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Alaska's Economy Takes A Hit With Shell's Decision To Halt Drilling
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Alaska's Economy Takes A Hit With Shell's Decision To Halt Drilling

Energy

Alaska's Economy Takes A Hit With Shell's Decision To Halt Drilling

Alaska's Economy Takes A Hit With Shell's Decision To Halt Drilling
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Alaska's economy depends heavily on oil for jobs and tax revenues. Shell's decision to halt oil and gas exploration off the state's northern coast is a "huge disappointment," the governor says.

STEVE INSKEEP, HOST:

Now Shell's announcement prompted a range of reactions in Alaska. Rachel Waldholz of Alaska Public Media reports.

RACHEL WALDHOLZ, BYLINE: Alaska Gov. Bill Walker is calling Shell's announcement, a huge disappointment. And he says the end of Shell's offshore dreams means the state must push harder for the federal government to allow drilling in another controversial region - the Arctic National Wildlife Refuge.

(SOUNDBITE OF ARCHIVED RECORDING)

BILL WALKER: We need to get some oil in the pipeline, and we need to do it as quickly as possible. If it's not going to come from offshore, let's safely develop it from onshore.

WALDHOLZ: Alaska depends on oil for the vast majority of state revenue. It's been hit hard, not only by plummeting oil prices but by declining production. That has meant less oil flowing through the Trans-Alaska Pipeline. The Native Alaskan Arctic Slope Regional Corporation is also expressing frustration. In a written statement, President Rex Rock says that without more oil and gas development, communities in the region face a fiscal crisis beyond measure and blames federal regulators for Shell's decision. But for others...

ROSEMARY AHTUANGARUAK: People were relieved. There was jubilation.

WALDHOLZ: Rosemary Ahtuangaruak lives in remote Barrow, Alaska. The city is in the middle of its fall-subsistence whale hunt. Shell's exploration was just 150 miles away. Speaking with her grandchildren playing in the background, Ahtuangaruak says it's crucial to protect the environment and their Alaskan Native way of life for the next generation.

AHTUANGARUAK: We're not prepared. We didn't have enough infrastructure and resources to be able to respond to an adverse event.

WALDHOLZ: She says on paper, there's a plan to deal with any spill.

AHTUANGARUAK: But the reality of trying to work in our harsh environment, there is no proven method to respond to an adverse event of a spill.

WALDHOLZ: Shell's project would have opened up an entirely new area to drilling. Lois Epstein of The Wilderness Society says that would have had long-term repercussions well outside the region.

LOIS EPSTEIN: Once you invest in the infrastructure to do that, we are going to be relying on fossil fuels for that much longer.

WALDHOLZ: Meanwhile, Shell still needs to cap and seal the exploratory well and move its drilling rigs and dozens of support vessels out of the Arctic before the arrival of winter sea ice. For NPR News, I'm Rachel Waldholz in Fairbanks.

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