OPENS Alaska Act of 2017

Mr. President, Senator Sullivan and I introduced a bill, S. 883, the Offshore Production and Energizing National Security Alaska Act of 2017, to lift a damaging Federal moratorium, reopen Alaska's energy-rich Arctic waters to responsible production, and ensure our home State receives a fair share of the revenues from development off our coasts.

According to the U.S. Geological Survey, the Arctic contains 22 percent of the world's undiscovered, technically recoverable oil and gas resources. The Federal Government projects that the Beaufort and Chukchi Seas alone contain an estimated 23.6 billion barrels of oil and 104.4 trillion cubic feet of natural gas. Yet, despite that prolific potential, the Obama administration spent much of the past 8 years systematically putting the region off limits.

It began with the cancellation of lease sales scheduled for our Arctic Outer Continental Shelf. It continued with critical habitat designations, the imposition of burdensome new rules, and a constantly shifting administrative approach that seemed designed to make commercial operations impossible. We saw new withdrawals in our Arctic OCS in early 2015, followed by a decision by President Obama, just days before he left office, to withdraw nearly all of the region from future leasing. Those decisions ran directly contrary to the views of the vast majority of Alaskans, who overwhelmingly support the responsible development of our Arctic OCS. Those decisions ran contrary to the promises made to Alaskans, at statehood and repeatedly in the years since then, that we would be allowed to access our resources to help build our State. Those decisions have already cost Alaskans jobs and revenues and today continue to deprive us of a golden opportunity to provide for our families, end our economic recession, and refill our Trans-Alaska Pipeline System.

Our bill, the OPENS Alaska Act, recognizes our needs and opportunities in Alaska, it rejects the heavy-handed decisions made against our State in recent years, and it puts our policies for the Arctic OCS on a better track.

First, it repeals President Obama's so-called 12(a) withdrawal of nearly all of the offshore Arctic. This is a simple necessity, before leasing can occur. It is not a statement about the President's current legal authority to amend, modify, or revoke a withdrawal made under section 12(a) of the Outer Continental Shelf Lands Act. I believe our new President has all the authority he needs to revoke the Alaska withdrawals, and I hope he will do just that. If he does, precedent will be on his side. In the meantime, our legislation makes clear the position of Alaska, which is that we do not support the withdrawal and want it gone by any possible legal means.

Next, our bill would create a new nearshore Beaufort Planning Area. The State of Alaska currently conducts annual lease sales in the area from zero to 3 miles offshore. The establishment of a separate planning area in the adjacent nearshore zone will provide a real, near-term opportunity to provide vital throughput into the Trans-Alaska Pipeline System, known as TAPS, because of its proximity to existing infrastructure. Projects in this area are easier, faster, and less expensive.

Our bill would also provide for additional lease sales in the Nearshore Beaufort Sea and Cook Inlet Planning Areas. By lifting the withdrawals in the Beaufort and Chukchi Seas, those areas would be eligible for leasing in the next Five-Year OCS Leasing Program or a supplement to our current program. Frequent and predictable lease sales are needed to create stability and certainty for investors, Alaska, and the United States.

It is also important that Alaska and Alaskans receive fair compensation for any exploration, development, and production that occurs in the Arctic OCS. Under current law, no matter how much energy we provide for the rest of the Nation, Alaska will receive none of the revenues. That arrangement is widely recognized as unfair, and so my bill devotes a reasonable share of the revenues that will only be generated as a result of this bill, and as a result of the waters that are only part of the United States by virtue of Alaska, with our State.

We have divided revenue sharing into two time periods, from 2017 to 2027 and from 2027 onwards, to reflect our differing needs during the exploration, development, and production phases. During the initial 10- year period, our bill proposes that 7.5 percent of the revenues be shared with the State and 7.5 percent of revenues be divided between coastal political subdivisions. The division between coastal political subdivisions is based on distance from the lease tracts, with 90 percent of the funds going to areas within 200 miles and 10 percent reserved for coastal political subdivisions that are beyond 200 miles but determined by the State of Alaska to be staging areas.

In addition, our bill would allocate 2.5 percent of the revenues it generates to fund competitive grants for workforce development in support of OCS development, 2.5 percent to fund the North Slope Science Initiative, 2.5 percent to the Secretary of the Interior to support offshore development and the establishment of pipeline rights-of-way on Federal land associated with Beaufort and Chukchi development, and 2.5 percent to the Tribal Resilience Program established by the act. The remaining 75 percent would go to the U.S. Treasury, to help pay down our national debt.

Following the initial 10-year period, we propose to divide the revenues slightly differently, with 50 percent going to the Treasury, 30 percent to the State, 7.5 percent to coastal political subdivisions, and 12.5 percent to the Tribal Resilience Program established by the act. These divisions do not apply to what is known as the 8(g) zone, such as the Nearshore Beaufort, where Alaska currently receives 27 percent of revenues.

The Tribal Resilience Program established by our bill, which is national in scope, would provide grants for a number of critical purposes. These funds could be used to relocate villages or communities experiencing or susceptible to coastal or river erosion, to construct infrastructure to support emergency evacuations, to restore or repair infrastructure damaged by melting permafrost or coastal or river erosion, to install and manage energy systems that reduce energy costs and greenhouse gas emissions, and to construct and maintain social or cultural infrastructure that supports resilient communities.

The OPENS Alaska Act will allow our home State to produce more of its vast offshore energy resources, which is a priority for the vast majority of Alaskans. It will help us create good jobs, generate billions of dollars in new revenues, and ensure a stable footing for our State for generations to come. I urge the Senate to recognize the improvements this bill makes to our current policies and to join Senator Sullivan and I in supporting its passage in this Congress.