'Keeping Alaska's OCS leasing on schedule is critically important'

Alaska Gov. Sarah H. Palin, testifying at the US Department of the Interior's Apr. 14 hearing in Anchorage about a draft proposed five-year Outer Continental Shelf leasing plan:

"Even with enhanced efforts of conservation, the amount of new energy needed for this country increases dramatically as our population grows and our economy expands. Environmental challenges from the existing fuel mix and from the many renewable energy alternatives, coupled with dependence on foreign oil and foreign natural gas, means that there is no way to achieve these goals in the next few decades without a dramatic increase in domestic natural gas and a strong effort to modestly increase domestic oil production.

"Keeping Alaska's OCS lease sales, exploration, and development programs on schedule, especially in the Beaufort Sea and Chukchi Sea, is critically important to this effort. The resource numbers and the amount of energy needed in the next several decades speak for themselves.

"In order to achieve these goals within the next twenty years, environmentally responsible energy production from the Alaska OCS and state, federal and native onshore lands will be necessary. Recent assessments by the Department of Interior show that within the United States, Alaska is second only to the entire Gulf of Mexico in petroleum potential.

"The world-class potential of Arctic Alaska was verified in the recently released Circum-Arctic Oil and Gas Assessment (CARA) by the [US Geological Survey] which highlighted that Arctic Alaska was second only to the West Siberian Basin in total Arctic petroleum potential and the highest Arctic potential for oil. The assessment estimates that Arctic Alaska's mean technically recoverable resources of approximately 30 billion bbl of oil, 6 billion bbl of natural gas liquids and 221 trillion cubic feet of conventional natural gas.

"Of tremendous importance to the nation is a little appreciated fact: Exploration for and production of oil and gas from the Beaufort Sea and Chukchi Basins is critical for maintaining both the viability and longevity of the Trans-Alaskan Pipeline System (TAPS) and the existing producing oil fields on the North Slope.

"North Slope oil production is down to about one-third of peak production. At the peak TAPS transported 2.1 million bbl of oil a day, or approximately 24% of the nation's crude oil production. In February of this year, the pipeline averaged 739, 523 b/d, now 14% of the nation's crude oil production. And North Slope production continues to fall. By some estimates, without new production from the OCS, the TAPS pipeline will fall below its carrying capacity in the next decade.

"Once the pipeline shuts down it will mean the end of oil production from the North Slope. Because of the long lead time between leasing and production it can be more than a decade from first discovery to production. Delaying or restricting the OCS program in Alaska will lead to premature shutdown of TAPS, thereby denying America access to its large Arctic oil resource. This is neither in the State nor National interest . . .

Some would have you delay exploration and development in the federal offshore of Alaska over concerns related to global warming and its effects in the Arctic. First of all, let me make it clear that the State of Alaska understands the effects of climate change in the cryosphere. We Alaskans are living with the changes that you are observing in Washington. The dramatic decreases in the extent of summer sea ice, increased coastal erosion, melting of permafrost, decrease in alpine glaciers and overall ecosystem changes are very real to us.

"Many believe that in order to mitigate these long term and systematic changes it will require a national and global effort to decrease the release of human produced greenhouse gases into the atmosphere. However, simply waiting for low carbon emitting renewable capacity to be large enough will mean that it will be too late to meet the mitigation goals for reducing CO2 that will be required under most credible climate change models, including the International Panel on Climate Change modeled scenarios.

"Meeting these goals will require a dramatic increase, in the very near term, to preferred available fuels, including natural gas, that have a very low carbon footprint and that can be used within the existing energy infrastructure. These available fuels are required to supply the nation's energy needs during the transition to green energy alternatives.

"In the meantime, our nation cannot afford to wait for the capacity of renewable fuel sources to be large enough to meet our growing energy demands. So in a very real way delaying production in the Alaskan OCS will lead to less available natural gas for our nation meaning higher greenhouse gas concentrations."

Contact Nick Snow at nicks@pennwell.com

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