Good evening. My name is Carl Portman, Deputy Director of the Resource Development Council. RDC urges BOEM to move forward with a robust 2012-2017 offshore oil and gas leasing program for the Chukchi and Beaufort Seas. RDC supports including in the five-year program lease sales that were withdrawn from the 2007-2012 program. These lease sales and subsequent exploration activities should be allowed while additional studies are conducted.
Given its potential for immense recoverable reserves and enormous economic benefits to the state and nation, the Alaska OCS should be opened to responsible development. The OCS has the potential to sharply increase throughput in the Trans Alaska pipeline, which is currently operating at two-thirds empty. Without new significant discoveries of oil, the pipeline could be uneconomic to operate at some point after 2020, leading to catastrophic implications for Alaska’s economy.
RDC supports offshore exploration in Alaska because it is confident operations can occur safely, and there are important distinctions between drilling in the deep waters of the Gulf of Mexico and the shallow waters offshore Alaska. I would like to point out that 30 wells have been drilled in the Beaufort and five in the Chukchi – all without incident. These wells were drilled in the 1980s, utilizing older technology.
The responsible development of vast oil and gas deposits in the Arctic would significantly boost Alaska’s economy, create tens of thousands of jobs, improve the economic viability of the proposed natural gas pipeline and reduce America’s reliance on foreign energy. It would also generate hundreds of billions of dollars in government revenues.
The Alaska OCS is an important future source of U.S. energy supply with an estimated 27 billion barrels of oil and 132 trillion cubic feet of natural gas potentially in place. By comparison, total production from the North Slope over the past 32 years has been approximately 16 billion barrels. The potential reserves offshore Alaska is more than all the current total proven U.S. oil reserves.
Yet despite this potential, the U.S. chose to import in the past year alone more than 60 percent of the oil it consumed – at a great cost. Not developing its reserves in Alaska and those elsewhere in America makes no sense from an economic and energy security stand point as recent events in the Middle East and the recent spike in oil prices demonstrate.
RDC and many Alaskans share President Obama’s view that America needs to conserve more and put new emphasis on renewable and alternative energy. Yet America still needs to pursue new oil and gas production, given the fact it will take decades before renewable energy becomes a dominant energy source.
If we do not turn to the Alaska OCS, then from where would new production come? For every barrel of oil not developed domestically, the nation will have little choice but to import another from foreign countries – where weaker environmental regulations often apply. Given economic and geopolitical concerns, that barrel should be produced here in the U.S.
It is vital that our nation’s abundant energy resources be fully utilized for compelling economic and energy security reasons. RDC encourages BOEM to move forward with the 2012-2017 program, including the lease sales originally scheduled under the previous five-year program.
RDC submitted detailed comments on the 2012-2017 program on June 29, 2010. Please include those comments with this testimony as part of the official record.
Thank you.
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