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Sen. Murkowski: Tapping ANWR Improves Energy Security and Reduces Deficit

WASHINGTON, D.C. - U.S. Sen. Lisa Murkowski, R-Alaska, today introduced two pieces of legislation to increase domestic oil production by tapping the energy reserves in the coastal plain of the Arctic National Wildlife Refuge (ANWR).

"Now is the time to develop our domestic oil reserves in the ANWR coastal plain," Murkowski said. "For far too long, we've kept resources under lock and key that could improve our energy security and create badly-needed jobs. There's no excuse for continuing to pay foreign countries for resources we have here."

The American Energy Independence and Security Act would provide the most efficient development of ANWR's resources by allowing exploration and production within the coastal plain of ANWR. The legislation would require the Secretary of the Interior to lease at least 200,000 acres of the 1.5 million-acre coastal plain within two years of its passage. Infrastructure - including all roads, airfields, drilling pads, pipelines and other facilities - would be restricted to 2,000 acres to minimize environmental impact on the region. Revenue from ANWR oil production would be divided between environmental mitigation and federal deficit reduction. The bill would also dedicate a portion of ANWR revenues to fund renewable and alternative energy development, wildlife and fishery habitat programs, energy conservation and low-income energy subsidies.

In the spirit of compromise, Murkowski also introduced an ANWR alternative bill, the No Surface Occupancy Western Arctic Coastal Plain Domestic Energy Security Act, which would allow oil and natural gas production from the ANWR coastal plain only through the use of directional drilling from state lands adjacent to the refuge.

"While this compromise is not my first choice, I believe it's a reasonable alternative that should silence any potential controversy over ANWR development," Murkowski said. "It allows us to increase domestic oil production without the same risk of environmental impact, making it a commonsense solution that everyone should be able to embrace."

Domestic oil production has been safely occurring in Alaska's Arctic for more than 30 years. Today, Alaska's North Slope produces roughly 13 percent of the U.S. domestic production. New production is vital to the continued operation of the trans-Alaska pipeline, which delivers Alaska's oil to the Lower 48.

The ANWR coastal plain holds America's greatest potential for a major oil and natural gas discovery. The U.S. Geological Survey estimates the coastal plain has a 50 percent chance of containing 10.4 billion barrels of oil and 8.6 trillion cubic feet of natural gas. Even the recent oil discoveries in North Dakota pale in comparison to ANWR's potential, which is likely to hold over four times more oil than any other onshore energy deposit in North America. ANWR's oil reserves are worth $1 trillion at today's oil prices of $100 a barrel.

"America will continue to use substantial amounts of oil for decades to come," Murkowski said. "The more of that oil we can produce domestically, the better off our economy, our trade deficit, our employment levels and the world's environment will be."

An ANWR fact sheet follow, along with a link to our website for the full text of both bills.

PREPARED BY THE SENATE ENERGY COMMITTEE - REPUBLICAN STAFF
Oil and Gas Leasing in the Arctic National Wildlife Refuge

Background and Impacts

Background on ANWR

·         In 1980, President Carter and Congress set aside 1.5 million acres on the North Slope of ANWR for potential oil and gas development (called the 1002 Area).  This area is not designated wilderness and contains no trees, deepwater lakes, or mountain peaks.

·         ANWR's total acreage is 19 million acres; 1002 Area's total acreage is 1.5 million acres.

·         The surface area that would be covered by production or support facilities is limited to 2,000 acres, or 0.01 percent of ANWR's total acreage.

How much oil does ANWR contain?

·         In 1998, the U.S. Geological Survey estimated that there were between 5.7 billion and 16.0 billion barrels of technically-recoverable oil in ANWR, with a mean estimate of 10.4 billion barrels. This calculation assumed a market price of $30 per barrel of oil. With today's oil prices, as well as improvements in technology, recoverable reserves would be much higher.

·         At a rate of an estimated 1 million barrels per day, ANWR's reserves could produce oil for our nation for more than 28 years.  If production began tomorrow, the oil reserves beneath the coastal plain would last through 2039.    

How would ANWR impact domestic production?

  • U.S. oil production has steadily declined since 1970, when it was nearly 10 million barrels per day, to 5.4 million barrels per day in 2009.
  • The U.S. consumed an average of 18.8 million barrels of oil per day in 2009, and the EIA projects that total U.S. liquid fuels consumption will increase to 22 million barrels per day by 2035.
  • Production in ANWR is projected to average 1 million barrels per day, which would increase domestic oil production by nearly 20 percent for nearly 30 years.
How would ANWR impact oil imports?

  • In 1973, the U.S. imported 6 million barrels of oil per day, or 34.8 percent of its total supply. By 2009, these numbers had grown significantly: the U.S. imported 11.7 million barrels of oil per day, or 51 percent of our total oil used.
  • The EIA projects that domestic oil imports will be 10 million barrels per day in 2035. ANWR production of 1 million barrels of oil per day would reduce this dependence by 9 percent.
How would ANWR impact the American economy?

  • Oil and gas development in ANWR would create thousands of jobs in America, and contribute billions of dollars to our economy. These benefits would directly benefit all 50 states - not just Alaska.
  • According to the EIA, the U.S. spent more than $337 billion to import oil in 2010. ANWR production would help stem this unprecedented transfer of wealth by keeping hundreds of billions of dollars in our economy.
  • In December 2010, America's trade deficit was $40.6 billion. Petroleum related imports accounted for $25.3 billion, or 62 percent of that total. By reducing oil imports by approximately 30 million barrels per month, ANWR production would reduce that deficit and help stabilize our balance of trade.
  • IFC International, Inc. estimates that resource development in ANWR would create between 62,420 and 71,801 jobs in America.
  • In 2002, an EIA study estimated ANWR could contribute up to $350 billion to the U.S. economy. In December 2007, the Congressional Research Service estimated that federal revenues from ANWR development could total $152.9 billion if the price of oil stays at $100 per barrel.


Visit our website at http://energy.senate.gov/public/



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