Misleading The Public
An Error-Filled Argument
The main proponent of drilling in the Arctic Refuge is a lobby organization called “Arctic Power”. While this advocacy group is reeling as three of the four major oil companies on the North Slope have dropped their support over the last few years, they nevertheless have the backing of the Alaskan Legislature and ExxonMobil, the two potential beneficiaries of opening the Refuge. On Arctic Power’s website, they list the “Top 10 Reasons To Support Development In ANWR.” Through the use of vague semantics and numbers, this company has misled the American Public. In order to show the fallacy of their arguments, we provide a point-by-point refutation of their analysis below. Arctic Power’s “Top 10” list, directly quoted from their website, is in normal text; the reality of the situation is in italics.
Misleading Argument #1: “Only 8% of ANWR Would Be Considered for Exploration”
1. Only the 1.5 million acre or 8% on the northern coast of the ANWR is being considered for development. The remaining 17.5 million acres or 92% of ANWR will remain permanently closed to any kind of development. If oil is discovered, less than 2000 acres of the over 1.5 million acres of the Coastal Plain would be affected. That’s less than half of one percent of ANWR that would be affected by production activity.
1. The 1.5 million acre coastal plain is the heart of the Arctic Refuge, and any development there would have significant ramifications across the entire Refuge far greater than development anywhere else. The reason for this is simple: it is the most important breeding ground for a wide variety of animals, including the Porcupine caribou herd, the polar bear, and over 70 species of birds. Furthermore, the 2,000 acre “footprint” only consists of where the drilling areas actually touch the ground and does not include supporting infrastructure such as pipelines and gravel and ice roads. The Interior Department conservatively estimates that all-told around 12,500 acres will be covered by development. The development would not be contained in one area, it would crisscross the entire 1.5 million acres with no restrictions and directly affect the entire region. Even President Bush’s proposed budget concedes that all 1.5 million acres would be leased to oil companies. A 2002 USGS report concluded that with development of the full coastal plain, it would be impossible for the Porcupine caribou herd to increase in numbers, even under the best possible conditions, and its population could easily see double-digit declines in upcoming years.
Misleading Argument #2: “Revenues to the State and Federal Treasury”
2. Federal revenues would be enhanced by billions of dollars from bonus bids, lease rentals, royalties and taxes. Estimates on bonus bids for ANWR by the Office of Management and Budget and the Department of Interior for the first 5 years after the Congressional approval are 4.2 billion dollars.
2. While it is true that the Treasury would receive revenues from opening the Arctic Refuge, most Americans will see very little of the money. The Alaskan Legislature would receive between 50 and 90 percent of the total revenues, leaving the Federal Treasury with as little as 10 percent of the payments from oil companies. Furthermore, with two of the four major North Slope oil companies declaring unequivocally that they have no plans to drill in the Refuge, there is a strong possibility that the U.S. will not receive the full value of the land on their leases and the revenues may be even less than OMB estimates. On top of all this, the Administration’s budget estimates are wildly speculative. Oil companies currently lease land on the North Slope for an average of $53 an acre since 1991; to meet budget projections these companies would need to rent the entire 1.5 million-acre coastal plain for well over $2,000 per acre.
Misleading Argument #3: “Jobs To Be Created”
3. Between 250,000 and 735,000 ANWR jobs are estimated to be created by development of the Coastal Plain.
3. These numbers come from a 15-year-old report paid for by the American Petroleum Institute. Recent reports show that 735,000 new jobs is a wild exaggeration and that the reality will be far below that number. The Bureau of Labor Statistics estimated that 60,000 jobs would be created; the Congressional Research Service also estimated 60,000, with an absolute maximum of 130,000. The reality is that the use of renewal energy generates about three times as many jobs as an equivalent expenditure on oil, according to an analysis by the Wisconsin Energy Bureau. A recent report by the Tellus Institute showed that investment in renewable energy and increased efficiency would create 700,000 jobs by 2010, and 1.3 million jobs by 2020, far more than what would be created by opening the Arctic Refuge. And even labor unions, like the SEIU, CWA, and NFIU—unions literally representing millions of workers—oppose drilling in the Refuge.
Misleading Argument #4: “Economic Impact”
4. Between 1977 and 2004, North Slope oil field development and production activity contributed over $50 billion to the nation’s economy, directly impacting each state in the union.
4. While the North Slope has had an important economic impact, there is little reason to believe the Arctic Refuge will produce anywhere near the same figures. The Refuge, according to the U.S. Geological Survey, has around 3.2 billion barrels of economically recoverable oil, and it is spread across the plain in small deposits. The North Slope, on the other hand, has produced well over 16 billion barrels of oil, more than five times the economically recoverable oil in the coastal plain and more than twice the Refuge’s total projected deposits. In addition, if the U.S. government decided to invest in renewable energy instead of drilling the Refuge, the economic impact would be far more significant and longer-lasting for Americans across the nation.
Misleading Argument #5: “America’s Best Chance for a Major Discovery”
5. The Coastal Plain of ANWR is America’s best possibility for the discovery of another giant “Prudhoe Bay-sized” oil and gas discovery in North America. U.S. Department of Interior estimates range from 9 to 16 billion barrels of recoverable oil.
5. The Department of the Interior may estimate 9 to 16 billion barrels of recoverable oil, but due to the high costs of recovery it is only economically feasible to drill 3.2 billion barrels. In addition, even if another “Prudhoe Bay-sized” discovery were made- a possibility that has a very small chance of occurring- the discovery would have almost no effect other than to profit ExxonMobil. Oil and gas prices, set internationally, would be unaffected, and America still would need to import well more than 60 percent of its oil.
Misleading Argument #6: “North Slope Production in Decline”
6. The North Slope oil fields currently provide the U.S. with nearly 16% of it’s (sic) domestic production and since 1988 this production has been on the decline. Peak production was reached in 1980 of two million barrels a day, but has been declining to a current level of 943,000 barrels a day.
6. The U.S. annually consumes more than 26 percent of the world’s total oil production while holding a mere 3 percent of global oil reserves. The result is that America imports the vast majority of its oil- and even the elimination of the North Slope fields would have a negligible effect on world oil prices or America’s reliance on foreign oil. Nevertheless, this possibility is highly unlikely. The reality is that oil fields on the west side of the North Slope- the region further away from the Arctic Refuge- have recently outperformed expectations, and some fields have done so by wide margins. ConocoPhillips is conducting a major expansion at its Alpine field in the Western North Slope to boost daily production at that single facility from 64,500 barrels per day to over 90,000. In fact, both BP and ConocoPhillips recently announced their intentions to invest even more money in promising oil fields in the North Slope, and with the Bush Administration recently adding a further seven million acres to the NPR-A, oil should be pumping from the North Slope for a long time to come.
Misleading Argument #7: “Imported Oil Too Costly”
7. In 2004 the US imported an average of 58% of its oil and during certain months up to 64%. That equates to over $150 billion in oil imports and over $170 billion including refined petroleum products. That’s 19.9 million dollars an hour! Including defence (sic) costs the number would be nearly a trillion dollars.
7. There is no doubt that America imports too much oil and that regular Americans are paying the price. However, drilling is not the solution. Not only would opening the Arctic Refuge not lower oil or gas prices because both are set by an international standard, but by simply raising the minimum mile-per-gallon requirements for automobiles- known as CAFE standards- by a few miles-per-gallon to 1987 levels, America would save 10 billion barrels over the next twenty years. That is more than three times the theoretical output of the Arctic Refuge.
Misleading Argument #8: “No Negative Impact on Animals”
8. Oil and gas development and wildlife are successfully coexisting in Alaska’s arctic. For example, the Central Arctic Caribou Herd (CACH) which migrates through Prudhoe Bay has grown from 3000 animals to its current level of 32,000 animals. The arctic oil fields have very healthy brown bear, fox and bird populations equal to their surrounding areas.
8. This is absolutely false- the impact on animals would be huge. The Department of Interior conservatively estimates that 40 percent of the Porcupine caribou herd would be severely affected, and due to the fact that the coastal plain is the breeding ground for over 70 species of birds as well as the only regular denning area for polar bears on American soil, the population losses would almost certainly be huge, especially for species like the snow goose. A 2002 USGS report even stated clearly that developing the Refuge would make it impossible, even under the best possible conditions, for the Porcupine caribou herd to increase in numbers and would likely decrease at a minimum rate of 8.2 percent per year. It also noted that the effects of drilling would have a larger relative effect on the Porcupine caribou herd than on the other herds. The population gains of the CACH can be almost entirely attributed to near-perfect breeding conditions during recent years, and several studies have indicated that the Prudhoe Bay oil fields kept population levels lower than they should have been.
Misleading Argument #9: “Arctic Technology”
9. Advanced technology has greatly reduced the “footprint” of arctic oil development. If Prudhoe Bay were built today, the footprint would be 1,526 acres, 64% smaller.
9. This is one of the main reasons Americans should worry about the “2,000-acre footprint” proposed for the Arctic Refuge. Development at Prudhoe Bay has permanently altered approximately 400 square miles of formerly pristine wilderness and now is one of the world’s largest industrial complexes, with more than 1,500 miles of roads and pipelines and thousands of acres of industrial facilities. It has around 400 oil spills every year of thousands of barrels of oil, and it emits twice the pollution of Washington, D.C. If the Arctic Refuge is opened- and the full 2,000 acres is used- it is not difficult to imagine the disastrous consequences.
Misleading Argument #10: “Alaskans Support”
10. More than 75% of Alaskans favor exploration and production in ANWR. The Inupiat Eskimos who live in and near ANWR support onshore oil development of the Coastal Plain.
10. Many Alaskans support drilling because they would be the main economic recipients of lease profits; the Alaskan Legislature would receive between 50 and 90 percent of total revenues. However, not all Alaskans are in favor by any stretch of the imagination. The Gwich’in tribe, who depend on the Porcupine caribou herd for survival, are adamantly against developing the Refuge. And recently there has been a grassroots movement even among the Inupiat Eskimos in favor of saving the Refuge.
Act Now!
The biggest battles over the Arctic National Wildlife Refuge will be fought in the coming weeks and months on the floors of Congress. Contact your Senators and Representatives now by going to our How You Can Help page and tell them to save the Arctic Refuge, one of America’s last true natural wonders.