Letter is wrong on Arctic oil reserves
Reader Roger Fitzgerald points out that Doug Dribben, whose letter to the editor appears in today's edition of The Sun, is incorrect on estimated oil reserves in the Arctic National Wildlife Refuge.
But if President Bill Clinton had not vetoed legislation in 1995 to permit oil drilling there [ANWR], we could have an additional 27 million gallons of gasoline and diesel fuel from a million barrels of oil daily, which, as Democratic Sen. Charles E. Schumer noted on May 13 in a speech to the Senate, would cause the price of gasoline to fall "50 cents a gallon almost immediately."The U.S. Minerals Management Service estimates that ANWR has about 85 billion barrels of oil and 420 trillion cubic feet of natural gas. This is 10 times the amount of oil and 20 times the natural gas that Americans use annually.
It's not true that ANWR has an estimated 85 billion barrels of oil. Even calculations from pro-drilling interests put recoverable barrels at between 6 billion and 16 billion. The 85 billion barrels is the estimate for the entire outer continental shelf.
A million barrels daily is a good estimate of what ANWR might produce. But the Energy Information Administration has a far less optimstic -- and more realistic -- assessment of how it would affect oil prices than does Sen. Schumer.
Additional oil production resulting from the opening of ANWR would be only a small portion of total world oil production, and would likely be offset in part by somewhat lower production outside the United States. The opening of ANWR is projected to have its largest oil price reduction impacts as follows: a reduction in low-sulfur, light crude oil prices of $0.41 per barrel (2006 dollars) in 2026 for the low oil resource case, $0.75 per barrel in 2025 for the mean oil resource case, and $1.44 per barrel in 2027 for the high oil resource case, relative to the reference case.







Comments
So what's your point? There is no single solution to energy independence. We significantly restrict oil drilling on our shores as well. How much could that bring in? Increased production combined with nuclear, solar and wind production, combined with increased efficiency measures, is the best path forward, yet each special interest group has an axe to grind about least one of those, so nothing happens. Except ethanol, of course, because it got cloaked as a farm subsidy
Posted by: Ray | June 11, 2008 2:26 PM
Of course, the study you reference is based on 2004 estimates. It also is incorrectly summarized. Your readers can read the entire thing for themselves and see the truth at http://www.eia.doe.gov/oiaf/servicerpt/anwr/pdf/sroiaf(2008)03.pdf.
Posted by: Doug Dribben | June 11, 2008 2:33 PM
Forgive me if that just sounds cynical to me.
Posted by: Bobbi | June 11, 2008 10:35 PM
I read the May 2008 EIA report Mr. Dribben cited. Surprisingly, the truth is that the 2004 study is optimistic relative to the report he cited. In fact, the text Jay cited is included in the Summary of the cited report (page 6).
The Summary goes state that peak production in the most optimistic case is estimated to be 1.45 million barrels a day in 2028. This doesn't quite add up to 50 cents of of a gallon of gas. The EIA report uses a 2006 price of $66 per barrel as a baseline. Using the best case scenario of $1.44 off of the price, that leaves $64.56 per barrel. For arguements sake, assume that you can get 42 gallons of gas out of a 42 gallon barrel of oil, that means the cost is 64.56/42 = $1.53 per gallon gas. Without ANWR, the price is 66/42 = $1.57 per gallon. That is a wopping 4 cents per gallon. You can do better than this at the Shell station off I-695 at Route 40 on Thursdays.
Finally, between 2018 and 2030 the reports estimates (best case) that ANWR can produce 4.3 billion barrels (peak production is estimated at 2028, declining thereafter). I am not sure where 85 billion comes from, but it isn't this report.
Personally, I think we are going to eventually drill ANWR and off shore. I am Ok with drillling, but I think we should hold off as long as possible. Otherwise, we are just going to keep wasting our resources just to look cool in Hemi or a Hummer. Embracing conservation and using less will make us think about what is really important.
Posted by: Larry | June 12, 2008 9:20 AM
I read the May 2008 EIA report Mr. Dribben cited. Surprisingly, the truth is that the 2004 study is optimistic relative to the report he cited. In fact, the text Jay cited is included in the Summary of the cited report (page 6).
The Summary goes state that peak production in the most optimistic case is estimated to be 1.45 million barrels a day in 2028. This doesn't quite add up to 50 cents of of a gallon of gas. The EIA report uses a 2006 price of $66 per barrel as a baseline. Using the best case scenario of $1.44 off of the price, that leaves $64.56 per barrel. For arguements sake, assume that you can get 42 gallons of gas out of a 42 gallon barrel of oil, that means the cost is 64.56/42 = $1.53 per gallon gas. Without ANWR, the price is 66/42 = $1.57 per gallon. That is a wopping 4 cents per gallon. You can do better than this at the Shell station off I-695 at Route 40 on Thursdays.
Finally, between 2018 and 2030 the reports estimates (best case) that ANWR can produce 4.3 billion barrels (peak production is estimated at 2028, declining thereafter). I am not sure where 85 billion comes from, but it isn't this report.
Personally, I think we are going to eventually drill ANWR and off shore. I am Ok with drillling, but I think we should hold off as long as possible. Otherwise, we are just going to keep wasting our resources just to look cool in Hemi or a Hummer. Embracing conservation and using less will make us think about what is really important.
Posted by: Larry | June 12, 2008 9:20 AM
Democrats shot down a measure yesterday that would have allowed drilling 50-250 miles from shore. The US is the only nation that doesn't allow this. Newer technology makes it clean and viable. In the meantime, we overlook oil and natural gas right in our own back yard--which isn't stopping Mexico and Canada
Posted by: Mike | June 12, 2008 10:41 AM
ANWR is a joke. it will only make the investors in its development short term returns; it's not a solution to any problem. it won't save us money, it will add a little more than a drop to the total oil needed for transportation fuel, and it will most definitely change the quality of the refuge. the people who support this drilling cannot make a factual argument and the politicians supporting it have obvious vested interests. how can anyone be so stupid as to trust an administration run by oil executives with this decision? like i said, ANWR is a joke, a joke on us.
Posted by: gÄrcho | June 12, 2008 12:36 PM
The oil companies and the military industrial complex have committed crimes against the Republic through their proxy in the white house. The next president will have some ugly decisions to make; he should investigate every corporation that has made "wind fall" proffits via Iraq and the artificial inflation of oil prices.
Posted by: Timothy Edgin, Houston Texas | June 12, 2008 1:00 PM