Oil companies exit leases in Alaska’s ANWR

Oil companies exit leases in Alaska’s ANWR

Washington, 2 June (Argus) — The only oil companies holding leases in the Arctic National Wildlife Refuge (ANWR) have given up their development rights, amid stiff obstacles to beginning drilling in the area.

Australian independent 88 Energy subsidiary Regenerate Alaska canceled and received a full refund for the $771,000 it paid last year for a 23,400-acre federal oil lease in ANWR, the US Interior Department said on 1 June. The company's withdrawal from the area represents a blow to state officials that for years pushed to allow drilling in ANWR, which is projected to hold 5.7bn-10.4bn bls of recoverable oil.

Chevron and US independent Hilcorp last year separately paid a "breakage fee" of $10mn to cancel legacy leases they held on tribal land within the boundaries of ANWR, the Alaska Native-owned Arctic Slope Regional Corporation said in its latest annual report. Chevron said it was designated as lease operator in 1984 for about 90,000 acres in ANWR, and its relinquishment of that legacy lease was finalized earlier this year.

"Chevron's decision to formally relinquish its legacy lease position was driven by the goal of prioritizing and focusing our exploration capital in a disciplined manner in the context of our entire portfolio of opportunities,"