A new study finds that the benefits of opening more federal lands to oil and natural gas drilling would produce vastly more economic benefits and tax revenues than previous government estimates show.
The Institute for Energy Research released a study by Dr. Joseph Mason, a professor at Louisiana State University, in response to a Congressional Budget Office report from August that analyzed the benefits of opening up federal lands and waters that are restricted by law or administration policy from leasing.
“Even conservatively estimated, the economic effects of allowing access to U.S. energy resources are significant,” Mason told reporters over the phone.
The CBO found that opening up federal lands would generate a total of $7 billion in revenues during the first decade — $5 billion from ANWR and $2 billion from areas of the outer continental shelf. The CBO projected revenues from opening more lands to be between $2 billion and $4 billion from 2023 to 2035.
However, the CBO estimates are low because they only take into account revenues raised from leases and ignores the wider economic impacts on the economy from opening more lands, this new study claims.
“I analyze a short-run scenario [seven years], which encompasses the next seven years. In the short-run we’re not extracting oil and gas, but of course… the lands that haven’t been explored in thirty years will be explored,” Mason said. “That will employ scientists and that will employ other workers on site to undertake the exploration. They’ll bring those wages home, their families will spend those wages, that will feed jobs, wages, tax revenues throughout the economy, and all of this is ignored by the CBO.”
“In the long-run, when you get to the extraction phase, the effects are even greater,” he added.
Mason found that opening up more federal lands would generate as much as $24 billion annually in taxes over seven years for the federal government in addition to lease revenues estimated by the CBO. In the long-run, $86 billion annually would be generated in federal taxes from more activity on federal lands and in federal waters.