The House GOP leadership has announced their intention to take the Alaska drilling proposal out of the budgeted bill moving toward final passage. One day after the Senate badgered oil executives over record profits, the House looks positioned to step back one more time from America’s attempt to move toward oil independence.
The Congressional Office of Technology and Assessment reports that oil exploration in the Alaska National Wildlife Reserve – as contemplated in the current legislation – would require only about 5,000 to 7,000 acres, one-half of 1 percent of ANWR, or about 0.004 percent (four one-thousands percent) of Alaska’s total land mass. Putting together Prudhoe Bay with the coastal area of ANWR that may be opened to oil exploration and you still get an area that is about the size of a postage stamp on a football field. Prudhoe Bay’s gravel pads, gathering lines, production facilities, roads and other infrastructures occupy less than 6,000 acres of land, yet Prudhoe Bay remains America’s largest oil field.
The Energy Information Agency of the Department of Energy estimates that Alaska oil production averaged 902,000 barrels of oil per day from January through August 2004, about 16 percent of total U.S. oil production during that period, most of which comes from Prudhoe Bay. Opening up even a limited area of ANWR for drilling would offer the prospect of producing from Alaska possibly 40 percent or more of the oil consumed in America.
In writing “Black Gold Stranglehold: The Myth of Scarcity and the Politics of Oil,” Craig Smith and I calculated the cost of importing foreign oil:
Each day we import some 12 million barrels of oil, about 60 percent of all the oil we consume. About 20 percent of our oil imports come from Persian Gulf countries, averaging about 2.4 million barrels a day. At $50 a barrel, this means we are sending more than $600 million a day overseas for oil, of which $120 million a day goes to Persian Gulf countries. At $60 a barrel, we are sending $720 million a day overseas for oil, of which $144 million goes to the Persian Gulf. With oil at $60 a barrel, we are sending overseas nearly a quarter of a trillion dollars each year just to buy oil.
We have never before in our history experienced this massive a transfer of our wealth overseas. Moreover, our dependence upon foreign countries means we are increasingly vulnerable to being held hostage from oil. Do we not send back the flood of Mexican illegal immigrants crossing our borders because we import 1.75 million barrels of oil a day from Mexico? Are we forced to tolerate Hugo Chavez’s socialism and insults to America because we import 1.3 million barrels of oil a day?
The internal politics of our foreign oil partners can directly affect us by their willingness to open up or shut down the oil spigot. Today we have to have foreign entanglements because we have to import foreign oil.
Perhaps the Sierra Club ought to be forced to register as a foreign lobbyist for Saudi Aramco? Certainly foreign oil companies have no better friend in America than radical extremists who stand in the way of every effort to produce more oil in Alaska and offshore, where we know we have oil not currently registered in our foreign reserves. Why not? Radical environmentalists will not tolerate any new exploration of oil in America, no matter how reasonable or environmentally responsible.
Listening to the environmentalists, we could almost get the impression that they don’t want even limited exploration of ANWR because they are afraid of how much oil we might find in Alaska. How many working motorists forced to pay $50 to $75 to fill their gas tanks can still afford their Sierra Club memberships? When we move to 70 percent dependence on foreign oil, will working Americans still be comfortable to leave billions of barrels of unexplored oil in the ground under Alaska and offshore?
These are important questions, especially when the Senate has raised the question of confiscating oil company “windfall profits.” We have argued that the oil companies need to realize they have obligations to be socially responsible. What is the oil company plan to invest profits in refineries? We have not built a new refinery in the United States in the last 30 years. This is a key part of the “stranglehold.” Even if we drilled more oil in ANWR, we could not get more gasoline into the pump unless we expand our refining capabilities.
We call here for more hearings, this time with the environmentalists. Let’s get a balance between protecting every caribou and allowing some reasonable exploration of domestic oil so we can take an important step away from foreign oil dependence. Let’s arrive at a reasonable formula for the environmental barriers to building new refineries so we can press oil company executives to put more capital into the supply side of the equation.
By removing the ANWR drilling provisions from the House budget bill, GOP congressmen who want to move to the center by appearing more “green” have probably achieved this limited objective. But are these same congressmen willing to face constituents when the voting public realizes each concession to radical environmentalism is another move away from increasing domestic supplies we badly need – not only to keep oil prices affordable, but to make sure we do not compromise our national security on the altar of keeping all environments “pristine”?