CFP: Way back in 1980, Congress passed the Alaska National Interest Lands Conservation Act, establishing the Arctic National Wildlife Refuge and making numerous other land use decisions for our 49th state. Section 1002 of the act postponed a decision on managing ANWR’s 1.5-million-acre coastal plain, which has enormous oil and gas potential and is important summertime wildlife habitat.
For four decades, environmentalists blocked legislation that would have opened the coastal plain to leasing and drilling. In 1995 President Clinton vetoed a pro-drilling bill that had passed both houses.
After the IRS, oil company oil and gas royalty payments represent the single largest contribution to the U.S. treasury
At long last, the tax-cut legislation just passed by Congress allows America to benefit from the petroleum resources that experts predict will be found in a small section of the plain, along Alaska’s northern coast. The legislation directs the Interior Department to hold at least two lease sales over the next 10 years, for a maximum of 2,000 acres opened to drilling. Analysts say the sales could fetch as much as $2.2 billion.
The area contains an estimated 10.4 billion barrels of oil, says Alaska Senator Lisa Murkowski, chair of the Senate Energy and Natural Resources Committee. Others put the petroleum potential even higher.
The U.S. Geological Survey and Congressional Research Service say it’s 95% likely that there are 15.6 billion barrels of oil beneath ANWR. With today’s exploration, drilling, fracking and other technology, up to 60% of that may ultimately be recoverable.
At $50 a barrel, that represents $460 billion that the USA would not have to send overseas; tens of billions in Alaskan and United States royalty and tax revenues; and thousands of jobs in oilfield, manufacturing and many other sectors.
After the IRS, oil company oil and gas royalty payments represent the single largest contribution to the U.S. treasury. Companies that produce from federal onshore and offshore leases pay royalties of up to 18% of wellhead prices, and then pay corporate taxes on profits and sales taxes at the pump. Workers pay income taxes, instead of receiving unemployment and welfare checks.
Every step in the leasing, drilling, production and pipeline process will require extensive environmental reviews. Unfortunately, each step will likely generate lawsuits and delays.
Alaska alone has 57 million acres (more than all of Utah) set aside as wilderness
As they have since long before 1980, activists continue to claim that any drilling would destroy the entire ANWR area’s wilderness character and threaten its caribou, polar bears, birds and other wildlife. In all too typical hyperbole, League of Conservation Voters president Gene Karpinski claimed the tax law provision will “turn one of our last remaining wild places into an industrial oilfield.” That’s absurd. read more