Resource Review Winter 2025

Alaska Resource Review is the official magazine of the RDC, published three times a year to inform Alaskans and others about the importance of Alaska’s resource industries as well as advocate for issues critical to the success of those industries. Resource Review reaches more than 20,000 readers important to these industries, in print, at RDC events and online via digital, social and email media.

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ALASKA RESOURCE REVIEW

FULL STEAM AHEAD 2025 Provides Optimism for Our Industries

Trump: Alaska Vital to Future of U.S. Economy

INSIDE THIS ISSUE n RDC Turns 50! Help Us Celebrate Our Next 50 Years n Alaska Offers Everything Greenland Does — And More n Alaska Resources Conference One for the Record Books n North Slope Projects to Pump Up Alaska Oil Industry

Magazine of the Resource Development Council for Alaska | www.AKRDC.org

ConocoPhillips Alaska and the successes of its heritage companies date back to the greatest oil discoveries in Alaska history. Today we continue our tradition of developing, innovating and delivering value for Alaskans. Committed to Alaska for more than 50 years.

Western North Slope, Alaska

Richfield Oil Co. drills the first well in the Swanson River field and strikes oil.

Alaska becomes the 49th state.

ARCO discovers oil in the Prudhoe Bay field.

Sinclair Oil Co. discovers the Kuparuk River field.

Alpine field production begins from wells drilled with horizontal well technology.

Final Investment Decision is made to develop the Willow project.

Learn more

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"We have much work to do and we have many great partners to work with. We will continue to do what RDC has always done: by doing it together because together, we are stronger!" — Leila Kimbrell, Executive Director, RDC

RDC TURNS 50: THANK YOU FOR UNWAVERING SUPPORT!

D EAR RDC MEMBERS & SUPPORTERS, It’s an exciting time as we welcome in 2025! By the time you read this, we will be several weeks into the new year and with that comes many new opportunities. With a new state legislature starting in Juneau, we welcome our newly elected state officials and soon be in Juneau for our annual legislative fly-in. Staff and many of our board mem- bers will be in attendance to meet leg- islators and cabinet officials in person to discuss resource policy issues that matter most to you. There will be signif- icant focus on the state budget and we will be watching closely to ensure our resource industries are treated fairly. Our 2025 state policy priorities were recently released and you can now find them on our website. On the national level, there is much excitement as a new administration takes office. Already, the administra- tion is poised to refocus on responsi- ble resource development issues and “Unleashing Alaska’s Extraordinary Resource Potential.” (If you missed it, please look up this extraordinary Exec- utive Order issued Jan. 20, 2025). This is welcome news for projects like the Am- bler Access Road, the Arctic National Wildlife Refuge (ANWR), development in the National Petroleum Reserve in Alaska (NPR-A), reopening access for timber harvest and more in the Tongass National Forest, and honoring leases in the Chugach National Forest, to name

connection or other piece of history to share? We’d love to hear from you! Please email resources@akrdc.org with the subject “RDC50.” In this issue, you’ll see many great articles and updates and I want to thank all who contributed to our magazine – including our very own U.S. Senator Dan Sullivan, R-Alaska. There are also photos and recaps from our 45th annu- al Alaska Resources Conference. Thank you again to all our sponsors, speakers and attendees who made this one of our most successful conferences ever! This year, we plan to increase the Resource Review to a quarterly publication and would not be able to do that without your support. With so much invigorating news and events to look forward to in 2025, it’s hard to capture the sheer energy here at RDC and put it more eloquently into words. (“Git R Done” comes to mind!). We have much work to do and we have many great partners to work with but it won’t happen overnight. However, we will continue to do what RDC has al- ways done: by doing it together because together, we are stronger! I look forward to seeing you all again in this new year! As always, I want to hear your feedback and ideas for what you want to read about. Yours resourcefully,

a few. RDC looks forward to working with our federal partners, including Alaska’s new Congressman, Nick Be- gich. With so much to look forward to, we will also be reflecting on our past. This year, RDC turns 50! What an amazing milestone! This is a testament to readers like you who support our mission of “Growing Alaska Through Responsible Resource Development” and represent the best of our oil, gas, mining, timber, tourism and fishing industries. RDC originally formed in 1975 as the Organization for the Management of Alaska’s Resources (OMAR) in response to the development of oil on Alaska’s North Slope and the con- struction of the Trans Alaska Pipeline System. Soon after, OMAR changed its name to the Resource Development Council for Alaska and the rest, as they say, is history. Stay tuned throughout the year as we plan additional events to honor the past 50 years and look to the next 50 years! One ask of you: We are compiling stories, photos and more to celebrate RDC at 50. Do you have a story, photos, WE ARE COMPILING STORIES, PHOTOS AND MORE TO CELEBRATE RDC AT 50. DO YOU HAVE A STORY, PHOTOS, CON- NECTION OR OTHER PIECE OF HISTORY TO SHARE? WE’D LOVE TO HEAR FROM YOU! PLEASE EMAIL RESOURCES@AKRDC.ORG WITH THE SUBJECT “RDC50.”

www.AKRDC.org

INDEX

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PAGE 8 INNOVATION, OPPORTUNITY ABOUND FOR WORKFORCE Innovation is happening right here at home if young Alaskans take the time to look for it, writes Connor Hajdukovich, RDC External Affairs and Policy Coordinator. PAGE 12 DESPITE SACKETT RULING, STATE FACES FEDERAL ISSUES Alaskans hoped the ruling on federal regulation of wetlands would clarify this complex issue, and in Alaska’s favor. But things are still muddled, say sources familiar with the issue. PAGES 24-27 45TH ALASKA RESOURCES CONFERENCE: THANK YOU! We extend our heartfelt gratitude to all attendees, sponsors and exhibitors who made the Alaska Resources Conference a tremendous success! PAGE 34 ALASKA SEAFOOD LOOKS TO FUTURE OF VITAL INDUSTRY While the situation facing Alaska's seafood industry has provided obstacles at multiple levels, there are pockets of optimism.

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ALASKA RESOURCE REVIEW is published in partnership with the Resource Development Council for Alaska, Inc. by Fireweed Strategies LLC, 4849 Potter Crest Circle, Anchorage, AK 99516. For advertising information and story inquiries, email Lee.Leschper@FireweedStrategies.com. ALASKA RESOURCE REVIEW is mailed at no charge throughout Alaska. To subscribe, email Admin@FireweedStrategies.com. Publisher: Lee Leschper | Editor: Tim Bradner | Production, Design: Will Leschper | Contributing Photographer: Judy Patrick PLEASE NOTE: RDC HAS MOVED OFFICES! Please update your records with our new physical and mailing address: 301 W. Northern Lights Blvd., Ste. 406, Anchorage, AK 99503

ALASKA RESOURCE REVIEW WINTER 2025

At Santos, we are proud to develop the world-class Pikka Project on the North Slope. Phase 1 will develop about 400 million barrels from a single drill site with first oil expected in 2026. And we are even prouder that our interest in Pikka will be net-zero on Scope 1 & 2 emissions!

www.AKRDC.org

MINING

OIL & GAS

F I SHER I ES

TOUR I SM

FORESTRY

Welcome to the Alaska Resource Review! This magazine in both print and online editions is the official publication of the Resource Development Council for Alaska. This publication is our newest tool to help the RDC in advocating for all five of Alaska’s key resource industries — oil and gas, mining, fisheries, forestry and tourism. When the first issue of Resource Review was published in 1978, our organization was named the Organization for Management of Alaska’s Resources Inc. (OMAR), and we were focused on building and maintaining the Trans Alaska Pipeline. We became the RDC three years later and our mission grew to represent all our resource industries. Welcome to the Alaska Resource Review! This magazine in both print and online editions is the official publica- tion of the Resource Development Council for Alaska. This publication is our newest tool to help the RDC in ad- vocating for all five of Alaska’s key resource industries — oil and gas, mining, fisheries, forestry and tourism. When the first issue of Resource Review was published in 1978, our organization was named the Organization for Management of Alaska’s Resources Inc. (OMAR), and we were focused on building and maintaining the Trans Alaska Pipeline. We became the RDC three years later and our mission grew to represent all our resource in- dustries. On the following pages you will see stories about all of the vital industries we represent in Alaska and abroad. It’s both amazing and humbling how much the faces have changed, but the stories and the challenges remain the same! In future issues of Alaska Resource Review, we will keep you abreast of key issues we need to address, what’s happening inside the RDC and with our members, as well as putting a very human, Alaskan face on the people who get it done right in Alaska! In future issues of Alaska Resource Review, we will keep you abreast of key issues we need to address, what’s happening inside the RDC and with our members, as well as putting a very human, Alaskan face on the peo- ple who get it done right in Alaska! Our readership is now worldwide. Our goal is reaching key leaders with correct, current, compelling information on the importance of developing Alaska’s resources for the good of both our state and our country. We hope you enjoy our work here and support what we do. We encourage you to join this effort with suggestions, stories, or story ideas, and to share this publication both with others in your team and especially those beyond our borders and industries who need to hear these stories. We hope you enjoy our work here and support what we do. We encourage you to join this effort with sugges- tions, stories, or story ideas, and to share this publica- tion both with others in your team and especially those beyond our borders and industries who need to hear these stories. Enjoy! Our readership is now worldwide. Our goal is reaching key leaders with correct, current, compelling informa- tion on the importance of developing Alaska’s resources for the good of both our state and our country. On the following pages you will see stories about all of the vital industries we represent in Alaska and abroad. It’s both amazing and humbling how much the faces have changed, but the stories and the challenges re- main the same!

For advertising information, rates and deadlines, email or call: Fireweed Strategies LLC Lee.Leschper@FireweedStrategies.com 907-957-6025

Enjoy!

ALASKA RESOURCE REVIEW is published by Fireweed Strategies LLC, the publisher of unique Alaska magazines.

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The Resource Development Council of Alaska (RDC) is a statewide business association comprised of individuals and companies from Alaska’s fishing, timber/forest products, mining, oil and gas, and tourism industries. RDC’s membership includes Alaska Native corporations, local communities, organized labor, and industry support firms. RDC’s purpose is to encourage a strong, diversified private sector in Alaska and expand the state’s economic base through the responsible development of our natural resources. 2025 State Legislative Priorities

Advocate and provide support for policies and legislation that encourage responsible resource development.

Stable, long-term fiscal plan • Advocate to limit unrestricted general fund (UGF)* spending to a sustainable level and implement a meaningful limit to spending. • Encourage the legislature to allocate a percentage of the Permanent Fund earnings to the UGF to support essential services first. • Advocate to diversify and expand the economy in Alaska, by reducing the budget deficit to encourage long-term investment in the private sector. • Advocate for the utilization of federal funds to efficiently advance key statewide infrastructure projects to support resource development.

*UGF includes: Operating budget, capital budget, statewide obligations, but not the deferral of liabilities.

A robust private sector and a stable permitting process • Advocate for tax policy and regulatory stability that enhance the State of Alaska’s competitiveness for all industries to attract new investment and grow the economy. • Encourage elected officials and state agencies to defend and promote Alaska’s effective and rigorous regulatory process. • Support state assumption of primacy over federal permitting programs to bring stability, efficiency and certainty to support resource development. • Support and advocate for state and local efforts to lift federal public lands orders, such as PLO 5150, and regulations limiting and/or restricting reasonable access, development and delivery of state resources. Initiative reform • Advocate for changes to the initiative process that would nullify a ballot initiative if a court finds any segment of the initiative to be unconstitutional. • Advocate for changes to the initiative process that create more transparency and better public policy in a comprehensive and balanced manner, to equally benefit both the voters and the legislative process.

akrdc.org

“I hope young Alaskans can recognize that the next wave of innovation is happening right here at home if they take the time to look for it.” — Connor Hajdukovich, RDC External Affairs and Policy Coordinator

INNOVATION, OPPORTUNITY ABOUND IN OUR INDUSTRIES

A T A TIME WHEN OTHER STATES ERS SUCH AS NEW TECHNOLOGY SECTORS, NICHE SERVICE INDUSTRIES, AND GROWING GOLIATHS IN HEALTH CARE, ENTERTAIN- MENT, AND RETAIL, YOUNG ALASKANS TODAY CAN SEEM FRUSTRATED BY OUR STATE’S LACK OF DIVERSE ECONOMIC DRIVERS. However, the narrative that Alas- ka’s economy is stagnant or limited misses an important point: Our state’s resource-producing industries — oil and gas, mining, fisheries, forestry and tourism — are constantly innovating in ways that are redefining Alaska’s future. AND COUNTRIES ARE PROFITING FROM EMERGING ECONOMIC DRIV- In today’s rapidly changing world, where mega companies like Ama- zon, Apple and Tesla are leading the charge on innovation, it can be easy to overlook the innovation taking place within our own backyard. The truth is that innovation doesn't only happen at the scale of massive corporations — it’s happening every day in Alaska’s resource industries, at albeit smaller levels, where companies are finding new solutions to longstanding chal- lenges. Take the oil and gas industry, for example. Companies are significantly reducing the size of drilling platforms, finding efficiencies in drilling and well

plastic used in everyday products. These are just a few examples that I’ve personally noticed in how inno- vation is taking place across Alaska’s resource industries, but there are countless others. Alaska’s main economic revenue contributors have often been called a three-legged stool, though there are a couple of different versions floating around, it generally consists of the oil and gas sector, federal funding, and the third leg being all other sectors including seafood, mining, tourism, timber and transportation. This analo- gy may paint a somewhat constrained economic picture, but at least two out of the three legs of this stool are not only innovating and unlocking new potential within their respective indus- tries, they are creating a launching off point for new businesses by allowing Alaska to provide a lower tax structure and lower energy costs to the benefit of residents. With that in mind, I hope young Alaskans can recognize that the next wave of innovation is happening right here at home if they take the time to look for it. So, let’s continue to encour- age innovation and economic diversity in Alaska by first fortifying our indus- tries working to responsibly develop our state’s abundant resources.

production, and implementing drone technology, all of which reduces both their environmental footprint and operational costs. Similarly, the mining sector is applying world-class recla- mation practices and advanced water treatment techniques to restore land to its natural state following mining ac- tivity. Both sectors have made remark- able progress in geological mapping and are now exploring Carbon Cap- ture, Utilization, and Storage (CCUS) technologies to minimize their en- vironmental impact while creating potential for new economic drivers for the state. The tourism industry also has a number of innovative infrastructure projects in the works, like an advanced cruise ship port equipped with shore power to reduce emissions and im- prove quality of life for Alaskans. Meanwhile, the fisheries industry has made strides in sustainability, in some cases being able to utilize more than 99% of a fish being processed and even developing fish oil to power industrial generators. The forestry industry, too, is in- novating by producing high-density wood products that offer more effi- cient heating with fewer pollutants, implementing better forest manage- ment practices to reduce wildfire risks, and creating sustainable alternatives to

ALASKA RESOURCE REVIEW WINTER 2025

VOLUME 2 | ISSUE 1 | WINTER 2025 ALASKA RESOURCE EDUCATION NETS FUNDING TO REACH FUTURE WORKFORCE

individual donations. The 501(c)(3) educa- tional nonprofit is a partnership between the State of Alaska Department of Education and private companies engaged in the re- source industries. — Courtesy ARE

and math. By collaborating with industry professionals and educators, ARE aims to spark an interest in students about Alaska’s natural resources. Founded in 1982, ARE is funded through state and federal grants, and corporate and

Alaska Resource Education is excited to announce the U.S. Department of Energy has awarded ARE up to $300,000 in fund- ing as part of its Clean Energy Careers for All program. The program supports educa- tional nonprofits with a mission of spreading awareness about careers in the energy sector. “This funding will benefit hundreds of students by allowing us to further our mis- sion of spreading awareness about Alaska’s natural resources industries and the many amazing careers within those industries,” said Ella Ede, executive director for ARE. ARE will engage high school students in a comprehensive curriculum that highlights Alaska’s natural resources and the associ- ated diverse career opportunities, with an emphasis on Alaska’s minerals and their im- portance in the development of renewable energy. This will be part of ARE’s Our Alas- ka program within the Anchorage School District’s Career Academics and at Kusilvak Career Academy. The funds will also help educators from the Lower 48 travel to Alaska and participate in ARE’s Natural Resource Management Externship and shadow ARE's Rockstars and Amped on Energy programs. ARE is passionate about Alaska’s future leaders. The nonprofit hopes to inspire stu- dents to explore careers within the state. ARE’s curriculum informs students about Alaska's natural resources, including the resource development industry and its role in Alaska’s economy, as well as the poten- tial risks and cutting-edge safety measures. ARE’s curriculum is engaging, hands-on, and includes lessons for all ages. The U.S. Department of Energy awarded seven nonprofits this funding as part of CE- C4A which supports workforce development programs that promote STEM education and exposure to renewable energy career options. ARE and the other nonprofits are eligible to receive additional funding based on their performance during the initial phase. ARE provides statewide educational opportunities to students and teachers. We distribute innovative K-12 education curric- ulum that meets Alaska State Science Stan- dards and has been aligned with the com- mon core in social studies, language arts,

www.AKRDC.org

“While it’s true that Greenland is rich in minerals and potential energy reserves, Alaska — undeniably a world-class energy and resource powerhouse — is richer. ”

— U.S. Sen. Dan Sullivan, R-Alaska

ALASKA OFFERS EVERYTHING GREENLAND DOES, AND MORE

I ’M SURE ALASKANS HAVE HEARD ABOUT PRESIDENT ELECT-TRUMP’S IDEA OF BUYING GREENLAND. BUT AS IT CONTINUES TO BE DISCUSSED, IT’S IMPORTANT TO REMEMBER THAT THIS ISN’T THE FIRST TIME THAT A U.S. PRESIDENT HAS RECOGNIZED THE STRATEGIC LOCATION AND RESOURCES THAT THE TERRITORY OFFERS. After the Alaska Purchase, President Andrew Johnson, at the urging of Sec- retary of State William Seward, con- sidered buying Greenland during the 1860s. In 1946, the Truman administra- tion offered $100 million to Denmark to acquire Greenland. So buying Green- land is not an unprecedented idea. But it’s also important to remember that one U.S. state offers everything that appears to be motivating Presi- dent Trump, and other presidents, to consider buying Greenland in the first place. That state is ours: Alaska. As we all know, the problem is that the Biden Administration, like other recent Dem- ocratic administrations, has spent its time trying to turn Alaska into one gi- ant national park, as opposed to recog- nizing what our state really represents: an incredible strategic asset for America that already has everything Greenland would offer. Some have argued that Greenland would provide the U.S. a gateway to the Arctic and its opening shipping lanes. We don’t need Greenland for the U.S.

tition. Another impetus for buying Green- land is its role in missile defense. While Greenland plays an important part in early warning networks, the real corner- stone of missile defense for America is Alaska. Any missiles launched by adversaries like Russia, China, or North Korea — ballistic, hypersonic, or cruise missiles — aimed at any place in our country would likely traverse over Alaska. For that reason, the vast ma- jority of the radar systems and ground- based missile interceptors protecting the entire United States from attack are already based in Alaska. But in order to create an Iron Dome for America — a priority of President Trump — we need to do more to add to our national ballistic missile interceptor capability in Alaska, as well as build up a robust layered missile defense and space-based missile sensor capability. Alaska is also home to critical military assets needed for a major war, including the largest concentration of fifth-generation fighters on the planet, with over 100 F-22s and F-35s home- based in Alaska, as well as the newly established U.S. Army 11th Airborne Division. Also, while it’s true that Greenland is rich in minerals and potential energy reserves, Alaska — undeniably a world- class energy and resource powerhouse

to get into the Arctic game. We know that America is already an Arctic nation because of Alaska. We just need to be serious about how we utilize Alaska’s strategic location, particularly as it relates to military threats from Russia and China. The Russians and Chinese certainly recognize that Alaska and the Arctic are regions at the forefront of great power competition. In the last two years alone, there have been 12 air incursions into Alaska’s air defense identification zone (ADIZ) by Russian and Chinese mili- tary aircraft — including an unprece- dented joint Russian-Chinese strategic bomber operation this past summer. Further, on at least three occasions in the past two years, Russian and/or Chinese warships traversed our waters, including an unprecedented 12-ship joint Chinese-Russian naval task force. We need to build up our ability to respond to these Russian and Chinese threats in the Arctic in order to deter aggression. We’ve made progress in our Arctic military build-up, but to seri- ously counter the dictators in Moscow and Beijing, we must focus on making serious investments in real capabili- ties — communications, cold-weather materials, radar technology, subsurface sensing, airfields, deep water ports, and refueling capacity — to help the U.S. succeed in this new Cold War compe-

ALASKA RESOURCE REVIEW WINTER 2025

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Alaska's rich deposits of critical and rare earth minerals remain essential to the state and federal economies, and must continue to be extracted.

announce $600 million in aid to build a railroad in Angola to help that country produce and market its critical miner- als. This is insane. During the first Trump adminis- tration, we made advances on all these fronts for Alaska and celebrated them for what they were: enormous advan- tages for our nation. Fortunately, Pres- ident-elect Trump has said repeatedly that Alaska, with its vast resources and its strategic location, will again be a key focus in the next Trump Adminis- tration. And the hard-working Alas- kans who help us realize our resource potential will be thanked, not demon- ized as they have been under the Biden Administration. Buy Greenland? If the price is right and the Danes are willing to sell, sure. But it is important to keep in mind what the father of the U.S. Air Force General Billy Mitchell prophetically said in 1935: “I believe that in the fu- ture, whoever controls Alaska controls the world. I think it is the most strate- gic place in the world.”

Road debt trap for countries in Asia. Alaska also has a wealth of miner- als and metals, with one of the largest known graphite deposits in the world. It has the tenth largest deposit of gold in the world. We have one of the largest zinc mines in the world. We also have a trove of critical and rare earth miner- als essential for our national defense, economy and renewable energy sector. The United States is almost wholly dependent on China for many of these minerals. But President Biden, cowing to radical environmental groups, has worked overtime to make sure that America’s minerals and metals in Alas- ka stay in the ground. For instance, the Trump Adminis- tration approved a road that is needed to access critical minerals and metals from one of our country’s richest de- posits — the Ambler Mining District in Alaska’s Interior. But the Biden Ad- ministration killed that road last June, even though federal law mandates it. Of course, that didn’t stop Joe Biden from recently traveling to Angola to

— is richer. Alaska holds an estimat- ed 40 billion barrels of oil reserves, and roughly 235 trillion cubic feet of natural gas. In just one oil field alone — Prudhoe Bay — Alaska reinjects as much natural gas every day as Oregon, Washington and California consume. Resource development is the heart and soul of the Alaskan economy. We continue to make progress — despite opposition from senior Biden officials — on commercializing these massive natural gas reserves with a large-scale LNG project that would get clean-burning Alaska natural gas to Americans, our Alaska-based military, future data centers that love Alaska’s cold, and our allies in Asia who des- perately need to diversify their supplies of natural gas away from countries like Russia and Qatar. This much-needed American LNG project would put America first by creating thousands of good-paying jobs, reducing our trade deficit by an estimat- ed $10 billion dollars annually, and being an effective counter to China’s Belt and

www.AKRDC.org

DESPITE SACKETT, ALASKA UNDER FEDERAL THUMB

Wetlands regulations remain muddled despite High Court's ruling BY TIM BRADNER THINK THE U.S. SUPREME COURT SOLVED THE WETLANDS REGULATION? THINK AGAIN. Alaskans hoped the high court’s ruling on federal regulation of wetlands last May would clarify this thorny and complex is- sue, and in Alaska’s favor. But things are still muddled, say sources familiar with the issue. In its historic Sackett decision, the court ruled that federally regulated wa- ters, called wetlands, “Waters of the United States,” under the U.S. Clean Water Act or “wetlands” must be: (1) “relatively permanent, standing or continuously flowing bodies of water described as navigable streams, oceans, rivers, or lakes.” (2) And adjacent “wetlands” with a continuous surface connection to such wa- ters such that they are indistinguishable. On its face, the ruling would appear to exempt large areas of land from the defini- tion of federal jurisdictional wetlands. This would leave states to do the regulating and issuing of permits instead of the U.S. Army Corps of Engineers (USACE). Alaska is heavily affected because much of the state is covered by land that is only wet for part of the year, or with no visible surface flow of water, which before Sackett, had been deemed federal wetlands. Construction projects that disturb wet- lands, as many do, act as a trigger for a Na- tional Environmental Policy Act (NEPA) review and permit process. Such permits can take years or decades, and are often litigated by environmental groups. A sep- arate USACE Section 404 permit and its expensive requirements to mitigate the impacts of the disturbance also is required.

As seen from a plane, many areas of the North Slope are still wet in the summer.

lands to be so close to an ocean, river, lake or stream was dropped out of the regula- tions. Instead, the USACE regulations rely on various asserted “connections” that lack surface water and connections that are not continuous, which conflicts with the Sack- ett decision. The Pacific Legal Foundation, which argued Sackett in the Supreme Court, said EPA has taken a position that the

But post-Sackett, the U.S. Environ- mental Protection Agency, under former President Biden, pushed back against the Supreme Court decision with its own reg- ulatory interpretation of “continuous con- nection.” This came in August, when the EPA is- sued a new rule on how it will comply with the decision. The USACE regulations con- tinue to assert authority over many types of isolated wetlands and dry land. The Court’s decision requiring adjacent wet-

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Photo Courtesy Kinross Alaska Alaska already has some of the strictest water quality standards in the United States. and giving primary authority to the state would maintain that while allowing more efficient permitting.

www.AKRDC.org

The wetlands “Waters of the United States” rule, or WOTUS, has been altered by each presidential administration during the past 20 years. Each attempted to establish its own definition.

ed wetlands and which aren’t under the all-important federal “jurisdiction” test. Regulated wetlands remain subject to federal permits administered by the US- ACE and with the EPA also involved. The USACE doesn’t tell a developer whether the lands are regulated wetlands. The de- veloper must do a study and convince the agency that they aren’t. Or refuse to get a permit and face penalties that could in- clude jail and massive fines. It is possible that upland tundra, dry in the summer, would not be subject to the “continuous flow” test, but large areas of the North Slope are still wet in the summer. As before Sackett, developers' costs include not only the NEPA permit appli- cation process and the wetland study but also the time this takes and the potential cost of compensatory mitigation the US- ACE may require. The USACE also may or may not agree with the developer’s study results. Hoping to help ease this uncertainty, the Alaska Industrial Development and Export Authority (AIDEA), the state’s de- velopment finance corporation, has devel- oped a tool that can help assist. “Because the presence or lack of fed- eral wetlands can delay a project for years and cost huge amounts of funds, AIDEA worked with professional hydrologists to develop a method, a tool, for applying the new post-Sackett wetlands determination

standards,” AIDEA’s Executive Director Randy Ruaro said. The new tool is called “JEM,” or Juris- diction Evaluation Method. Whether the federal government has jurisdiction over the wetlands is key to whether or not the USACE controls the permits or whether the state does. AIDEA could begin using this tool for the first time when it initiates the federal Environmental Impact Statement process for its planned West Susitna Access Project early this year. This would show how the USACE will respond to the wetlands de- fined with JEM. The West Susitna Access Project is a proposed 80-mile industrial road that would open large areas of the Matanus- ka-Susitna Borough to economic and community development. If built, the road could help mining companies explore dis- coveries near Skwentna. Demonstrations of AIDEA’s new tool show promise, the authority said. Reduc- tions of federally regulated wetlands up to 80% are indicated compared with the pre-Sackett analysis, which often makes blanket assumptions that large areas of land fall under federal jurisdiction. The authority believes its new JEM will reflect the significantly reduced amount of federal jurisdictional wetlands, Ruaro said. Alaska Gov. Mike Dunleavy said this will be a significant turning point.

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“continuous connection” need not be aquatic, i.e., no water flow, is sufficient to bring adjacent lands under regulation. This sidesteps the plain language in the Sackett decision, the Pacific Legal Foundation said, nullifying it in several U.S. states, including Alaska. Until the USACE regulations inter- preting Sackett are challenged and struck down, the pre-Sackett regulatory defini- tions remain in effect in large parts of the United States, including Alaska. In the nation, the practical effect for now is that 27 states including Alaska still fall under the USACE’s pre-Sackett rules while 23 are under the USACE’s new rule post-Sackett, which doesn’t appear to clar- ify things. The wetlands “Waters of the United States” rule, or WOTUS, has been altered by each presidential administration during the past 20 years. Each attempted to estab- lish its own definition. A cascade of litigation resulted. There are now several challenges to the latest US- ACE regulations. These cases will eventu- ally result in court decisions, but the ques- tion may once again land in the nation’s high Court in some form. Nothing much seems to have changed in Alaska. Developers still have to deter- mine which lands are federally regulat-

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“By precisely defining federally-desig- nated wetlands in conformity with the U.S. Supreme Court Sackett opinion, we have brought clarity to the process and reduced federal control,” the governor said. “Unfortunately, even after Sackett and another important High Court decision, federal agencies are attempting to retain authority that Congress never gave in stat- ute,” Ruaro said. “It is this kind of control and endless litigation that leads to delays in many projects.” Dr. Eddie Packee, a recognized Alaska soil and water specialist, developed JEM for AIDEA. “Through rigorous research and col- laboration, we have meticulously crafted a pragmatic and legally defensible method to assess and delineate federally regulated wetlands accurately,” Packee said. Packee earned his doctorate in mining from the University of Pretoria in South Africa in 2005. He received his master’s and undergraduate degrees from the University of Alaska Fairbanks. He also is a certified professional soil scientist with a specialty in stormwater erosion and sediment control and has per- formed erosion and sediment control-re- lated work since 1992. Packee is a Master Instructor for the Alaska Certified Erosion and Sediment Control Program, a collabo- ration of government agencies and Alaska contractor associations. AIDEA’s new tool could help Alaska de- velopers but the common assumption is that until Sackett is further defined by the lower courts, it must be assumed that large new Alaska projects will still fall under the feder- al Clean Water Act and USACE jurisdiction, and the requirement to go through the federal Environmental Impact Statement process. One option for Alaskans, however, is for the state to assume “primacy” for the Clean Water Act permits, which could at least have state rather than federal officials administer permits, although the broad re- quirements of the Clean Water Act would still control. The state has investigated this, but the cost of primacy has been a concern, so no action is currently underway. Primacy is another area addressed by the Sackett decision that the Corps has re- sisted. In Sackett, the court noted that un- der the Clean Water Act, states are to have primacy control over resource development decisions. The court has not implemented this part of the decision.

“Because the presence or lack of federal wetlands can delay a project for years and cost huge amounts of funds, AIDEA worked with profes- sional hydrologists to develop a method, a tool, for applying the new post-Sackett wet- lands determination standards."

— Randy Ruaro, Executive Director, Alaska Industrial Development and Export Authority

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NORTH SLOPE OIL OUTPUT TO RISE IN NEAR FUTURE

State: Fewer wells drilled last year; new projects set to boost production BY TIM BRADNER ALASKA OFFICIALS TOLD STATE LEGISLA- TORS IN JANUARY THAT PRODUCING FIELD OPER- ATORS ON THE NORTH SLOPE ARE FACING RISING COSTS AND INCREASED LOCAL COMPETITION FOR CONTRACTORS AND EQUIPMENT DUE TO NEW FIELDS IN CONSTRUCTION. The new fields are Pikka, being built by Australia-based Santos Ltd. and Repsol, based in Madrid, as well as the new Willow field by ConocoPhillips. Deputy Natural Resources Commis- sioner John Crowther told the House Fi- nance Committee that producing field op- erators drilled fewer new production wells last year than they had forecast partly due to demands on equipment and labor. This is contributing to a dip in expected production in 2025. However, field output is expected to gradually increase beginning in 2026 as new projects in construction be- gin producing. Travis Peltier, petroleum reservoir engi- neer in the state Division of Oil and Gas, told legislators in the briefing that the large legacy fields on the North Slope are ex- periencing 4% to 5% annual declines but maintaining that against the steeper natural decline in aging reservoirs requires sub- stantial investment in new drilling and well work by operating companies. But sustaining that production is a chal- lenge given the competition for equipment. Attracting skilled workers to remote jobs in northern Alaska is another a challenge. Santos and ConocoPhillips both said they expect to employ 2,000 workers this winter on the North Slope. Wages for construction and oil services workers are rising as a result. Crowther said average production from existing fields is estimated at 480,000 barrels per day in 2025, which is up from actual pro-

Deputy Natural Resources Commission- er John Crowther told the House Finance Committee that producing field operators drilled fewer new production wells last year than they had forecast partly due to de- mands on equipment and labor. This is con- tributing to a dip in expected production in 2025. However, field output is expected to gradually increase beginning in 2026 as new projects in construction begin producing.

in 2029 of ConocoPhillips’ Willow project, which is also now in construction. However, the picture isn’t as pretty for Cook Inlet, in Southcentral Alaska, where aging 60-year old oil fields are declining in output. Production averaged 15,000 barrels per day in 2018 but had dropped to 8,500 barrels per day in 2024, Peltier said. The Cook Inlet Basin was Alaska’s first petroleum-producing region with onshore production beginning in 1958 and offshore production in 1965. In its 1970s heyday, Cook Inlet produced 200,000 barrels per day of crude oil. Crowther said Cook Inlet is overshad- owed by the North Slope but its produc- tion of light, sweet crude oil is important to the nearby Marathon Petroleum Co. re- finery on the Kenai Peninsula, which sup- plies most of Alaska’s gasoline and a good portion of jet fuel demand at Anchorage’s international airport, which is one of the world’s busiest air cargo hubs. As Cook Inlet production declines, Marathon is having to bring in crude oil from other places including North Slope oil shipped by shuttle-tanker from Valdez, ter- minus of the Trans Alaska Pipeline System.

duction of 461,000 barrels per day in 2024 thanks to incremental additions in fields by operators. However, the state’s estimates, which are based on information from field operators as well as analysis by state petroleum engi- neers, have been running about 2% higher than actual production. Estimates by the field operators, which are provided to the state, also are higher than actual production. Among the producing fields, Hilcorp Energy has been successful in adding new production in its Milne Point field with new wells and two new production pads, Peltier said. Milne Point is now averaging about 47,500 barrels per day and is expected to soon reach 50,000 barrels per day. All other producing fields are experiencing 4% to 5% annual declines, Peltier said. The state Division of Oil and Gas is now forecasting an increase from 480,000 bar- rels per day in 2025 to an average of 500,000 barrels per day in 2028 and 530,000 by 2030, a result of new output from the Pikka field scheduled to begin production in 2026. Production is expected to reach 650,000 barrels per day by 2034 following startup

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Photo by Judy Patrick ConocoPhillips' Willow project (above) and Santos' Pikka project, being built by Australia-based Santos Ltd. and Repsol, will add to North Slope oil output in coming years after a slight decline noted by state officials.

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MURKOWSKI: NEW LEASE SALES COMING IN ANWR

No bids were offered in January lease sale amid restrictive stipulations BY TIM BRADNER U.S. SEN. LISA MURKOWSKI, R-ALASKA, SAYS NEW LEASE SALES WILL BE PLANNED IN THE ARCTIC NATIONAL WILDLIFE REFUGE IN NORTHERN ALASKA. NEW PRESIDENT DONALD TRUMP HAS PROMISED THE SAME. Two sales were held in the refuge in 2021 and in early January under provi- sions of the 2017 Tax Act. Murkowski said in an interview that the statute re- quires a minimum of two lease sales, but that more can be held. Under existing law, “Coastal Plain (ANWR) lease sales are discretionary af- ter 2024. We don’t have to amend the Act to facilitate future sales, but that would be one way to do. The Senator is looking at all options with her team,” Murkowski spokesperson Joe Plesha said. It’s unclear how much industry inter- est there is in ANWR. Most geologists be- lieve the potential is good in the northern coastal plain of the refuge near the Beau- fort Sea coast, and its proximity to state- owned lands to the west, where major oil and gas discoveries have been made, re- inforces that. Major companies were interested in years past but have recently been deterred because of the intense political contro- versies over drilling in the wildlife refuge. That can change under Trump’ pro-drill- ing stance, however. There were no bids offered in the January lease sale but Murkowski said outgoing Interior Secretary Deb Haa- land basically sabotaged the sale with highly restrictive stipulations and a small amount of acreage offered, 400,000 acres, the minimum required under the Tax Act.

Major companies were interested in years past but have recently been deterred be- cause of the intense political controversies over drilling in the wildlife refuge. That can change under Trump’ pro-drilling stance, however.

Former President Joe Biden opposed leasing in the refuge and Haaland’s poli- cies were designed to discourage bidding, Murkowski said. The previous lease sale in 2021 held as Trump was leaving office in his first term offered more acreage and did attract bids including from the state of Alaska devel- opment corporation, the Alaska Indus- trial Development and Export Authority (AIDEA). Haaland subsequently canceled the leases arguing that the Trump Adminis- tration conducted a poor environmental review in 2019 and 2020. AIDEA filed a lawsuit, contending Haaland lacked au- thority to cancel the leases. AIDEA’s lawsuit is now pending in an Alaska federal court, and if U.S. District Court Judge Sharon Gleason rules Haa- land’s cancellation was unlawful, the leas- es will be restored to the state authority. AIDEA had planned to do seismic and other pre-drilling work on its leases and then negotiate sub-lease deals with com- panies, its Executive Director Randy Ru- aro has said, but Haaland denied permits to do work prior to cancelling the leases. If AIDEA recovers its leases in court, it can begin exploration and development work even before new lease sales are held under Trump. There will be lawsuits against any new leasing filed by national conservation groups, however. A new twist in this is

that the federal Environmental Impact Statement, or EIS, for the January lease sale prepared by Haaland, which replaced one done earlier under Trump’s first term, asserts new dangers to polar bears and caribou from drilling. The Trump Administration could conduct new lease sales using Haaland’s EIS or do a new one, but any weakening of lease restrictions and environmental protections will have to be justified by science. Drilling in the Arctic refuge has been a political football since the 1980s. The 19-million-acre Arctic refuge was created in 1980 by the Alaska National Interest Lands and Conservation Act as one of late President Jimmy Carter’s proudest accomplishments. Most of the refuge was designated as wilderness, a formal and highly restric- tive federal land classification, but 1.5 million acres on the northern coastal plain was reserved for study of its petro- leum potential and potential leasing. Congress had approved leasing, how- ever, and conservation groups waged in- tense battles to block leasing. They suc- ceeded until Trump came into his first term in 2016 and initiated what became the 2017 Tax Act. Alaska’s Sen. Murkowski attached an amendment to the act, which passed in 2019, granting congressional approval for ANWR leasing.

ALASKA RESOURCE REVIEW WINTER 2025

ALASKA CRUDE OIL SEES ALTERATIONS IN MARKETS

West Coast states now required to document carbon intensity of oil BY TIM BRADNER DESPITE A NEW PRO-DEVELOPMENT U.S. PRESIDENT, ALASKA CRUDE OIL IS FACING CHAL- LENGES IN ITS KEY WEST COAST MARKETS DUE TO CARBON RULES IN CALIFORNIA, OREGON AND WASHINGTON. Alaska crude oil production is set to increase with new projects under construc- tion. However, there are questions as to where the new oil will go and whether new clean fuel standards in West Coast states are devaluing Alaska crude oil. California and Washington state refin- eries are now required to calculate the car- bon intensity of crude oil they purchase. “Alaska oil could be competitively dis- advantaged,” said Nicholas Fulford, an an- alyst with Gaffney Cline, a consulting firm. The calculation includes the complete production cycle from production opera- tions, pipelines and tanker shipments, all which put Alaska crude at a disadvantage compared with conventional crudes and shale oil from western states and Canada. Alaska scores at 15.9 in the Washington carbon intensity rankings compared with 8.4 for western Canadian crude oil and 9.3 for North Dakota oil, said Anthony Penni- no, an Anchorage-based energy consultant. Canadian oil sands crude has the worst ranking at 23. These rankings measure carbon emis- sions along the production and supply chain and shouldn’t be confused with qual- ity measures of the oil itself, such as the API gravity. Much of Alaska’s disadvantage in the carbon ranking comes from the emis- sions from North Slope production plants, Pennino said. When they buy crude oil with higher carbon intensity scores, like from Alaska,

In the 1980s and 1990s, Alaska supplied almost all crude oil imported into California and the Pacific Northwest.

bon capture projects. The California and Washington state carbon rules aren’t the only challenge facing Alaska producers. Recent closings of refin- eries in California and the shift of demand for lighter-grade crude oil have knocked Alaska out of a market it once dominated. In the Pacific Northwest, where Alaska is still the main supplier, refineries have ac- cess to increasing volumes of shale oil, which have lower carbon intensity scores than Alaska crude. All this means more North Slope oil

the new rules require refiners to purchase offsets to reduce the carbon intensity of the supply chain, which imposes a financial penalty. The Washington standards will tighten under legislation passed in 2021. Fuel sup- pliers will have to show a 20% decrease in carbon intensity below 2017 in the supply chain by 2037, using 2017 as a base year un- der the Washington statute. “As these standards become more strin- gent, they will significantly affect the value of Alaska’s crude oil,” said Frank Paskan, an affiliate professor with the University of Alaska Fairbanks, who is advising on car-

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ALASKA RESOURCE REVIEW WINTER 2025

VOLUME 2 | ISSUE 1 | WINTER 2025

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