Joint Letter to House and Senate Leadership on Opening ANWR to Energy Exploration
Rep. Dennis Hastert
Sen. Bill Frist
Rep. John Boehner
Washington, D. C.
March 8, 2006
Dear Mr. Speaker/Mr. Majority Leader,
The undersigned organizations are dismayed that an obstructionist bloc in the first session of the 109th Congress was able to thwart the will of majorities in both the House and the Senate to enact legislation to open a small portion of the Arctic National Wildlife Refuge in Alaska to oil and gas exploration. We urge you to move budget reconciliation legislation (and any other vehicle that can overcome the procedural obstacles that will no doubt be used again to try to block the majority in both chambers) as soon as possible to accomplish this important goal and pledge that we will strongly support your efforts.
We believe that there are several important reasons to open ANWR. First, contrary to claims by environmental pressure groups that the oil and gas ANWR potentially contains are only a few “drops in the bucket” and that oil companies are not interested in exploring ANWR’s coastal plain, the U. S. Geological Survey’s mean estimate of economically recoverable oil and gas reserves under the coastal plain of ANWR is 10.4 billion barrels of crude oil. Such an amount would increase proven U. S. crude oil reserves by 50% and is equivalent to approximately a quarter century of current imports from Saudi Arabia, one of our top foreign suppliers. The USGS estimate was based on assuming oil priced at $30 a barrel; assuming $60 a barrel would give a much higher estimate of economically recoverable reserves.
Second, environmental pressure groups contradict themselves by arguing that opening ANWR would be nothing but a payoff to “Big Oil”. If it contains little oil, then it isn’t much of a payoff. If it does contain billions of barrels of oil, then oil companies will bid for the right to explore. It is estimated that the winners will initially pay several billion dollars for exploration contracts. When production begins, these companies will pay a twelve-and-one-half percent royalty, split evenly between the federal Treasury and the State of Alaska, on every barrel of oil and every cubic foot of gas produced. In addition, companies will pay billions of dollars of corporate income tax on their profits from production in ANWR, and their shareholders will pay billions of dollars of individual income taxes on dividends paid out of these profits. The revenues that will flow into the federal treasury from oil and gas production in ANWR should be compared with the equally colossal expenditures that are necessary to subsidize many of the alternative energy technologies and fuels supported by environmental pressure groups.
Third, the benefits of producing domestically more of the energy we consume are well known. Producing oil and gas from ANWR will be a huge boon to our economy, create thousands of high-paying jobs across the country, make us less dependent on foreign suppliers, and reduce our trade deficit. Moreover, Hurricanes Katrina and Rita demonstrated that relying on any one area for a large portion of our oil and gas supplies is imprudent, even when that area is in the United States. Production in ANWR will diversify our sources of supply and keep the Trans-Alaska Pipeline in operation for many decades.
Fourth, again contrary to the claims of environmental pressure groups, we believe that there is compelling evidence that oil and gas production in the coastal plain is compatible with protecting the environmental quality of the refuge and the wildlife that depend on it. Oil production already occurs in a number of other U. S. Wildlife Refuges. Oil has been pumped at Prudhoe Bay just to the west of ANWR for three decades without major environmental degradation, and during that period the caribou herd has grown from 6,000 to 32,000. Exploration and production in ANWR will be done with much more advanced technology than was used at Prudhoe Bay, which leaves a much smaller footprint on the land. The legislation that has passed both the House and the Senate would restrict disturbances of the land to 2,000 acres in the 1.5 million acre coastal plain. The coastal plain is not wilderness and was therefore not designated as a Wilderness Area when Congress expanded the refuge to 19 million acres in 1980. The coastal plain contains the Inupiat village of Kaktovik, roads, and former military installations. The eight million acres designated by Congress in 1980 as Wilderness Areas are far to the south and will not be affected by oil and gas production in the coastal plain.
Fifth, we believe that deference in setting federal land policies is due to the citizens and elected representatives of the States involved. Polls show that three quarters of Alaskans support opening ANWR. The Inupiat village of Kaktovik on the coastal plain officially supports opening ANWR. The Inupiat in Kaktovik own 94,000 acres in the coastal plain, and we believe that their rights to benefit from the resources they own should not be disregarded. Alaska’s elected officials of both major parties overwhelmingly support opening ANWR, including Alaska’s Senators, Representative, Governor, Legislature, and former two-term Democratic Governor Tony Knowles. They support opening ANWR because they know it will be of great economic benefit to their State and to the nation and because the experience of oil production at Prudhoe Bay has shown them that it can be done without harming the natural splendors of Alaska that they treasure.
For these reasons, we respectfully request that you make enacting budget reconciliation legislation to open the coastal plain of ANWR to oil and gas exploration one of your first and top goals for the second session of the 109th Congress. Thank you for your attention to our views.
Fred L. Smith, Jr., President
and Myron Ebell, Director, Energy Policy
Competitive Enterprise Institute
R. Bruce Josten
Executive Vice President, Government Affairs
U. S. Chamber of Commerce
Hon. John Engler
National Association of Manufacturers
Hon. Don Hodel
Former Secretary of the Interior
Former Secretary of Energy
National Taxpayers Union
Paul M. Weyrich
Coalitions for America
David Keene, Chairman
and J. William Lauderback, Executive Vice President
American Conservative Union
James L. Martin
60 Plus Association
Daniel R. Simmons
Director, Natural Resource Task Force
American Legislative Exchange Council
Grover G. Norquist
Americans for Tax Reform
The National Grange
Milton R. Copulos
National Defense Council Foundation
Gregory M. Cohen
President and CEO
American Highway Users Alliance
Congress of Racial Equality
Americans for the Preservation of Liberty
President and CEO
Small Business and Entrepreneurship Council
Charles S. Cushman
American Land Rights Association
Center for Individual Freedom
Citizens’ Alliance for Responsible Energy
Vice President for Legislative Affairs
Christian Coalition of America
Al Adams, Co-Chairman
and Bob Stiles, Co-Chairman
George C. Seman
Energy Stewardship Alliance