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Trump administration approves first oil production project in federal Arctic waters

26 October 2018

On October 24, the Trump administration approved a plan by Houston-based Hilcorp to start large-scale oil production in federal waters off Alaska’s North Slope. The company’s Liberty Project involves the construction of a nine-acre gravel island in shallow waters about five miles from shore and drill for oil from there. A pipeline buried beneath the ocean floor would carry the oil to shore.

A 3-D rendering of Hilcorp’s proposed Liberty Project island - Image: BOEM
A 3-D rendering of Hilcorp’s proposed Liberty Project island - Image: BOEM

The proposed development is five miles off the coast in the Beaufort Sea, 20 miles east of Prudhoe Bay. Hilcorp says that although this will be the first development in federal waters, four other island-based projects are already operational in the Beaufort Sea in state waters: Spy Island, Northstar Island, Endicott Island and Oooguruk Island.

The approval was announced after the Interior Department’s Bureau of Ocean Energy Management (BOEM) evaluated the Liberty Project to evaluate safety and environmental impacts.

“We consider Hilcorp’s plan to represent a relatively conservative, time-tested approach toward offshore oil and gas development,” Joe Balash, the Interior Department’s assistant secretary for land and minerals management, said in a statement. “Using input from North Slope communities, tribal organizations and the public, we have developed a robust set of environmental mitigation measures and safety practices that will be applied to this project.”

According to Hilcorp, the Liberty Project will produce about 60,000 barrels of oil per day and will operate for 15 to 20 years. The project is planned to start up in the early 2020s.

Before the project gets the final go- ahead, Hilcorp will need approvals, from agencies such as the US Environmental Protection Agency and the Army Corps of Engineers.

Environmental groups have criticised the decision because of Hilcorp’s past record of hydrocarbon releases in Alaska.

In the last major incident in early 2017, the company took four months to fix a natural gas leak from its underwater pipeline in Alaska's Cook Inlet, with an estimated 200,000 cubic feet of methane a day leaking from the pipe.

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