Court Deals 'Victory for Arctic,' Blow for Big Oil

In a "victory for the Arctic," a federal appeals court Wednesday ruled in favor of a coalition of native and environmental groups who had challenged the U.S. government's opening of millions of acres in the Chukchi Sea to oil and gas development.

The ruling deals a blow to oil giant Shell's Arctic drilling plans.

In its ruling, the U.S. Court of Appeals for the 9th Circuit found that the estimate for assessing potential environmental effects of the oil leases made by the Bureau of Ocean Energy Management (BOEM) of the Department of the Interior saying that just one billion barrels of oil will be economically recoverable from the remote area was "arbitrary and capricious."

The decision centers on Lease Sale 193, which happened under the Bush administration in 2008, and opened for oil drilling the Chukchi Sea, located off the northwest coast of Alaska, home to native communities and iconic species like polar bears, walruses and whales.

The court's opinion adds that:

The BOEM considered only the best case scenario for environmental harm, assuming oil development. A best case scenario “skew[ s] ” the data toward fewer environmental impacts , an d t h us impedes a “full and fair discussion o f the potential effects of the project.” Native Ecosystems Council v. U.S. Forest Serv., 418 F. 3d953, 965 (9th Cir. 2 005)

Among other things, its estimate informed an assessment of seismic effects, habitat effects, oil production, and the cumulative effects of the sale on global warming. BOEM’s estimate also informed FWS’s determination that Lease Sale 193 would not jeopardize listed species. The record suggests that FWS was close to finding, even under the one billion barrel assumption, that the lease sale would jeopardize the spectacled and Steller’s eiders. Had BOEM not selected the least amount of oil necessary for production, FWS may well have concluded that the listed species were in jeopardy.

The plaintiffs, which include the Inupiat Community of the Arctic Slope, the Center for Biological Diversity, Sierra Club and Oceana, cheered the ruling as a win for the native communities and the remote ecosystem, which is already heavily impacted by ongoing climate change. In a joint statement, the groups said:

Today’s ruling is a victory for the Arctic Ocean. The government has no business offering oil companies leases in the Chukchi Sea. The area is home to iconic species such as polar bear, bowhead whales, and walrus and to a vibrant indigenous subsistence culture. Drilling for oil puts at risk the region’s wildlife and people, and it takes us off the path toward a clean energy future.

While the ruling represents a positive step, the groups urge President Obama to permanently protect the Arctic from risky drilling. The joint statement adds:

We should not have to depend on courts to protect our oceans. President Obama must now take seriously his obligation to re-think whether and under what conditions to allow risky industrial activities in the Chukchi Sea. As Shell’s problems clearly demonstrated, companies are not ready to drill in the Arctic Ocean.

In February last year, Shell announced it was suspending its 2013 Arctic drilling program following a mishap-laden year in which its "ships have caught fire, run aground, lost control and become the subject of criminal investigation," yet the company renewed its bid for Arctic drilling months later.

"Drilling in the Arctic is a doubly bad decision," said Dan Ritzman, Sierra Club Alaska program director, in a statement issued Wednesday. "Not only does it threaten this harsh yet delicate place with permanent damage from an oil spill, it also creates a cycle that worsens climate change—generating carbon pollution that heats the planet while also melting the ice that helps keep it cool."

Echoing Ritzman's concerns, Cindy Shogan, executive director of Alaska Wilderness League, added that,  “Rather than risking a Deepwater Horizon-like disaster in the Arctic by Shell Oil or other leaseholders, the Obama administration should recognize the unique challenges of drilling in the Arctic, including the risks associated with climate change, the lack of scientific data and knowledge about the Arctic, as well as the lack of technology and means to clean up a spill in its often harsh and chaotic conditions. For all of these reasons we should leave the Chukchi Sea free of oil rigs."

The case now heads back to U.S. District Judge Ralph R. Beistline, who could thwart Shell's drilling plans.

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