What is ANWR’s Economic Potential?

What is ANWR’s Economic Potential?

April 30, 2019

Much has been made about the status of potential lease sales later this year for lands in Alaska’s Arctic National Wildlife Refuge.  The Department of Interior’s Bureau of Land Management held public hearings earlier this year on their draft environmental impact statement (DEIS), with a goal to hold the first lease sales late in 2019 or early 2020.

With environmental extremists across the US demanding ANWR development be put on hold, due to their belief that extracting oil and gas from the refuge would harm the Porcupine Caribou herd, it might be a good time to review what development in ANWR could mean for the US and Alaska economies.

A December 2017 article in the Anchorage Daily News quoted US Senator Lisa Murkowski, who spoke about the royalty split between state and federal government, noting:

“Murkowski, chair of the Senate Energy and Natural Resources Committee, said the refuge’s primary value to the federal treasury won’t come from lease sales. Instead, royalties are critical, she said. If Murkowski’s measure is approved, and all the economic oil is produced, the 16.67 percent royalty rate would bring in about $100 billion for the state and federal government to split, at today’s prices.”

Then-Commissioner of Alaska’s Department of Natural Resources, Andy Mack, also noted the economic potential for lease sales, as well as ongoing royalties.

“Andy Mack, Alaska Natural Resources commissioner, said earlier lease sales of wide-open lands have been tremendous in Alaska. The 2008 Chukchi Sea sale in federal waters generated $2.7 billion in high bids. The 1969 Prudhoe Bay lease sale generated $900 million. One relatively small field in ANWR producing 100,000 barrels daily could earn Alaska close to $200 million in annual royalties, at today’s prices, he said. State and local taxes would add more money.”

In addition to ongoing revenues, Alaska’s Resource Development Council reports that Alaska Outer Continental Shelf (OCS) and ANWR development could bring nearly 55,000 annual jobs to Alaska, and Arctic Power notes that “[d]evelopment of oil reserves in the Coastal Plain of the Arctic National Wildlife Refuge could create as many as 736,000 new domestic US jobs, according to an economic analysis by Wharton Econometrics Forecasting Associates.”

Power The Future continues to back efforts to open ANWR to responsible development. The job numbers alone should be more than enough to warrant development – it could revitalize Alaska and position its economy for the future. We call on the environmental extremists who are fighting the project to stop, as the Arctic National Wildlife Refuge is a key part to continued American energy dominance and oil independence.