OREANDA-NEWS. November 21, 2016. President Barack Obama's administration has dropped earlier plans to open new arctic waters to oil and gas drilling in a policy reversal that industry groups hope president-elect Donald Trump will target after taking office.

The US Bureau of Ocean Energy Management (BOEM) today canceled two lease sales it had proposed for acreage in the Beaufort and Chukchi seas because of lingering concerns about the effect drilling could have on the sensitive environment. The agency adopted the change through a final plan that schedules offshore oil and gas lease sales between 2017 and 2022.

The withdrawal of arctic waters from the plan has further inflamed industry groups that opposed the administration's decision this year keep the Atlantic off-limits to oil and gas drilling. BOEM in a draft plan had proposed holding one lease sale in the Atlantic but abandoned the idea in the face of push back from environmentalists and coastal communities.

US Interior secretary Sally Jewell said the administration decided to focus the five-year offshore leasing plan on areas with the highest resource potential, lowest conflict and established oil and gas infrastructure.

"Given the unique and challenging arctic environment and industry's declining interest in the area, forgoing lease sales in the arctic is the right path forward," Jewell said.

The final leasing plan retains twice-a-year lease sales for the entire US Gulf of Mexico and one lease sale for acreage in the Cook Inlet, an area off the southern coast of Alaska that is hundreds of miles away from the arctic. But oil and gas groups denounced the decision as another example of the administration trying to limit fossil fuel production.

"The arrogance of the decision is unfathomable but unfortunately not surprising," said National Ocean Industries Association president Randall Luthi, who said withdrawing the arctic sales was short-sighted and would threaten US energy security.

Shell and other oil producers that owned federal oil and gas leases in arctic waters pulled out of the region last year, after attempts to drill exploratory wells were unsuccessful. Low crude prices and regulatory uncertainty made it difficult to justify further costly investments needed to drill in the arctic, those companies said.

But the oil and gas industry says that the arctic could become attractive again with higher crude prices and a more accommodating regulatory environment. Shell in particularly complained that its \\$7bn investment in the arctic was stymied repeatedly by the Obama administration because of permitting delays and restrictions on drilling wells.

Oil and gas groups hope the incoming administration will look more favorably on oil and gas development in the region, based on campaign speeches where Trump has promised to open more regions to oil and gas development. The next administration could try to modify the leasing plan after taking office on 20 January.

"People across Alaska will be looking to the Trump administration to quickly tear up the lease plan and implement an entirely new schedule, which includes the arctic and helps secure the state's future," said industry group the Arctic Energy Center.

The Trump administration did not respond for comment.

Democratic lawmakers and environmentalists applauded the decision, which came after early reports suggested the Obama administration was planning to retain one of the scheduled arctic lease sales. It remains unclear if the unexpected election of Trump had any impact on the final decision.

BOEM has previously estimated the Chukchi sea holds 15bn bl of oil and 77 Tcf of natural gas that is technically recoverable, more than any other area outside of the central Gulf. The agency estimates the Beaufort sea holds 8bn bl of technically recoverable oil and 27 Tcf of technically recoverable natural gas.