Curation ESG
March 25, 2023
Dillon Creedon
What’s happening? ConocoPhillips, the oil and gas exploration company, has received approval from the Biden administration for its controversial $8 billion drilling project in Alaska. The project, which is located on the North Slope of Alaska and is expected to produce 576 million barrels of oil over the course of 30 years, has faced criticism from environmentalists and some indigenous communities who claim that it will have negative impacts on food security and exacerbate climate change. Two lawsuits have been filed in an attempt to halt the project in the wake of the approval.
The project – The Willow project will involve the construction of three oil pads, 25 miles of gravel roads, an airstrip, and several hundred miles of ice roads. This represents a 40% reduction in infrastructure from ConocoPhillips’ original proposal, which included five oil pads, seven bridges, and an extensive pipeline network. Additionally, to push the deal over the line, the company has relinquished its rights to 68,000 acres of land within the reserve, having held leases since the 1990s.
Economic gains – The economic benefits of the project are expected to be significant. According to ConocoPhillips, it will create 2,500 construction jobs and 300 long-term jobs and is projected to generate between $8-17 billion in revenue for the federal government, the State of Alaska, the North Slope Borough, and local communities.
Biden’s U-turn – The approval of the project is seen by many as a U-turn for President Biden, who campaigned on a platform that included a critique of Alaskan oil drilling, even going as far as saying “no more drilling on federal lands, period”. Last year, he revoked plans approved by the Trump administration to allow drilling in the Arctic National Wildlife Refuge, which would have produced 11 billion barrels of oil. The Willow project is due to become operational in 2029, just one year before Biden’s deadline to halve greenhouse gas emissions.
Lawsuits – Following the approval of the Willow project, two separate lawsuits have been filed in response. The first was filed on March 14th by Earthjustice on behalf of six environmental groups, accusing the government of disregarding its climate guidelines outlined in the National Environmental Policy Act by authorising a “carbon bomb.” The lawsuit highlights the anticipated 260 million tons of greenhouse gases that will be released as a result of ConocoPhillips’ customers burning the fuel, equivalent to the impact of opening 70 new coal-fired power plants. In addition, the case addresses concerns from community leaders who believe that the drilling will have a negative impact on the migration patterns of the local Caribou population, which is critical for their food security.
The second lawsuit was filed on March 16th by several environmental groups, including The Natural Resources Defence Council, the Centre for Biological Diversity, and Greenpeace. The lawsuit claims that the issues with the project that were identified by a judge in 2021 have not been adequately addressed. Furthermore, the group raised concerns about the potential threat of an oil spill and the disruption that could arise from construction in a highly ecologically sensitive area. Alaska is home to various endangered species, such as polar bears and seals, and is highly susceptible to climate change, warming at a rate four times faster than the global average over the past four decades.
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