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Alaska up for first offshore lease since 2008

Staff Writer |
After an environmental review, the U.S. government said it was putting a section of the Alaskan coast up for auction for oil and gas explorers.

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"We conducted a robust environmental analysis and look forward to holding Alaska's first Outer Continental Shelf lease sale since 2008," Walter Cruickshank, the acting director of the Bureau of Ocean Energy Management, said in a statement.

The lease is the thirteenth and final lease sale under a leasing program enacted by former President Barack Obama. It is not related to recent executive actions taken by President Donald Trump that call for a review of Obama's ban on Arctic oil and gas exploration.

The sale announcement comes as the state deals with a budget crisis. This week, Alaska Gov. Bill Walker called lawmakers to a special session to tackle economic uncertainty, saying the state can't afford to draw on its savings any longer.

More than $3 billion in bids were generated under the five-year lease plan that started in 2012.

The lease covers about 1 million acres off the south-central Alaskan coast in the Cook Inlet.

The region boasted its first oil discovery in the 1950s and set in motion the state reputation as an energy producer. Oil production peaked in the 1970s at 230,000 barrels of oil per day and dwindled to around 30,000 bpd in the early 2000s.

According to the Alaska Oil and Gas Association, the situation is similar for natural gas and by the last decade, it was thought that about 90 percent of the regional reserves were depleted.

A 2011 study from the U.S. Geological Survey put the reserve estimate at a mean 599 million barrels of oil and a mean 19 trillion cubic feet of natural gas for technically recoverable undiscovered resources onshore and in state waters that are part of the Cook Inlet.

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