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New US offshore oil leasing plan includes Arctic
by Staff Writers
Washington (AFP) Nov 8, 2011

The Obama administration on Tuesday proposed a new plan for offshore oil and gas leases in the Gulf of Mexico and off the coast of Alaska, including the environmentally sensitive Arctic.

The proposed program for 2012-2017 sets out 12 lease sales for areas owned by the federal government in the Gulf of Mexico and three in Alaska, including the Beaufort Sea and Chukchi Sea areas off the northern Alaskan coast, and Cook Inlet.

But it did not open up for exploration the politically sensitive Atlantic or Pacific coastlines, or the eastern Gulf of Mexico along the Florida coast.

Interior Secretary Ken Salazar said the program was in line with President Barack Obama's direction "to continue to expand safe and responsible domestic production."

Salazar acknowledged the sensitivity of expanding exploration in the Arctic, "where we must proceed cautiously, safely and based on the best science available."

The proposal includes the first lease sales in the Beaufort and Chukchi seas since 2008, before Obama became president.

Since then, and especially after the April 2010 BP-Deepwater Horizon blowout and oil spill in the Gulf of Mexico, the administration has been cautious about proceeding with new offshore exploration and development.

The Interior Department said the new Arctic sales were scheduled only late in the five-year period to allow for further scientific study and data collection, and longer term planning for spill response preparedness and infrastructure.

"In Alaska and off its coast, the proposed program recommends that the current inventory of already-leased areas in the Arctic should be expanded only after additional evaluations have been completed, and in a manner that accounts for the Arctic's unique environmental resources and the social, cultural, and subsistence needs of Native Alaskan communities," said David Hayes, Interior's deputy secretary.

The department will accept public comment on the proposal until January 9, and submit the final plan to Congress and the White House.

Environmental group the Sierra Club was quick to blast the plan, saying Arctic drilling could "jeopardize one of our nation's last wild frontiers."

"The risk to the fragile Arctic area and Alaska communities is clear," said Athan Manuel, Sierra Club director of lands protection.

"Spill prevention, containment and response systems are not equipped to work in challenging Arctic conditions -- in short, when there is a spill in the Arctic, we will not be able to clean it up."

Marilyn Heiman, US Arctic Program director at the Pew Environment Group, said "the Arctic is extremely fragile and remote... this is a very perilous and dangerous proposal."

"We are not opposed to drilling in the Arctic Ocean," she told AFP, but there "should be key limits" so that it does not negatively impact marine animals, fish and communities.

"There needs to be a very surgical approach" in deciding where drilling can be done. "There's no proven technique to cleaning up oil in ice," she added.

The plan marked a step back from Obama's previous plan, released in March 2010 weeks before the BP spill in the Gulf of Mexico, the worst environmental disaster in the nation's history.

Under that plan, new tracts of the Atlantic off the Virginia coast would have been opened to exploration, and leases would have been expanded in the Gulf of Mexico off the coast of Florida.

But the administration reversed itself later in the year, banning drilling in some areas until 2017 in the wake of the BP disaster.

Republicans and oil companies have been pushing to open up more offshore drilling.

The American Petroleum Institute, representing more than 480 oil and natural gas companies, called the administration's new proposal a "good first step" but not enough to address the nation's needs.

"This is a missed opportunity to open additional areas that could have helped address rising energy demand, create American jobs and reduce the federal deficit," said Erik Milito, an API director.

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US agency expects vindication in pipeline probe
Washington (AFP) Nov 8, 2011 - The US State Department said Tuesday it is confident it will be vindicated in a probe into how it is handling a pending decision on whether to grant a permit for a massive US-Canada oil pipeline.

The agency's Office of Inspector General (OIG) revealed it is launching a "special review" of the department's handling of the Environmental Impact Statement (EIS) and National Interest Determination for the mammoth project.

A letter from US lawmakers, released by the Natural Resources Defense Council, had asked the OIG if TransCanada, the pipeline developer, improperly influenced the State Department's selection of a contractor for the EIS.

"We welcome this review," State Department spokeswoman Victoria Nuland told reporters, calling it "an opportunity for an impartial assessment" of how it has handled public consultations into whether or not to allow the pipeline.

"And we are confident that this assessment will bear out that we have conducted the Keystone pipeline review process consistently with existing US law and regulations," she said.

"And we will be cooperating fully with the Office of Inspector General," said Nuland.

The State Department has been holding public consultations on plans to build the 1,700-mile (2,700-kilometer) Keystone XL pipeline from the tar sands of Canada's Alberta province to the Gulf of Mexico in the southern United States.

In its long-awaited environmental impact statement on the project, the State Department said in August that the pipeline would be safer than most current oil transportation systems.

Many environmentalists fear a potential pipeline accident would spell disaster for aquifers in central US Great Plains states. That could disproportionately endanger rural towns and Native Americans, they say.

Friends of the Earth last month alleged that emails it obtained through the Freedom of Information Act showed that department employees held a "pro-pipeline bias and complicit relationships with industry executives."

The State Department denied the charges, saying it had behaved "transparently and evenhandedly" toward the pipeline project.

The State Department said last week it still aimed to issue a decision by year-end but cautioned the deadline could slip as the "first priority" is to ensure the pipeline's potential environmental impact is carefully studied.

Washington is considering the permit for the $7 billion project, due to stretch across 1,700 miles (2,700 kilometers), part of the broader $13 billion Keystone pipeline system.


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OPEC raises forecasts, warns of investment uncertainty
Vienna (AFP) Nov 8, 2011
OPEC raised its medium- and long-term forecasts for oil output on Tuesday but warned that uncertainty over energy and environmental policy was confusing the picture and could affect investment. By 2015, global oil demand was expected to reach 92.9 million barrels per day (mbdp), up from the 91 mbpd given in last year's World Oil Outlook report. In the longer-term, the Organisation of P ... read more

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