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Interior Secretary Sally Jewell said Friday that companies can continue to mine coal reserves already under lease.
The Interior Department last month said it plans to cancel the 6,200-acre lease. It was granted in 1982 on land considered sacred to the Blackfoot tribes of the U.S. and Canada.
Lower oil prices this year have pared back the royalty revenue that government treasuries and Native American tribes get for production on federal land.
Tribal leaders said such a move would make up for a wrong done to them in 1982, when the government issued the lease without consulting the tribes.
The company says it’s walking away from oil exploration in U.S. Arctic waters for the “foreseeable future,” but it’s keeping its options open.
The Obama administration has telegraphed its plans to “reduce wasteful venting, flaring and leaks of natural gas from onshore wells” on federal and Indian leases nationwide.
The Interior Department announced it was canceling government auctions of drilling rights in the Chukchi and Beaufort seas, previously scheduled for 2016 and 2017 respectively. At the same time, it formally rejected bids by Statoil and Shell for more time to search for crude under their existing Arctic leases.
After failing to find commercially viable quantities of oil and gas at its Chukchi Sea well, Shell said it will halt exploring U.S. Arctic waters and could take a $4.1 billion write down.
The move by the Interior Department’s Bureau of Ocean Energy Management is designed to ensure that the companies have set aside enough money to dismantle offshore facilities once oil and gas stops flowing.
A plan to curb natural gas venting and flaring at wells on public land is now being scrutinized in an interagency review process, teeing the proposal up for possible release later this year.