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CEA president: ‘Road to energy security runs through Alaska’

Posted: July 10, 2013 - 2:57pm

The Consumer Energy Alliance is working with private industry and state officials to raise awareness about the need for increased oil and gas development in Alaska, CEA President David Holt told the Resource Development Council June 26.

Holt said his message to the rest of the country is the same as it was when he spoke to RDC three years ago.

“The road to U.S. energy security runs through Alaska,” he said.

Development of the famed Bakken shale oilfield in the Dakotas and Eastern Montana was the driver behind North Dakota’s 13.6 percent increase in real gross domestic product, or GDP, in 2012 — the largest increase in the country, Holt said.

Alaska’s real GDP grew 1.1 percent last year and the national GDP grew 2.5 percent, according to the U.S. Department of Commerce.

He said that the increased oil and gas production in the Lower 48 helped U.S. production of durable goods increase by 9.6 percent last year.

Holt cited Alaska providing 11 percent of the nation’s oil as a reason for the rest of the country to take notice of regulatory decisions affecting energy development in the state. The state is currently fourth in the nation in oil production.

He said CEA is trying to make sure public perception doesn’t discount Alaska while new Lower 48 oil is a timely topic.

Popular estimates put undeveloped oil resources in the Arctic National Wildlife Refuge, National Petroleum Reserve-Alaska and those offshore in the Arctic at around 30 billion barrels, twice that of the total Bakken formation, Holt said.

If they were to be developed, new Alaska resources could help cut national oil imports by 15 percent, he said. In 2012, the U.S. imported roughly 40 percent of the oil it consumed, according to the federal Energy Information Administration, or EIA.

The entire Lower 48 oil boom has cut that number down from 60 percent since 2006, Holt said.

He added that increased state production could help keep $100 billion per year in country, money that would otherwise be spent on imported oil. Without it, the U.S. will go from spending $800 million per day on foreign oil now, to $1.2 billion by 2040, Holt said, citing an EIA forecast.

The difference between Alaska and the rest of the country in terms of oil and gas development is the primary landowners. Where most development to the south is occurring on private land, Holt said the challenges here come from the federal government owning land with development potential.

“The (federal) regulatory incoherence and conflicting and shifting priorities is the single biggest hurdle to energy production in the state,” he told RDC.

Holt lauded Gov. Sean Parnell, the Congressional delegation and various Alaska businesses for signing a 2012 letter drafted by the CEA and sent to President Obama urging for streamlined oil and gas regulations. He also said CEA has collect roughly 200,000 public comments from individuals in the Lower 48 about Alaska oil and gas development as a way to raise broad-based awareness about the state’s role in the national energy supply.

“Together we can revitalize the Alaska energy situation and what that means to the Lower 48,” Holt said.

Elwood Brehmer is a reporter for the Alaska Journal of Commerce.

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