of the 1980s.
The approval process presented a dilemma for president Joe Biden, who vowed on the campaign trail to crack down on new drilling by the oil industry but has since implored producers to pump more oil after petrol prices rose in the wake of Russia’s invasion of Ukraine. The US Bureau of Land Management recommended the project approval last month.
The interior department, which controls the federal land where the Willow project would be developed, on Monday said it was “substantially reducing” the size of the project, cutting it to three drilling sites from the five initially proposed.
The administration also announced measures to limit future development of the 23mn area known as the National Petroleum Reserve, including adding another 2.8mn acres to 13mn already off limits to future drilling, and proposing a new rule to curtail activity in other parts.
Ryan Lance, ConocoPhillips chief executive, called the government approval “the right decision for Alaska and our nation”. He said the project fit within the Biden administration’s priorities on “enhancing our energy security . . . while creating good union jobs and providing benefits to Alaska Native communities”. Many local indigenous groups have backed the project.
Environmentalists have attacked the project, saying it would further boost carbon emissions that drive climate change. A TikTok campaign against the project drew support among younger activists, with the hashtag #willowproject attracting more than 94mn views over the past month.
Christy Goldfuss, chief policy impact officer at Natural Resources Defense Council, described the decision as a “grievous mistake”.
“It green-lights a carbon bomb, sets back the climate fight and emboldens an industry hell-bent on destroying the planet. It’s wrong on climate and wrong for the country,” she said.
The project was initially approved by the Trump administration, but was halted in 2021 after a federal judge deemed the initial environmental review flawed. The Biden administration has defended the project in court.
Willow was not the only US energy project to make progress on Monday. In Louisiana, the liquefied natural gas developer Venture Global committed to a big expansion to an export plant it is constructing.
The enlarged scope of the Plaquemines LNG project will bring its total cost to $21bn and make it one of the largest gas export plants in the US. The expansion, underpinned by sales contracts with Chinese buyers as well as ExxonMobil and Chevron, reflects surging global demand for US gas after Russia’s full-scale invasion of Ukraine and subsequent energy war on Europe.
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