Analysis of Crude Oil Production in the Arctic National Wildlife Refuge

Energy Information Administration http://www.eia.doe.gov/oiaf/servicerpt/anwr/index.html

EIA concludes that new oil from ANWR would lower the world price of oil by $1.44 per barrel to 41 cents per barrel. Assuming a production start in 2018, 10 years after congressional approval, EIA projects that oil would peak at 780,000 barrels per day in 2027 and decline to 710,000 barrels per day in 2030. EIA said its projection is that ANWR oil production would amount to 0.4 percent to 1.2 percent of total world oil consumption in 2030. The figure is low enough for OPEC to counteract any price impact by lowering supplies to match the additional production from ANWR. Dependence on foreign oil would slip slightly to 48% in the best case scenario or 52% if production is on the lower end of projections. (Currently the US is dependent on foreign supplies for 54% of its oil.) Between 2018 and 2030, US spending on foreign oil would be reduced by $135 billion to $327 billion.

The main constraints to rapid development of ANWR are the limited weather windows for collecting seismic information and for drilling wells: 3 to 4 month in the winter and 2-3 months during the summer for transporting heavy infrastructure on barges to the drilling site. Advanced methods of extraction, such as steam injection, may not be useable due to the possible danger to the permafrost by this method. However, costly advanced extraction methods could become more attractive if prices continue to rise. EIA projected that it would not be until after 2030 for advanced methods to have an impact.