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Trump’s budget renews debate on Arctic refuge oil drilling

ANCHORAGE, Alaska — President Donald Trump’s plan to help balance the federal budget features a new attempt to open the coastal plain of Alaska’s Arctic National Wildlife Refuge to petroleum drilling.

The effort is the latest chapter in a long-running political fight between two camps: environmentalists, who revere the plain as a maternity ward for polar bears, caribou and migratory birds; and politicians, including those in Alaska’s congressional delegation, who have campaigned for four decades on the promise of jobs and prosperity through “opening ANWR.”

The refuge covers 2,300 square miles (5,957 square kilometres), an area the size of West Virginia and Connecticut combined in Alaska’s northeast corner.

Some things to know about the debate:

WHAT’S THE HISTORY OF THE REFUGE?

Alaska Natives have used it as subsistence hunting grounds for thousands of years. President Dwight Eisenhower in 1960 signed legislation creating the refuge.

Congress in 1980 expanded it and declared much of it wilderness, but threw in a wild card: Recognizing the oil production potential, Congress declared that the coastal plain, tundra stretching from the Beaufort Sea to the foothills of the Brooks Range, should be studied. Another act of Congress and presidential approval can open it to drilling.

HOW MUCH OIL?

The U.S. Geological Survey estimates the coastal plain holds 10.4 billion barrels of oil — compared with 25 billion at the older Prudhoe Bay oil field to the west.

Republican U.S. Sen. Lisa Murkowski of Alaska calls the refuge’s coast plain North America’s greatest prospect for conventional oil production. The plain is 60 miles (97 kilometres) east of the trans-Alaska pipeline, which operates at one-quarter capacity as North Slope oil fields such as Prudhoe Bay have declined.

Alaska is draining billion-dollar savings accounts to pay for schools and roads and is anxious to find more revenue. Gov. Bill Walker says it’s frustrating to be denied access to billions of barrels of oil in an area specifically set aside to be evaluated for resource development within miles of a pipeline that’s three-quarters empty.

North Slope crude was selling for nearly $54 a barrel Tuesday. Alaska could benefit from jobs, additional taxes and federal revenue sharing if the refuge opens.

WHAT STANDS IN THE WAY OF DRILLING?

The refuge is about as wild a place as there is. There are no roads, no campgrounds, not even established trails. And the environmental community and some Alaska Native groups want to keep it that way.

Besides polar bears, the coastal plain is home to muskoxen, the nests of 200 species of migratory birds, and for part of the year, the vast Porcupine Caribou Herd — 197,000 animals that roam between the refuge and Canada’s Yukon and Northwest Territories.

Environmentalists say America should pivot toward renewable energy, not add to climate warming by burning oil extracted from wilderness and generating greenhouse gases.

“The fact it’s happening to what’s supposed to be a refuge for wildlife only adds insult to injury,” said Kristen Monsell, an attorney for the Center for Biological Diversity.

HAS CONGRESS VOTED ON OPENING THE REFUGE BEFORE?

Between the House and Senate, Congress has voted 49 times on the Arctic National Wildlife Refuge, according to the Alaska Wilderness League. Both chambers approved a bill to open the refuge in 1995, but President Bill Clinton vetoed it.

Murkowski is optimistic that a Trump administration and a Republican-controlled Senate and House present a new opportunity to open the area for development.

WHAT WOULD OPENING THE REFUGE DO FOR THE FEDERAL BUDGET?

Interior Secretary Ryan Zinke acknowledged Tuesday that the ANWR item in the president’s proposed budget is a placeholder.

Lease sales are not likely before 2022, Zinke said, and winning bids could generate $3.5 billion over 10 years. If companies find oil, production would generate royalty payments and federal and state taxes.

Zinke said America needs refuge oil in the trans-Alaska pipeline to reach Trump’s goal of “energy dominance” and to help balance the federal budget.

WHAT’S NEXT?

Murkowski has legislation pending that would open the refuge but limit oil company infrastructure, such as drilling pads and roads, to 3 square miles (8 square kilometres).

Environmentalists say that figure is misleading, because oil operations would require multiple drilling pads connected by roads and pipelines. They say Murkowski’s bill would create a spider web of industrial blight across the plain, and if it passes, they would sue to block it.

Dan Joling, The Associated Press




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Methane, deficits and the civil service: three ways politics mattered this week

OTTAWA — Speculation filled the void left by the members of Parliament who vacated the capital for the week to spend time in their ridings.

Who would win the Conservative leadership? Do Prime Minister Justin Trudeau and the young, new French president Emmanuel Macron — who met together on the sidelines of the G7 summit this week —have the makings of a budding bromance? If the Ottawa Senators advance, is it OK to root for P.K. Subban (a moot point now, obviously)?

Whimsical calculations and conjecture aside, the week saw some concrete developments on climate change, deficits and the way the government manages its money.

Here are a few ways federal politics touched Canadians this week.

METHANE

Methane reductions are supposed to be the low-hanging fruit in the world of emissions and controlling climate change. But they’re proving to be tricky for Canada.

Environment Minister Catherine McKenna rolled out a draft of new rules Thursday that would force companies to control methane emissions by checking equipment for leaks, making repairs, using cleaner technologies and reporting their emissions levels back to Ottawa. The rules would be phased in over three years starting in 2020.

There is a cost. Between 2018 and 2035, the government estimates the measures would cost industry $3.3 billion — although it argues the cost of doing nothing and allowing climate change to continue unabated would be even more exorbitant.

Already there is resistance. Some companies are complaining about the expense — especially at a time when the oil patch is in a slump — and say they will be pushing for modifications to the regulations.

When it comes to the regulations, the government has put water in its wine before. Implementation has been delayed for three years now that U.S. President Donald Trump signed an executive order to reconsider methane cuts in the United States.

DEFICITS

The government’s preliminary fiscal numbers are out for 2016-17, and it looks like the Liberals have run up a deficit of $21.8 billion for the year. That’s a bit smaller than initially forecast — with the big caveat that end-of-year adjustments could change the final numbers when they are published in the fall.

The deficit comes mainly from an 8.2 per cent increase in spending compared to the previous year, attributable in part to fulfilling an election promise to increase child benefits, plus more benefits for a growing number of seniors and more employment insurance payouts.

But direct program expenses grew by 9.1 per cent, not much of which can be attributed to the Liberals’ vaunted infrastructure program, which will start growing this fiscal year. Rather, spending increased in a smattering of different government departments, such as Employment and Social Development and Indigenous and Northern Affairs.

The numbers are important because they are for the first full fiscal year completely under the purview of the Trudeau Liberals. And as the Conservatives choose a new leader, the one thing all candidates and their supporters agree on is that the deficit is too big.

Expect the new leader’s team to take a magnifying glass to the numbers.

SORTING OUT THE CIVIL SERVICE

What was once a problem that was painful to civil servants but seemed to have only a limited effect on the broader population has now become an expensive mess that refuses to go away.

The Phoenix pay system is so bogged down in bugs that the government announced this week it will spend $142 million over two years to hire 200 extra people — on top of 300 working on the system so far.

That brings the total cost overruns to $402 million, for a project that was only supposed to cost $300 million in the first place and was intended to pay for itself and save the government money over time.

Government unions are upset, MPs are hearing many complaints about poor management and there is much finger-pointing all around. The Liberals blame the Conservatives for cutting government capacity to handle the new system.

Heather Scoffield, Ottawa Bureau Chief, The Canadian Press

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