ConocoPhillips has filed a lawsuit challenging a ban imposed by the Biden Administration on drilling across almost half of Alaska’s National Petroleum Reserve (NPR-A).
The American crude oil and natural gas company argues that the ban violates federal law mandating oil development in the area.
Its lawsuit targets a rule of US Department of the Interior that prohibits oil leasing on 10.6 million acres of the 23-million-acre reserve and imposes restrictions on future oil activities in 13 million acres defined as “special areas.”
This legal action represents a significant test of US President Joe Biden’s efforts to curtail oil development on federal lands, reported Bloomberg, as climate activists argue that such measures are incompatible with addressing climate change.
The new regulation applies to existing leases within the reserve but does not alter the terms of current contracts or directly impact ongoing activities. These include ConocoPhillips’ Willow project, which is estimated to contain 600 million barrels of oil.
However, the rule could have broad implications for companies holding leases within the reserve, wrote the publication.
The Alaska unit of ConocoPhillips holds 1.8 million acres of state and federal leases, including one million acres yet to be developed as of the end of 2023, according to the company’s court filing.
ConocoPhillips argues in its lawsuit, filed in an Alaska federal court, that Congress intended the reserve for the “expeditious production of oil to meet the nation’s energy needs.”
The reserve is estimated to hold about 8.7 billion barrels of recoverable oil, as per a 2017 US Geological Survey assessment.
ConocoPhillips stated: “Congress plainly did not authorise the Bureau of Land Management (BLM) to enact sweeping regulations that obstruct and prevent petroleum production across the NPR-A.”
The company contends that the rule introduces various new provisions prioritising resource preservation over production of energy, and effectively transforming the petroleum reserve into a de facto wilderness area where development is effectively prohibited.
ConocoPhillips took a final investment decision (FID) on the Willow project in December 2023. Located on the plain of the North Slope of Alaska, the oil drilling project involves the construction and operation of up to five drill pads for a total of 250 oil wells, along with associated infrastructure.
