Murkowski proposes directional drilling in ANWR

JUNEAU -- Environmental groups said they would fight any legislation that would let oil companies drill sideways from outside the boundaries of the Arctic National Wildlife Refuge into its oil and gas reserves, predicting it would be "dead in the water" under the Obama administration.
Their response came within hours of U.S. Sen. Lisa Murkowski's announcement Thursday that she planned to introduce a bill that would allow for use of a technology called directional drilling under the surface of the coastal plain -- a relatively small but controversial area on the northern edge of the refuge.
Directional drilling is common in Alaska's oil fields and the idea to use it to siphon oil from the federal refuge isn't new.
During his recent Senate race, Mark Begich, a Democrat, promoted directional drilling into ANWR. So did Frank Murkowski when he was the state's governor and earlier when he was U.S. senator.
But environmentalists aren't the only barrier.
Tapping ANWR from state land would require drilling exploration and production oil wells that reach out farther than any that have been ever drilled.
It just so happens that BP, which owns oil leases near the ANWR boundary, is a pioneer in drilling such wells. For example, its Liberty exploration project in the Beaufort Sea, scheduled to begin next year, involves the longest directional drilling in the world: tapping oil six to eight miles north of the drill site.
If Congress allowed access to ANWR, "we'd look at the opportunity," said BP spokesman Steve Rinehart.
Murkowski called her legislation a compromise effort. ANWR has long been a battleground between those who want to develop a place considered one of the nation's best prospects for major oil discoveries and those who want to preserve this swath of America in the northeast corner of Alaska.
The drilling would take place from state land and waters rimming the refuge, she told applauding lawmakers. But "there would be no surface occupancy of lands in the refuge proper," she told the Alaska Legislature in her annual address.
"The nation gets its oil. Those who are concerned about the loss of wilderness get to enjoy the refuge as it exists today," Murkowski, R-Alaska, said. "Impacts to subsistence are minimized, if not eliminated."
State regulators said that the feds would have to allow lease sales in ANWR for the idea to work. State permits also would be required, they said.
Environmentalists said they would oppose any activity on or near the coastal plain and they point to recent North Slope oil spills as reason to prevent new activity in sensitive areas.
Kristen Miller, government affairs director for the Alaska Wilderness League, called the proposed legislation: "Big Oil's latest scheme to get their hands on pristine, untouched land that millions of Americans have fought for years to protect."
"No matter how you dress it up, the goal is still to develop one of the few truly wild places we have left," she said.
Advocates of advanced directional drilling methods say it would allow for a much smaller footprint affecting wildlife.
But Anchorage attorney Peter Van Tuyn, who represents various environmental groups in Alaska, said an intensive exploration program would have to take place on the coastal plain before any production wells could be drilled.
"I haven't seen any technology that would allow them to do it and still meet what (Murkowski) said she wanted to do, which is to leave the coastal plain totally alone," Van Tuyn said.
Robert Dillon, Murkowski's energy aide, said the disruption would be negligible.
He said the seismic exploration needed to explore the reserves would occur over one or two winters, depending on the length of the season. He said that means work could proceed without disrupting caribou that calve there in summer. Not disturbing the caribou is a primary concern of the Gwich'in Indians who depend on the herd for food. It also would avoid the need to build roads because travel could take place using vehicles with big rubber tires to protect the land.
"In the summer there would be no trace that we were ever there and we wouldn't have to go back," Dillon said.
An oil company also would need to drill exploration wells. While that could be done from state land or water, it could be quite expensive and difficult, state regulators said.
"Normally you wouldn't do a well like this for (exploration)," said Kevin Banks, director of the state Oil and Gas Division.
Maybe with very promising seismic results, an oil company would consider it, he said.
Given the decades of deadlock over ANWR, offshore oil development plus drilling in the National Petroleum Reserve-Alaska to the west seems to be more promising in the immediate future, he said.
"There's more oil potential there than there is in ANWR," he said.
Murkowski said she realizes directional drilling is not a perfect solution, and current technology means it would only reach about a tenth of likely oil reserves, perhaps a greater percentage of the natural gas.
But she said drilling technology is advancing all the time, and more reserves will open for development.
An updated geological assessment of ANWR a decade ago showed that the greatest potential for oil occurred in the northwestern part of the coastal plan, closest to the existing oil fields.
But President Obama has opposed to drilling in ANWR and Van Tuyn predicts that won't change. "Any effort to drill the refuge in any sense is dead in the water with this administration and should be," he said.
The coastal strip of ANWR, as the refuge is commonly referred to, is believed to contain 10.5 billion barrels of oil. At peak production the refuge could supply 1 million barrels a day by 2025, according to the Interior Department.

By:  Anne Sutton
Source: ANWR: Oil companies would set up shop on periphery, drill at slant.