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Numbers will hurt proposal to lock up ANWR
Rose Ragsdale For Petroleum News
The latest bid by Congressional Democrats to permanently block energy development in the Arctic National Wildlife Refuge stands no better chance of success than earlier efforts to open the refuge’s coastal plain to drilling by Congressional Republicans, according to drilling advocate Roger Herrera.
Twenty-six Democrats, led by Sen. Joe Lieberman, D-Conn., introduced a bill Nov. 7 that would place a wilderness designation on ANWR, ostensibly to protect its 1.2 million-acre coastal plain from the threat of oil and gas development.
The legislation marks at least the second time this year that congressional Democrats have proposed legislation to block oil and gas drilling in ANWR. U.S. Rep. Edward Markey, D-Mass., introduced a bill in January aimed at converting the barren tundra of the coastal plain into permanent wilderness.
More than 25 years ago, Congress set aside this so-called 1002 Area for future energy development.
Development proponents quote U.S. Geologic Survey estimates that ANWR’s coastal plain could produce a million barrels per day of oil for at least 30 years.
Drilling opponents say the region should exclusively preserve abundant populations of polar bears, caribou, musk oxen, and snow geese.
“America’s strength is not in our oil reserves, but in our reserves of innovation,” Lieberman said in announcing the legislation. “The answer is not to drill in our national treasures but to increase our energy efficiency and find alternative and renewable sources of energy.”
Delegation promises fight Alaska’s congressional delegation, Sen. Ted Stevens, Sen. Lisa Murkowski, and U.S. Rep. Don Young, all Republicans, promptly vowed to fight the legislation.
“With the price of oil approaching $100 per barrel and with our energy dependence on hostile foreign nations at a record high, now is not the time to cut our country off from the resources held in Alaska’s coastal plain,” the delegation said in a statement Nov. 7.
But the Democrats likely will encounter the same type of roadblocks in the Senate that pro-development Republicans ran into at least 10 times in the past decade trying to enact drilling legislation, said Herrera, a longtime Alaska ANWR drilling advocate.
“Certainly a majority of the Democrats would like to lock it up forever, but that is virtually impossible given the present makeup of Congress. This legislation has to be considered a threat, but it shouldn’t keep us awake at night,” Herrera told Petroleum News Nov. 8.
The undecided in Congress will ultimately decide ANWR legislation, and those individuals “can surely recognize that $100 oil is more important to the country’s future than $20 oil,” Herrera said. “But then again, it’s difficult to tell what they think, or if they think at all.”
Oil prices likely to go up In the short term, prices are likely to continue to climb, Herrera said.
One theory is that speculators are bending oil prices to their will, and profit-taking is driving prices higher.
But Herrera said he strongly suspects the bigger force at work in world oil markets is ongoing global economic growth, which is spurring demand for crude.
“I can’t see world economies putting their growth on hold because of higher prices, so I think demand will continue to be rather bullish for a while,” he said.
But the direction of oil prices in the medium term is much more difficult to predict. Historically, long periods of economic growth have been balanced by reversals or recession. “If we see a downturn in oil prices, it will mean our economy will be in a downward spiral, and we will all suffer accordingly,” Herrera said. “It’s a very edgy time.”
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