Trump’s Alaska Oil and Gas Lease Auction Draws Just Two Bidders

v0jqs8se7cqim5]fa(v(i40j_media_dl_1.png Source: Alaska Department of Nat

Article content

(Bloomberg) — Only two bidders participated in the Trump administration’s auction for drilling leases in Alaska’s Arctic National Wildlife Refuge as big oil companies sat out the sale. 

Article content

The Alaska Industrial Development and Export Authority, a state agency, and Anchorage-based Hex Energy were the sole entrants in the auction for nearly 690,000 acres of oil and gas drilling rights. It was the Interior Department’s first lease sale in the refuge since lifting drilling restrictions imposed by former President Joe Biden. 

Article content

Article content

Article content

It was a key test of the oil industry’s appetite to drill in the rugged frozen tundra, long prized for its oil and gas potential but burdened by political uncertainty, environmental opposition and logistical challenges.

Article content

Article content

The sale was the first of four lease sales required under President Donald Trump’s tax-and-spending law, the One Big Beautiful Bill Act, which mandates at least four auctions in the area by 2035. It comes as Trump seeks to make tapping Alaska’s vast natural resources a key part of his energy agenda.

Article content

Combined, the Industrial Development and Export Authority and Hex Energy bought leases for five tracts through the sale.  

Article content

Trump signed legislation during his first term ending a four-decade ban on energy development in the refuge, which is estimated to contain as much as 11.8 billion barrels of recoverable oil. The protected area occupies a section of northeastern Alaska roughly the size of South Carolina.

Article content

Major oil companies largely steered clear of the first two lease sales that followed. An auction held weeks before Trump left office in January 2021 drew bids from two oil developers and Alaska’s state-owned economic development company. A second sale in January 2025 under the Biden administration resulted in zero bids, though oil industry representatives and Alaska officials argued restrictive lease terms artificially discouraged interest. 

Article content

Article content

Some analysts are skeptical about the prospects for drilling in the region. 

Article content

“Production will be challenging, and the prospect that permits will be canceled as soon as a new administration takes over is likely given that this is an easy way for a new administration to make a show of its environmental commitment,” said Ellen Wald, a senior fellow with the Atlantic Council Global Energy Center and the president of Transversal Consulting.

Article content

Still, a March lease sale in the National Petroleum Reserve in Alaska drew a record $163 million in bids from established operators like ConocoPhillips, as well as companies such as Exxon Mobil Corp., which last drilled an exploratory well in the state in the early 1990s. Shell Plc, which abandoned Arctic exploration after a costly unsuccessful search for crude waters north of Alaska, partnered with Repsol SA to secure over 40 leases. 

Article content

Environmental groups and some indigenous communities, including Gwich’in, which consider the coastal plain sacred, argue drilling threatens Arctic foxes, polar bears, caribou, musk oxen and migratory birds.