In Alaska area, fear, not favor, greets offshore drilling talk

BARROW, Alaska — House by weather-beaten house, it's almost possible to count votes by driving the gravel streets and tallying up the campaign signs in this town on the edge of the Arctic Ocean.

The campaign signs — tacked to buildings because the permafrost is too mucky in late summer to sink in a yard stake — are better indicators of allegiance than even the most scientific of polls. Yet they signal far more than just a vote for the mayoral candidate who will best fix the potholes and chase the polar bears from the high school football field.

Offshore in the Beaufort and Chukchi seas, oil companies, chiefly Royal Dutch Shell, have paid billions of dollars to explore reserves that could rival the oil and gas discoveries of the Gulf of Mexico. Whoever wins the nonpartisan Oct. 7 election for mayor of the North Slope Borough will shape the future of offshore drilling in the nation's arctic waters — as well as that of a village where ancient whaling traditions still dominate daily life.

"The oil industry, if I don't win this election, I think they'll be jumping up and down for joy," said Edward Itta, 63, the current mayor and an opponent of offshore drilling. He faces a challenge from his former boss and the village's previous five-term mayor, George Ahmaogak. Both men are whaling captains.

"The oil industry has been the lifeblood of the economy up here. The North Slope Borough is pro-development," Itta said. "But offshore . . . now that is totally different."

Worried that noise from oil exploration and, ultimately, drilling will drive off the bowhead whales hunted by the Inupiat Eskimos of the North Slope, Itta's administration, in concert with several environmental groups, sued the Minerals Management Service, the agency that oversees oil and gas leases in federal waters. So far, the unresolved lawsuit has succeeded mostly in slowing the company's exploration. Shell has continued to conduct seismic surveys, including offshore work this summer, but the lawsuit has kept the company from drilling exploratory wells.

Ahmaogak says he, too, opposes offshore oil-and-gas development, but he also thinks that national-security interests make it inevitable.

"The federal government is pushing forward with leasing no matter whether we object to it," said Ahmaogak, 59. "I'm not saying I'm in bed with the industry, it's simply that I've got a job to do protecting subsistence resources, protecting whaling. The mayor's office should be right there, and they're not."

The North Slope Borough, the equivalent to a county in most U.S. states, covers the largest area of any municipal-type government in the country. The sprawling territory north of the Arctic Circle, bigger than all but nine states at 89,000 square miles, is home to 6,600 people. Some 70 percent are Alaska Natives. Most people are clustered in Barrow, a coastal village northwest of the borough's tax base and wealth: the Prudhoe Bay oilfields.

Whaling is so important to the community that the borough's wildlife department employs scientists to research the bowhead whales and other marine mammals that have fed, clothed and even sheltered the people who have long inhabited the coastline.

Shell has been paying attention. One of its top executives, Marvin Odum, has been on a whaling expedition with crews from Barrow. The company signed a conflict-avoidance agreement pledging to avoid interfering with traditional subsistence hunts. It spent millions helping the community upgrade its communications system so that whalers and the oil company can share any potential conflicts as well safety alerts.

Shell has also poured thousands of dollars into other projects, including $250,000 for an Inupiat language program at the local college, said the company's spokesman in Alaska, Curtis Smith.

Shell's time in the community doesn't just demonstrate respect to North Slope stakeholders, Smith said, but it also "frames, for our Shell leadership, the importance of a centuries-old subsistence lifestyle and the concerns that some residents have about offshore development."

Many feel the company still has some work to do.

"We as a people are asked to take all the risk for no major financial return," Itta said. "The stress and anxiety that gives us as a people . . . we don't even know what to expect. Nobody has ever done this up here. We don't want to learn the hard way."

Many in the borough would at least like Shell to slow down and fully examine the potential impacts, said Robert Suydam, one of the senior scientists for the borough and an expert on bowhead whales.

"It's inevitable that oil companies are going to move offshore," Suydam said. "Our job is to make sure what decisions the federal government makes and the oil companies make are the best possible. We're trying hard to make sure there aren't risks."

By far, the biggest concern is oil spills. No oil company has been able to prove conclusively that they have effective methods to contain spills. For Alaskans who remember the lingering psychological, economic and environmental effects of the 1989 Exxon Valdez spill, it is an important consideration.

"We haven't seen that they have the capability to clean up oil in ice-infested waters," Brower said. "They haven't proven that ever in open water."

The borough has long supported drilling in the Arctic National Wildlife Refuge, where it would be able to tax the infrastructure. But offshore drilling in the federal waters off Alaska has no guarantee of revenue sharing with local or state governments, and it's unclear yet whether Shell will have onshore infrastructure.

Both Itta and Ahmaogak understand fully how important the oil is to their future — Itta got his start 40 years ago as an oilfield roustabout in Prudhoe Bay and until recently, Ahmaogak worked for Shell. But it's clear they will have very different approaches to what happens next with offshore drilling.

"I understand that we are at a critical time and I will work to my death to protect our way of life up here," Itta said. "As an Inupiat people, we were here before oil and we must work so that we are here after oil."

When Ahmaogak's last term as mayor ended in 2005, he went to work for Shell as a community-affairs manager, a job he left six months ago to run for mayor. His time with the oil giant exposed him to "first-rate" management, Ahmaogak said. He brushes off criticism he is too close to the industry to be an independent advocate for the borough.

"I'm not bought off by the oil industry," he said. "I don't have any collaboration at this point with the oil and gas industry."

But he does have complicated loyalties. His wife, Maggie Ahmaogak, was fired as the executive director of the Alaska Eskimo Whaling Commission after a dispute over her potential conflicts. Now she works for an offshoot of the Arctic Slope Regional Corp., an Alaska Native-owned corporation that is actively bidding on offshore support contracts.

For its part, Shell has been fastidious about staying out of the mayoral election, said Smith, who previously worked as a spokesman for Sarah Palin during her 2006 bid for governor. Palin, who's now the Republican vice-presidential nominee, is a supporter of offshore drilling.

"We're not involved at all," Smith said. "No matter who is mayor, Shell expects to be treated the same as any company that has a relationship with the North Slope Borough. Whoever's chosen as mayor, their job will be to represent the people of the North Slope communities, not Shell."


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