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Groups appeal Arctic offshore lease sale decision

An appeals court will decide whether federal regulators conducted adequate environmental studies before selling $2.7 billion in petroleum leases off Alaska's northwest coast.

Alaska Native and environmental groups on Thursday challenged a U.S. District Court decision that concluded the Bureau of Ocean Energy Management had adequately considered the environmental effects of a 2008 sale in the Chukchi Sea, home to one of two populations of polar bears in the United States, plus walrus, ice seals and endangered whales.

"This Bush-era lease sale in one of the most fragile and least understood ecosystems in the world was never a good idea," said Rebecca Noblin, Alaska director for the Center for Biological Diversity, in the announcement of the appeal.

"Four years later, all we've learned about the Chukchi Sea is how little we know," she said. "It's time the Obama administration took the blinders off and admitted that neither it nor the industry is prepared for the risks of drilling for oil in the Arctic Ocean."

Bureau of Ocean Energy Management spokeswoman Theresa Eisenman said from Washington, D.C., that the agency does not comment on pending litigation.

A subsidiary of Royal Dutch Shell was the leading bidder in the 2008 lease sale, spending $2.1 billion. The company hopes to drill its first exploratory wells on the Chukchi leases this summer, along with leases it obtained in a previous sale in the Beaufort Sea.

The 15 groups filed the original lawsuit in 2008 and received a favorable ruling in 2010 by U.S. District Court Judge Ralph Beistline of Anchorage.

The judge ordered the management bureau to analyze the environmental effect of natural gas development in the Chukchi lease area. Beistline also said regulators failed to determine whether information they acknowledged was missing before the sale was relevant or essential, or whether the cost of obtaining that information was exorbitant.

The Bureau of Ocean Energy Management was created to replace the Minerals Management Service. Beistline ruled in February that the bureau had addressed the court's concerns with supplemental work and had sufficiently studied and evaluated future impacts of resource development in the region.

Earthjustice attorney Erik Grafe said Thursday the groups he represents disagree. The bureau, an agency under the Department of the Interior, acknowledged it still lacks important habitat information, he said.

"Basically BOEM said there's hundreds of instances where we just don't know, we don't have information about the Chukchi Sea," Grafe said. "We don't know what areas are important for bowhead whales. We don't know what areas are important for beluga whales. We don't understand the different habitat areas and the importance of those areas for species.

"And then it concluded, basically based on boilerplate language, that none of this information is essential to the decision."

Grafe said the appeals court will set a briefing schedule. He acknowledged a decision on the appeal likely will come after planned drilling.

A separate lawsuit by some of the same groups is challenging approval of Shell's exploration plan.

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