Arctic Development

It’s estimated that 90 billion barrels of undiscovered, technically recoverable oil and 44 billion barrels of natural gas liquids reside in the Arctic. In total, this Arctic potential represents 22% of the Earth’s undiscovered oil and natural gas. In America’s Arctic waters, the U.S. government conservatively estimates 26 billion barrels of oil in the Chukchi and Beaufort Seas alone. Recent economic assessments have estimated the job potential from these prospects would create almost 55,000 yearly jobs across the US over the next fifty years.

The following reports and studies give greater insight to the prospects and opportunities from Arctic offshore exploration and development.

Economic Development

Arctic Promise: Challenges and Opportunities in Realizing the Next Generation of U.S. Arctic Infrastructure
Arctic offshore oil and gas activity – if allowed – would bring sufficient physical and financial resources to the region to support these major infrastructure investments, plus an estimated $19 billion in state and local revenues.
Alliance for Innovation and Infrastructure

Offshore Alaska – The Next Frontier (2015)
The Alaska Outer Continental Shelf (AOCS) could contain several billion barrels of oil, and given Shell’s position as the largest acreage holder in the area it could eventually provide the company with up to 500kb/d of production – a meaningful contribution. Commercially, we see the decision to drill as sensible given the investment already made, but we identify two further important criteria to be met.
Barclays

Solving the oil independence problem: Is it possible? (2015)
As currently discussed in political circles, oil independence is unattainable—lacking coherent meaning and wedding policymakers to the notion that they can never accomplish it. Contrary to this thinking, more than a dozen different sets of technologies and practices could increase domestic supply and reduce demand for oil to the point of making the US functionally independent from oil price shocks. However, achieving this goal demands concerted action to expand and diversify conventional domestic oil supplies, reduce overall demand in the transportation and buildings sector, and continue to develop alternative fuels. If policymakers undertook such actions today, the US could become oil independent by 2030.
Virginia Polytechnic Institute and State University, VA

Potential National-Level Benefits of Alaska OCS Development (2011)
This study quantifies these other economic benefits beyond Alaska, focusing on estimated government take and employment effects on the rest of the nation. This follow-up study only considers development in the Beaufort Sea and the Chukchi Sea OCS; no activity is anticipated in the North Aleutian Basin. On March 3, 2010, the Secretary of the Interior Ken Salazar announced that as part of the Obama Administration’s plan for the protection of special areas like the Bristol Bay in Alaska, the planning area (North Aleutian Basin) would be withdrawn from consideration for oil and gas development through 2017
Northern Economics Inc. & Institute of Social and Economic Research, University of Alaska

Impact of OCS Development on the Alaska Economy (2011)
Prepared written testimony by Oliver Scott Goldsmith, Professor of Economics.
Institute of Social and Economic Research University of Alaska Anchorage

Alaska after Prudhoe Bay: Prospects for the Economy (2009)
This presentation shows how oil has transformed the Alaskan economy for the better.
PPT PRESENTATION Institute of Social and Economic Research- University of Alaska-Anchorage

Economic Analysis of Future Offshore Oil and Gas Development: Beaufort Sea, Chukchi Sea, and North Aleutian Basin (2009)
This study describes and quantifies the potential economic benefits to the State of Alaska and local communities from developing oil and gas resources in Alaska’s Outer Continental Shelf (OCS) areas. The findings of this study are not predictions of the future for Alaska, but rather they describe a reasonable approach that one might expect for OCS development. The findings also provide a basis for thinking about potential actions that state and local governments, industry, and other stakeholders might undertake to deal most effectively with the effects that do occur.
Northern Economics Inc. & Institute of Social and Economic Research, University of Alaska

Oil and Gas Development in the Arctic: Softening of Ice Demands Hardening of International Law (2009)
The existing soft law arrangements for the Arctic and the international agreements and principles pertaining to the Arctic do not provide sufficient protection for the Arctic marine environment from the adverse impacts of new oil and gas exploration and exploitation. A better approach for the Arctic coastal states is to develop a regional legally binding agreement that regulates oil and gas development on the Arctic coastal states’ continental shelves. The Arctic is facing a complete meltdown—new pressures demand a new agreement.
University of New Mexico

What Drives The Alaska Economy? (2008)
This summary reports that the driver behind Alaska’s economy is new money: money coming in from outside the state. How big the economy is, and how much it grows, depends on how much new money comes in. The petroleum industry accounts for 31% of Alaska’s economy.
Institute of Social and Economic Research- University of Alaska, Anchorage

The Economics of Allowing More Domestic Oil Drilling (2008)
This paper examines the likely impact of developing new energy resources on oil and gasoline prices. In addition, we use a benefit-cost framework to analyze the impact of allowing oil drilling in the Arctic National Wildlife Refuge and the portions of the Outer Continental Shelf that are currently closed to development. The benefit-cost analysis of developing off-limits OCS suggests that the benefits are very likely to exceed the costs.
Milken Institute

Inupiat Health and Proposed Alaskan Oil Development: Results of the First Integrated Health Impact Assessment/ Environmental Impact Statement for Proposed Oil Development on Alaska’s North Slope (2007)
This report describes on the first Health Impact Assessment (HIA) for proposed oil and gas development in Alaska’s North Slope region. Public health is not generally analyzed in the Environmental Impact Statement (EIS) process in the U.S. We conducted an HIA for proposed oil development within the National Petroleum Reserve – Alaska in response to growing concerns among North Slope Inupiat communities regarding the potential impacts of regional industrial expansion on their health and culture. Benefits include funding for infrastructure and health care; increased employment and income; and continued funding of existing infrastructure. Based on these findings, a series of public health mitigation measures are recommended.
National Health Policy Forum

The economy of the circumpolar Arctic (2006)
The objective of this report is to present a new and updated analysis of the circumpolar Arctic considered as a whole. Economic activity is unequally distributed among the different Arctic regions; the economic prosperity of the wealthiest regions being based on large-scale exploitation of natural resources.
Arctic Human Development Report

Undiscovered oil resources in the Federal portion of the 1002 Area of the Arctic National Wildlife Refuge: an economic update (2005)
This report updates an economic analysis of the U. S. Geological Survey’s 1998 petroleum assessment of the Federal 1002 Area of the Arctic National Wildlife Refuge. Whereas the 1998 geologic assessment evaluated Federal and Native lands in the 1002 Area and adjacent State waters, the economic analysis published at that time, as well as this update, considered just the Federal part of the 1002 Area. The update includes newer field development practices based on horizontal development wells and alternative area development schemes, as well as an update of the 1996 base costs to a new base year of 2003.
US Geological Survey, US Dept. of the Interior

Infrastructure, safety and environment and National Security Research Division (2003)
A recent study released by the EIA (2008a) concludes that, if ANWR were to be opened up for oil and natural-gas drilling in the near future, oil production would begin in approximately 10 years. During its peak production years in 2025 to 2030, ANWR would likely be capable of providing between 0.5 and 1.5 mbd of production; after 2030, output would be expected to decline as the field would begin to be depleted. The oil contained in ANWR has an estimated value of $374 billion in constant 2005 dollars but would cost approximately $123 billion to extract and bring to market. Of the $251 billion difference, they estimate that approximately $90 billion would benefit the petroleum industry as profit while the remaining $161 billion would flow to the state and federal governments as tax revenue.
Sponsored by the Institute for 21st Century Energy U.S. Chamber of Commerce

Resource Potential

Permafrost-associated natural gas hydrate occurrences on the Alaska North Slope (2011)
In the 1960s Russian scientists made what was then a bold assertion that gas hydrates should occur in abundance in nature. Since this early start, the scientific foundation has been built for the realization that gas hydrates are a global phenomenon, occurring in permafrost regions of the arctic and in deep water portions of most continental margins worldwide. In 1995, the U.S. Geological Survey made the first systematic assessment of the in-place natural gas hydrate resources of the United States. That study suggested that the amount of gas in the gas hydrate accumulations of northern Alaska probably exceeds the volume of known conventional gas resources on the North Slope.
Energy Resources Program, U.S. Geological Survey, Denver Federal Center

Arctic Energy Resources and Global Energy Security (2010)
In recent years the world has become gripped with concerns about climate change and its impact on Arctic ice as well as the perception that increasing global energy consumption might surpass the capacity of energy markets. These seemingly unrelated issues come to a nexus in the Arctic region2 since melting ice coverage has led some analysts to believe that previously inaccessible oil and gas deposits may now be accessible permanently or periodically. Successful development of these reserves would help to alleviate the pressure on the global oil and gas markets and potentially enhance energy security as a result.
Defense Research and Development, Centre for Operational Research and Analysis, Canada

Estimates of Undiscovered Oil and Gas North of the Arctic Circle (2008)
In May 2008 a team of U.S. Geological Survey (USGS) scientists completed an appraisal of possible future additions to world oil and gas reserves from new field discoveries in the Arctic. More than 70 percent of the mean undiscovered oil resources is estimated to occur in five provinces: Arctic Alaska, Amerasia Basin, East Greenland Rift Basins, East Barents Basins, and West Greenland–East Canada. More than 70 percent of the undiscovered natural gas is estimated to occur in three provinces, the West Siberian Basin, the East Barents Basins, and Arctic Alaska.
U.S. Geological Survey

Brookian structural plays in the National Petroleum Reserve (2003), Alaska
As part of the U.S. Geological Survey assessment of undiscovered oil and gas resources in the National Petroleum Reserve-Alaska (NPRA), two structural plays were assessed in thrust-faulted and folded Upper Cretaceous rocks of the Brookian mega-sequence. These are the Brookian Topset Structural Play and the Torok Structural Play, located in the Brooks Range foothills and the southern part of the coastal plain, within the Tertiary-age frontal part of the Jurassic to Tertiary Brooks Range orogenic belt.
US Geological Survey, US Dept. of the Interior

Coalbed methane, Cook Inlet, south-central Alaska: A potential giant gas resource (2003)
Cook Inlet Basin of south-central Alaska is a fore-arc basin containing voluminous Tertiary coal deposits with sufficient methane content to suggest a major coalbed gas resource. A preliminary estimate of 140 tcf gas in place is derived for the basin.
The American Association of Petroleum Geologists