Alaska Governor Scraps Arctic Oil Study

Alaska’s Governor Bill Walker has proposed to use US$10 million previously earmarked for a seismic study of the Arctic National Wildlife Refuge to update the state’s archaic 911 system.

The state administration last month asked the legislature for US$10 million to start a seismic survey campaign in the ANWR aimed at encouraging oil and gas companies to consider bidding for the acreage to be offered under the new tax law approved at the end of last year.

Alaska is currently struggling with a budget crisis, and allocating the scarce available resources is proving to be a tough task. The state has also seen a consistent decline in its oil production. The Energy Information Administration has projected that the state will produce an average 500,000 bpd next year. That’s down from 2.09 million bpd 30 years ago—a fact which has caused new exploration to be a top priority.

Opening up the National Wildlife Refuge was a stipulation in the tax reform bill passed in December, and there were plans to hold the first lease sale there as early as 2019. Given the opposition from environmentalist groups and the Democrats, it was doubtful from the start if the lease sale would take place and, if it did, how much interest it would attract from the oil industry.

Still, the Alaska administration evidently wanted to be prepared by spurring interest with up-to-date resource data—the only estimates for oil and gas in the ANWR are 30 years old.

In his letter to Alaska’s Congress, Walker said oil and gas exploration in the ANWR is still on the table, but the US$10 million is "not needed for seismic work at this time."

Alaska’s emergency system is very out of date, with people in some rural areas having to dial a 1-800 number for help. Under the new proposal, the funds will be used to centralize Alaska’s State Troopers emergency dispatch system. It currently relies on four regional hubs, all of which use different computer systems, the Anchorage Daily News notes.

By Irina Slav for Oilprice.com

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