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Oil rights generate record $2.7 billion

Feb. 7, 2008 at 1:05 PM   |   Comments

ANCHORAGE, Alaska, Feb. 7 (UPI) -- Drilling rights in the Chukchi Sea northwest of Alaska generated a record $2.7 billion the U.S. Interior Department's Mineral Management Service said Thursday.

It is the most money generated by an oil and gas lease auction, the Anchorage (Alaska) Daily News reported.

The highest bidding came from Dutch company Shell, which bid more than $2.1 billion for various tracts, its highest single bid topping $105 million.

Conoco Phillips was a distant second in the bidding with offers totaling $506 million.

"It's a great sale, a great commitment," said Randall Luthi, director of the Minerals Management Service, offering his belief that production in the Chukchi Sea would reduce the U.S. demand for imported oil.

As the lease locations are all beyond Alaska's jurisdiction, the state doesn't stand to benefit from the sale. The $2.7 billion goes to the federal government.

Environmental groups and Native Alaskans, concerned about possible oil spills, stood outside a library in Anchorage when the bids were opened to protest the sale.

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