Trump Alaska lease sale draws record $163 mln from oil majors
By Nichola Groom
March 18 (Reuters) - The U.S. government on Wednesday held its most successful sale ever of oil and gas drilling rights in Alaska's National Petroleum Reserve, attracting $163 million in winning bids from industry players including Repsol REP.MC, Shell SHEL.L, ConocoPhillips COP.N and ExxonMobil XOM.N.
The record auction revealed pent-up demand among drillers for acreage in the reserve, more than six years after the last federal oil and gas auction there. Though it has significant development potential, interest in the region has waned in recent years due to the high cost of drilling in the remote area and risks from environmental litigation.
The sale was the first of at least five mandated by President Donald Trump's tax cut and spending bill, which he signed into law last year. His administration has sought to expand domestic oil and gas production and reverse Biden-era restrictions on drilling in the Alaska reserve.
"The results of today's sale are historic," Bureau of Land Management Alaska State Director Kevin Pendergast said after announcing the preliminary results of the livestreamed auction. "It makes clear that for the NPR-A, despite all the successes to date, the best days are still ahead."
The Interior Department's Bureau of Land Management received 430 bids on 187 of the 625 tracts offered, according to a sale summary published on its website.
The industry bid on 1.3 million acres of the 5.5 million acres (2.2 million hectares) offered.
A Repsol and Shell joint venture was the top spender at the auction, bidding a total of nearly $94 million for 42 tracts.
"This reinforces Repsol’s long-term commitment to energy development in the United States and Alaska, further strengthening its position and future upside in the state," a spokesperson said via email. This is Repsol's first time partnering with Shell in Alaska.
Other notable winners included ConocoPhillips, ExxonMobil and North Slope Exploration LLC.
"We appreciate the Trump Administration’s efforts to advance America’s energy potential by recognizing the strategic importance of responsible resource development in Alaska," a ConocoPhillips spokesperson said by email. The company's winning bids totaled more than $21 million for 30 tracts.
ExxonMobil said it was pleased to be the winner of 138,000 acres at the sale.
"This marks an important step in our continued commitment to responsible energy development in Alaska and the U.S.," a spokesperson said in an email.
The highest single bid was $3.65 million by Epoch Oil & Gas LLC for a 12,800-acre tract.
Epoch and North Slope Exploration could not immediately be reached for comment.
The NPR-A, as the 23-million-acre reserve is known, was designated for oil and gas exploration in the 1970s to address energy shortages. It is estimated to hold 8.7 billion barrels of recoverable oil and 25 trillion cubic feet (708 billion cubic meters) of recoverable natural gas.
The last NPR-A lease sale in 2019 attracted $11.3 million in bids on 1.05 million acres.
Alaska state officials and some native groups support oil and gas drilling because it contributes to tax revenue and creates jobs. Environmentalists argue oil and gas development destroys habitats for species such as polar bears and caribou.
