The CBO reports that opening up the Arctic National Wildlife Refuge (ANWR) to oil and gas drilling would generate $5 billion in revenue over the next ten years and potentially $25 billion to $50 billion in revenue between 2023 and 2035.
The report, requested by House Budget Committee Chairman Paul Ryan, examined removing restrictions that also cover other lands and offshore areas.
The $5 billion generated over the next ten years would mostly come from bonus payments made by private firms for the opportunity to explore and develop resources. Royalties on oil and natural gas production would not materialize for about a decade because of the lag time between leasing the land and the beginning of oil and gas production.
Under current law, 90 percent of the revenue gained from bonus payments and royalties from ANWR would go to the state of Alaska. However, many legislative proposals in the past have proposed a 50-50 split between the states and the federal government.
According to estimates from the Department of the Interior, ANWR contains about 8 percent of the U.S.’s undiscovered oil, totaling 8 billion barrels in an area of 1.5 million acres.
The House bill is sponsored by Rep. Doc Hastings of Maryland and the companion Senate bill is sponsored by Alaska Republican Senator Lisa Murkowski who has long championed for increased oil and gas development in ANWR.
“The OPEN Act sends a clear message that America is serious about developing its energy resources to fuel an economic recovery,” Murkowski said. “This bill will not only improve our energy security and create jobs, it also ensures that states receive a fair share of the revenue generated off their coastlines.”
Last year, Murkowski introduced two bills to open up ANWR to drilling. One bill allowed for oil and natural gas drilling in ANWR by using underground directional drilling from locations outside of the refuge. The other bill would open ANWR’s the coastal plain for development but limit drilling activities inside the refuge to 2,000 acres.
“It is unfortunate that we’re still having this discussion about whether to develop the [ANWR coastal plain] area in Alaska,” Murkowski said in a 2011 hearing. “It’s been well documented and repeated that, depending on the price of oil, nearly $300 billion in federal revenue – and untold jobs – could be associated with developing the [ANWR coastal plain] area. Consider what that amount could fund; consider what it would allow us to preserve.”
“I think it should be more appropriate that we discuss when and how to develop this incredible national resource,” she concluded.
Presumptive Republican presidential nominee Mitt Romney supports drilling in ANWR.
“I will permit access to our resources in the Gulf of Mexico, the Outer Continental Shelf, western lands and the Alaska National Wildlife Refuge,” he wrote in March. “America can be the world’s next energy superpower, if we give ourselves the chance.”
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