State sues for lost revenue from Biden's cancellation of ANWR leases

The state of Alaska has filed a lawsuit in the U.S. Court of Federal Claims, where it hopes to make the federal government pay for lost revenue caused by nine oil and gas leases canceled by the Biden administration in the coastal plain of the Arctic National Wildlife Refuge.

The lawsuit is one of several efforts by Gov. Mike Dunleavy to hold the federal government accountable for the costs of its environmental policies, particularly when those decisions have serious economic impacts on the state and its citizens, the Justice Department said.

“Producing oil and gas from these leases could greatly contribute to our nation’s energy independence and our state’s economy,” Dunleavy said in a statement. “This reversal by the federal government goes against the direction of Congress and deprives Alaska of its rights to natural resources.”

As a condition of joining the Union, Alaska was promised the opportunity to build its economy through resource exploitation.

“The Biden administration’s decisions since day one have been designed to make Alaska inaccessible to resource development at the expense of Alaskans and Alaskans seeking to provide for their families,” said Alaska Attorney General Treg Taylor. “While the rest of the nation celebrates the Fourth of July, the federal government has systematically undermined the state’s ability to maintain its economic independence. This is not what Alaskans were promised when they gained statehood, and it’s why the state must continue to fight.”

“We know these resources can be harvested safely and responsibly, with the support and involvement of the local communities that live in the 1002 area,” said John Boyle, commissioner of the Alaska Department of Natural Resources. “The only obstacle is the Biden administration’s radical environmental agenda.

According to federal government documents, there are more than seven billion barrels of recoverable oil in the coastal plain, and under federal law the state is entitled to 50 percent of the royalties paid under the leases. Even if only half of the recoverable oil could be produced, Alaska would be entitled to nearly $25 billion. billion in royalty income; this is in addition to the millions owed to the State for its share of the rents and premiums paid.

Once the United States granted these leases, it owed the State a duty of good faith to protect the State’s royalty interests. But in canceling the ANWR leases, the United States breached its obligations. United States policy decisions have consequences, particularly when those decisions lead to a breach of contract. In this case, one of the consequences of the United States canceling the Coastal Plain oil and gas leases was to deprive the State of billions of dollars in statutory revenues. It must now remedy the consequences of this policy by paying the State of Alaska all compensation required by law.

The lawsuit adds to a growing list of challenges to federal actions affecting Alaskans. Most notably, the state has filed lawsuits in federal district court and the Court of Federal Claims challenging the EPA’s unlawful decision to set aside 300 square miles of state land for mining development and is seeking $700 billion in compensation.

Read it complaint here.