Arctic National Wildlife Refuge (ANWR) 1002 Area

According to the most recent USGS assessment, which occurred in 1998, the ANWR 1002 area is estimated to contain between 6 and 16 billion barrels of technically recoverable oil and the mean estimate is over 10 billion.  No significant seismic analysis has ever been done in ANWR and no exploratory drilling has ever occurred, other than a single test well on Native lands, the results of which have never been released.

The western edge of the ANWR 1002 area lies about 65 miles East of Prudhoe Bay, which contains the largest land based oil discovery ever made in the U.S. and is the origination point for the Trans-Alaska Pipeline System (TAPS).  The known geology of the 1002 area, the proximity to Prudhoe Bay, large deposits of oil and gas discovered just a kilometer from ANWR's western edge, and other discoveries offshore along the coast of ANWR indicate that the high estimate may be more likely.

The EIA AEO 2008 ANWR access case assumes that first production would occur 10 years after the enactment of legislation opening ANWR to oil and gas leasing.  This assumption is based on the following timeline:

• 2 to 3 years to obtain U.S. Bureau of Land Management (BLM) leases.
• 2 to 3 years to drill a single exploratory well, due to the limited winter drilling season.
• 1 to 2 years to develop a production development plan and obtain BLM approval for that plan.
• 3 to 4 years to construct the necessary infrastructure and to drill and complete development wells.

In the EIA ANWR access case, production rates range from about 800,000 barrels per day to about 1.9 million barrels per day and depend on very conservative estimates regarding the size of the fields discovered, the quality of the oil found, and the specific characteristics of the reservoirs.  Larger fields and/or more viscous oils than assumed could substantially increase production rates.

The cost of producing oil from ANWR was estimated at $25 per barrel in 2000.  The low production costs, the proximity to TAPS, the other infrastructure available nearby, and vertical drilling technology would suggest that, if the bureaucratic/regulatory delays and environmental challenges can be minimized, oil could be flowing from ANWR in 2 - 3 years or less and reach maximum production rates within 4 - 5 years.  Legislation would be required to shorten the 10 year time period in the EIA forecast.

Due to the long and colorful political history of ANWR, with several attempts to open it for oil exploration and production thwarted by Congress and environmentalists, the type of legislation required to speed up development is not assured.  One of the main reasons given by opponents to ANWR exploitation is that it would affect the calving grounds of the Porcupine caribou.  Experience with North Slope development and production and TAPS construction and operations suggest those fears are misguided. Recent development plans for the nearby Sourdough field may force the federal government's hand or cost us the royalties we might otherwise receive for ANWR oil.

Additional ANWR resources

Sourdough - Forbes 1997

Sourdough Legal Opinion

EIA - Potential Production Estimates

Potential Recoverable Oil in ANWR and Production Rates

FWS: Arctic Refuge: Oil and Gas Issues

EIA - 2008 Analysis of Crude Oil Production in ANWR

EIA AEO 2008 - Oil and Gas Assumptions