ConocoPhillips has initiated a lawsuit to challenge the Biden administration’s prohibition on drilling in nearly half of the National Petroleum Reserve in Alaska.
The company argues that this restriction breaches a federal law mandating oil development in the region.
Legal Challenge Against Interior Department Rule
Filed on Friday, the lawsuit targets a rule from the Interior Department that explicitly forbids oil leasing on 10.6 million acres (4.3 million hectares) of the 23-million-acre reserve. Additionally, it limits future oil development in 13 million acres labeled as “special areas.”
This lawsuit will test a significant move by President Joe Biden to curtail oil development on federal lands, in response to demands from climate activists who argue that such activities are detrimental to a warming planet.
Industry Concerns Over Development Restrictions
Advocates for the oil industry, holding leases within the reserve, argue that the Bureau of Land Management’s regulation unlawfully hampers development in an area initially designated a century ago as an energy resource for the Navy.
The regulation will affect existing leases within the designated area but will not change the terms of current contracts or directly impact authorized activities, including ConocoPhillips’ Willow project, estimated to hold 600 million barrels of oil.
ConocoPhillips’ Stakes in Alaska
Despite these regulations, the rule could significantly impact companies with leases in the reserve. ConocoPhillips’ Alaska division holds 1.8 million acres of state and federal leases in Alaska, with 1 million net undeveloped acres reported at the end of 2023.
In its lawsuit, ConocoPhillips argues that Congress intended the reserve for “expeditious production of oil to meet the nation’s energy needs,” noting that the area contains an estimated 8.7 billion barrels of recoverable oil, as per a 2017 US Geological Survey assessment.
Broader Legal Context
The company contends that Congress “did not authorize BLM to create extensive regulations that hinder oil production throughout the NPR-A.”
However, the rule includes “numerous new provisions that prioritize resource preservation over energy production, effectively turning the petroleum reserve into a de facto wilderness area where development is completely prohibited.”
Related Legal Actions
This case adds to earlier challenges filed by the Voice of the Arctic Iñupiat, representing communities in North Alaska, the state of Alaska, and oil companies North Slope Exploration LLC and North Slope Energy LLC, which collectively hold leases covering over 552,000 acres in the reserve.
The lawsuit is filed under ConocoPhillips v. Department of Interior, 24-cv-00142, in the US District Court for the District of Alaska.