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Governor Parnell Budgets Road to Resources

December 8, 2009, Juneau, Alaska - Governor Sean Parnell today announced an aggressive transportation plan to build a road to Umiat to connect to known and prospective oil and gas resources from the Dalton Highway. The project will assure year-round access to the Umiat oil field and the Gubik gas complex, and will put seasonal equipment at the doorstep of the National Petroleum Reserve-Alaska (NPR-A).

"Getting this road built will significantly lower costs for the explorers and will likely speed up production of the first gas and oil from the region," Governor Parnell said. "Development of these fields will provide jobs for Alaskans and revenue for the state."

Governor Parnell's budget for Fiscal Year 2011 will include $8 million for the Department of Transportation and Public Facilities to aggressively pursue permitting to build the road.

The road will stretch west from the Dalton Highway to the North Slope foothills, Umiat, and eventually NPR-A. Oil and gas in the North Slope foothills have been a matter of speculation for explorers and Alaskans since pools of oil were seen on the surface decades ago. Until now, the lack of transportation infrastructure has limited exploration. Transportation can amount to 40 percent of all exploration costs.  

Just 15 miles past the North Slope foothills, the road would hit the light, sweet oil deposits at Umiat, where the main reservoir holds about 250 million barrels of economically recoverable oil, with the potential for hundreds of millions more in place.

The road could eventually expand to NPR-A, which holds an estimated 12 billion barrels of oil and 73 trillion cubic feet of natural gas.

"Transportation costs limit access and impede development," Governor Parnell said. "We're going to change that and get more private sector jobs in the process."



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