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Bush: ANWR still in the picture Despite Democratic-led Congress, White House tenders controversial petroleum development provision in fiscal 2008 budget proposal Rose Ragsdale For Petroleum News
President Bush inserted oil drilling on the coastal plain of the Arctic National Wildlife Refuge into the $2.9 trillion budget proposal for fiscal 2008 that he unveiled Feb. 5.
But the move likely will amount to little more than wishful thinking, according to at least one observer.
The president seeks to open to drilling the 1.5 million-acre 1002 area of ANWR that Congress set aside for future possible oil and gas leasing more than a quarter of a century ago as part of his plan to lessen U.S. dependence on foreign imports of crude.
Bush aims to tap the 5.7 billion to 16 billion barrels that U.S. Geological Survey scientists estimate can be recovered from the strip of land bordering the Arctic Ocean in the 19 million-acre refuge.
The USGS expects peak production could hit 1 million barrels a day, or “nearly 10 percent of the nation’s current daily imports ... and would result in an estimated $7 billion in new revenues,” the administration said in its budget. The income would be split 50-50 between the federal government and the State of Alaska.
The budget blueprint directs the Department of the Interior to conduct “environmentally responsible oil and gas exploration and development.”
“The 2008 Budget will support necessary activities to begin ANWR leasing and fund continued leasing of the National Petroleum Reserve-Alaska,” it said.
Democrats have traditionally opposed 1002 drilling Democratic leaders in Congress seemed to ignore the ANWR drilling provision in initial criticism of Bush’s plan, focusing instead on the lack of research and development funds for new domestic sources of oil and gas and other aspects.
But that does not signal a change of heart among the Democrats, who have traditionally opposed opening the coastal plain to oil and gas exploration and development.
In past years, a Republican-controlled Congress has narrowly missed gaining approval for opening a 2,000-acre section of the Arctic plain — roughly the size of Dulles Airport — to drilling, largely due to staunch opponents among the Democrats. Backed by environmentalists who say the area’s wildlife, especially its large caribou herd, would be harmed by the activity, these members of Congress have campaigned vigorously to keep development out of the refuge.
Republican leaders say they will continue to support the president’s energy plan, including ANWR drilling.
Sen. Pete Domenici, R-N.M., who is the ranking member of the U.S. Senate Energy and Natural Resources Committee, affirmed his ongoing support for the development of ANWR in a statement Feb. 5.
Alaska Sen. Ted Stevens also approves of Bush’s plan.
“The president’s support for ANWR, coupled with his other energy initiatives, shows his commitment to our nation’s energy security,” Stevens said. “Whether ANWR sees the light of day depends on whether members of Congress recognize that a robust energy policy consists of domestic production as well as conservation and development of our renewable resources.”
U.S. Rep. Don Young, R-Alaska, said he is glad that Bush recognizes the significant impact “reopening a small sliver of ANWR” can have on U.S. oil imports and the nation’s economy.
“The President’s budget anticipates $4 billion over the next five years from ANWR leasing. However, ANWR’s real impacts will increase U.S. energy reserves by almost 50 percent in combination with the thousands of new jobs and billions in revenues this careful development will bring to the nation,” Young said in a statement Feb. 5.
“The Congressional Research Service estimated last year that at today’s oil prices, ANWR could generate over $89 billion in federal royalties and corporate income tax receipts. More energy, more jobs, and more revenue for America are a winning combination,” Young added.
But ANWR drilling has little chance for passage with the Democrats in charge, said Roger Herrera, longtime ANWR lobbyist and consultant.
“We’re in the midst of a ‘no gain’ game,” Herrera said Feb. 6. “The ANWR supporters don’t have a filibuster-proof vehicle to advance their cause. President Bush did a sensible, positive thing putting ANWR drilling in the budget as a line item, but it is so easy to table it.”
Barring oil supply disruptions, especially in the Middle East, that drive up prices and threaten the stability of oil markets, Herrera said ANWR drilling “has no chance of surviving in the final budget.”
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