ConocoPhillips requests July decision on Willow suit

  • ConocoPhillips is asking for a ruling on lawsuits targeting its Willow project by July 1.(Photo/Judy Patrick/ConocoPhillips)

ConocoPhillips is asking the federal judge overseeing both of the lawsuits seeking to stop one of the largest North Slope oil developments in decades to determine the near-term fate of the project by the summer.

Attorneys for the Houston-based major that has grown its presence on the Slope in recent years proposed to U.S. District Court of Alaska Judge Sharon Gleason that she rule by July 1 on the merits of the nearly identical lawsuits challenging the federal permits for its Willow oil project. A midsummer decision would hopefully allow ConocoPhillips and Interior agencies time to remedy any issues ahead of the 2021-22 winter construction season, they wrote in motions filed Feb. 22.

Separately, the Bureau of Land Management and the coalition of national conservation groups suing the agency over its approval of ConocoPhillips’ development plan for Willow jointly submitted a motion Feb. 22 in one of the suits laying out an agreed-upon schedule that would have the last briefs filed by June 1, ahead of a ruling by Gleason.

The Sovereign Inupiat for a Living Arctic and conservation groups that filed the other suit against BLM had not filed a proposed schedule as of Feb. 23.

ConocoPhillips was prohibited from starting work Feb. 6 on access roads to the $6 billion oil project the company expects to eventually produce upwards of 100,000 barrels per day after Gleason issued temporary injunctions in the suits until the 9th Circuit Court of Appeals could rule on an appeal of her Feb. 1 decision that initially rejected injunction requests.

The company had planned to open a gravel mine and construct up to 2.8 miles of gravel road extending west from its smaller Greater Mooses Tooth-2 oil project, which is also under construction and is expected to start producing oil late this year. Significant work was set to start in mid-February before the order halted it.

In explaining the temporary backpedal, Gleason wrote that there is likely to be irreparable environmental consequences once ConocoPhillips begins blasting for a gravel pit to supply its road construction and the 9th Circuit Court could have a different interpretation of statutes she believes time-bar the permit challenges.

She had previously concluded that the early gravel work in the National Petroleum Reserve-Alaska was not likely to “irreparably injure” the population of south Beaufort Sea polar bears that are protected under the Endangered Species Act before she could rule on the broader merits of the lawsuits as the conservation and Alaska Native groups argued.

A panel of 9th Circuit judges subsequently granted the injunction in an order filed Feb. 13 on the grounds that they could have a different view of the applicability of a 1980 statute that limits challenges of at least some NPR-A environmental impact statement reviews to within 60 days after a notice of the EIS is published.

At the heart of the matter is whether the law applies to all EIS reviews relating to the NPR-A or just broader reviews for things such as oil and gas leasing programs.

Then-Interior Secretary David Bernhardt signed the record of decision approving the Willow plan with some modifications to the company’s original plan Oct. 26, 2020. Bernhardt and BLM Alaska Director Chad Padgett also signed the record of decisions for a new land management plant meant to open more of the NPR-A to oil and gas leasing this past December.

The lawsuits arguing BLM officials under the Trump administration failed to conduct a sufficiently rigorous review of the oil project’s environmental impacts were filed Nov. 16 and Dec. 21; the final EIS reviews for Willow and NPR-A land-use plans were published in Aug. 13 and June 25, respectively.

ConocoPhillips attorneys wrote in their schedule motions that preparing for next winter’s construction season “requires ramping up to as many as 300 employees in the second half of 2021 to work on engineering and logistics, as well as entering into numerous contracts for the construction, fabrication and transportation of pipes, culverts, bridges and other equipment to the North Slope for use next winter.”

ConocoPhillips Alaska spokeswoman Rebecca Boys wrote via email that the company is reviewing its options to determine if the delay this winter will impact the overall development timeline for Willow. The company previously hoped to start producing oil from the large project in 2026.

Boys wrote that she could not put a dollar figure on the expenses the company is incurring due to the injunction but did note that it has impacted approximately 120 jobs this winter.

The members of Alaska’s congressional delegation said in a joint statement that they are “deeply troubled” by the 9th Circuit ruling that stalled work on one of the few current bright spots in the state’s economy.

In December, the 9th Circuit invalidated the EIS for Hilcorp Energy’s Liberty oil project offshore from the North Slope because Bureau of Ocean Energy Management officials failed to estimate the greenhouse gas emissions from the project’s oil that would likely be sold overseas.

Sen. Dan Sullivan has long championed splitting the San Francisco-based Ninth Circuit into two courts on the hopes a new court for Alaska and other resource-dependant states could be more favorable to resource extraction projects.

CP drilling

Elsewhere on the Slope, ConocoPhillips currently has one drill rig actively working at its highly productive CD5 drill pad. The company suspended all drilling on the Slope for most of 2020 while oil prices remained low as a result of the pandemic.

However, oil prices have rebounded quicker than many analysts expected and are back to pre-pandemic levels of more than $60 per barrel.

Doyon Drilling Rig 25, which is currently at CD5, will move to GMT-2 in the second quarter in preparation for first oil from the mid-sized NPR-A project later this year, according to Boys. Doyon 26, dubbed “The Beast” for its extended reach drilling capabilities, will also start drilling in the Alpine field in the second quarter, Boys wrote.

ConocoPhillips Alaska leaders previously said they plan to have four rigs working on the Slope by the end of the year.

Elwood Brehmer can be reached at [email protected].

02/24/2021 - 9:37am