 But ANWR Greater Economic Promise Of Major Oil Deposits May 25, 2002
 Graphic provided by USGS - Click on graphic for larger photo...
"But the report also proves that ANWR is a far better source of oil. Development in the coastal plain would be far more concentrated, likely improving the economics and certainly lessening the environmental impacts. The report builds the case for energy development in both ANWR and NPRA," said Murkowski. The new report predicts that the 23.3-million acres of the NPRA contains between 6.7 and 15 billion barrels of technically recoverable oil -- the mean estimate being of 10.6 billion barrels available. That is similar to predictions from the 1.5 million acres of the coastal plain where 5.7 to 16 billion barrels are predicted to be technically recoverable. But given the huge area of NPRA -- 15 times larger than the coastal plain -- the oil is expected to be far less economic. The report predicts that just 620 barrels per acre will be found in NPRA, compared to 8,400 in ANWR, making the fields far less economic. For example, at $25 per barrel prices, the report predicts that only 3.7 billion barrels are recoverable from NPRA, compared to 5.8 billion from ANWR (based on the mean predictions). Only at $40 per barrel long-term prices could NPRA produce more oil than ANWR, according to the USGS report. The report also estimates that NPRA contains between 39.1 and 83.2 trillion cubic feet of natural gas, with a mean value of 59.7 tcf -- a very large supply of natural gas. Murkowski said the finding highlights the need of Congress to provide incentives for the construction of an Alaska natural gas pipeline system. Such a pipeline would bring NPRA and other North Slope gas to market. The Senator last month won in the Senate energy bill a safety net that provides tax incentives to gas producers if the price of gas falls below that needed to finance the $19.4 billion gas line -- a tax break that would be fully repaid to taxpayers when gas prices rise above minimum levels. Murkowski observed that the new report ignores environmental issues. Environmentalists already have pressed to close a large part of the Northeast corner of the petroleum reserve to oil exploration because of environmental concerns for waterfowl. He said he expects environmentalists might also press against leasing in other parts of the preserve. The preserve is home to the 450,000-member Western Arctic caribou herd and the 25,000-member Teshekpuk caribou herd. Murkowski warned that any comparison of NPRA versus ANWR oil potential ignores the fact that the USGS estimates for ANWR may be markedly understated. USGS estimates for ANWR assume no production from the area at Marsh Creek Anticline, which some geologists believe could be another Prudhoe Bay-sized oil field. "Some will mistakenly say we don't need oil from the coastal plain since NPRA, theoretically, is open for development. We need to press for additional oil and gas lease sales in NPRA and I support new efforts to open other parts of the reserve for exploration and leasing," said Murkowski. "But what this report really shows is that given our 59 percent dependence on foreign oil, we should be working to open both the tiny area of ANWR and some of the far larger areas of NPRA to oil and gas development. Opening both would truly help reduce our dependence on foreign oil and guarantee America access to the 80+ tcf of natural gas in NPRA and the additional 29 tcf already proven at Prudhoe Bay," Murkowski said. "It would protect our national security, promote our energy independence, increase the likelihood of a natural gas pipeline project, guarantee continued operation of the trans-Alaska oil pipeline, and fuel jobs and revenue for the U.S. Treasury and for Alaskans for generations to come," said Murkowski.
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