In an interview published in this week’s Petroleum News (“Wielechowski remains critical of HB 110“), Senator Bill Wielechowski argues that, under their state oil & gas leases, producers are required to undertake additional drilling when they can make a “reasonable profit.” (“I think you need to look at the legal obligation the companies incur when they take out a lease. Their obligations require them to develop the lease when they can make a reasonable profit.”).
This repeats an argument I first heard the Senator make repeatedly at a debate earlier this month with Senator Cathy Giessel and which he then repeated in a subsequent, extended exchange on Facebook following that debate. (“The leases … say they must produce, drill, develop when they can make a reasonable profit.”)
The problem? The leases which cover the vast majority of the existing North Slope fields don’t say what Senator Wielechowski says they do. Continue reading