[Congressional Record Volume 144, Number 106 (Friday, July 31, 1998)]
[Senate]
[Pages S9608-S9609]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           U.S. GEOLOGICAL SURVEY ESTIMATES OF THE 1002 AREA

 Mr. MURKOWSKI. Mr. President, the Nation's gold repository at 
Fort Knox, Kentucky is an acknowledged asset--cuddled, counted and 
cared for.
  But the Nation has a potential ``black gold'' repository under the 
Arctic Oil Reserve (AOR) that is largely ignored by the 
Administration--denied, discounted and disputed.
  Should someone try to tunnel under Fort Knox to borrow a few tons of 
gold from the vaults, retribution would be swift--remember 
``Goldfinger''?
  Yet safe, environmentally sound development at the edge of ANWR at 
the Sourdough site could potentially siphon off barrels of oil 
belonging to the U.S. Government. Where is James Bond when we need him?
  Certainly not in the person of Secretary of the Interior Bruce 
Babbitt, the purported watchdog of the Nation's natural resources.
  To the contrary, Secretary Babbitt put his head in the tundra back in 
1995 and pronounced the Arctic Oil Reserve's oil possibilities to be 
very low at about 898 million barrels.
  In May 1998, the Secretary's own scientists at the U.S. Geological 
Survey begged to differ. Their estimate based on three years of work by 
more than 40 geologists and other professionals is that a mean of 7.7 
billion barrels of producible oil may reside in the 1002 Area of the 
AOR.
  In the interest of looking at this amazing leap in the estimate of 
ANWR's producible oil, I chaired a hearing of the Senate Energy and 
Natural Resources Committee last week, and invited the U.S. Geological 
Survey to participate.
  Three things rang clear at that hearing.
  First, while these estimates were the highest ever and proved the 
1002 area of the AOR has the greatest potential of securing our 
Nation's energy needs--they were extremely conservative.
  For instance, these estimates were based on a minimum economic field 
size of 512 million barrels. When in practice the minimum economic 
field size in Alaska is much lower than that.
  Northstar: 145 mm/bb (With a sub-sea pipeline) is deemed economic; 
Badami: 120 mm/bb is deemed economic; Liberty: 120 mm/bb is deemed 
economic Sourdough: 100+ mm/bb (adjacent to AOR) is deemed economic.
  The Second fact that rang clear is while these new estimates show a 
clearer picture of the Western portion of the AOR, much remains unclear 
about the oil and gas potential of the massive structures present in 
the Eastern portion.
  While the USGS has slightly downgraded the potential of that specific 
area, they do not have the data that industry has from actually 
drilling a well.
  And I can assure you that those with knowledge of what that well 
contained--the select few--remain very optimistic about the potential 
oil and gas reserves of the Eastern portion.
  Third, technology has increased so dramatically that we can now 
extract greater amounts of oil from wells with far less impact on the 
environment at a cost 30% less than 10 years ago.
  Consider this, Mr. President. In June of 1994, Amerada Hess concluded 
the Northstar field in Alaska was uneconomic because development would 
exceed $1.2 billion and eventually sold the field to BP.
  Today, BP expects to begin production of that field's 145 million 
barrels of reserves in 2000. Estimated development costs: $350 
million--a 70% reduction from just 4 years ago.
  Mr. President, all these factors point toward the logical conclusion 
that underlying the 1.5 million-acre oil reserve in Alaska lies greater 
reserves than recently estimated, and we need to confirm them with 
better science.
  Dr. Thomas J. Casadevall, acting director of the USGS, was very clear 
in

[[Page S9609]]

his explanation that if the newer three dimensional (3D) seismic data 
were available from the Arctic Oil Reserve, their high May estimates of 
producible oil could soar even higher.
  Casadevall explained that their new estimates, while supported by 
sound science and peer review, were still based on 2D seismic tests 
done more than a decade ago.
  Kenneth A. Boyd, director, division of Oil and Gas of the Alaska 
Department of Natural Resources, likened the advance of the new testing 
to the difference between an x-ray and a CAT-scan.
  He said the available information from 2D seismic as opposed to 3D 
seismic is that the former produces a line of data while the latter 
produces a cube of data. The cube can be turned and examined from all 
sides and the geologic information proves invaluable for exploration.
  This data has revolutionized exploration and development of the North 
Slope of Alaska. Modern 3-D data provides enhanced and incredibly 
accurate imaging of potential subsurface reservoirs.
  This in turn reduces exploration and development risk, reduces the 
number of drilled wells, and in turn reduces both overall costs and 
environmental impacts.
  Of course the Administration is under little pressure to allow 
testing or exploration of the Coastal Plain with gas prices at a 30-
year low. However, the Department of Energy's Information 
Administration predicts, in ten years, America will be at least 64 
percent dependent on foreign oil. It would take that same ten-year 
period to develop any oil production in AOR.
  Therefore, it seems prudent to plan ahead to protect our future 
energy security.
  I intend to introduce legislation that would allow 3D seismic testing 
on the Coastal Plain. This testing leaves no footprint. In fact, just 
last year the U.S. Fish and Wildlife Service allowed such testing to be 
done in the Kenai National Wildlife Refuge, declaring such testing 
would have ``no significant impact.''
  It would have even less impact on the frozen tundra in ANWR. It is 
also a possibility that the oil industry would be willing to share in 
the cost of such testing. Let's at least find out what kind of resource 
we are talking about.
  It the Nation were to be crunched in an energy crisis--like the Gulf 
War--that would require the speedup of development; that development 
could impact the environment negatively because it would not have the 
benefit of thoughtful planning.
  I believe it is as criminal as stealing gold to refuse to acknowledge 
the potential for producible oil in the Coastal Plain of the AOR. If we 
don't know what the resource is, how can we protect it or make an 
informed decision about its use?
  And how can those in this Administration or the environmental 
community argue it is a bad idea to seek a greater understanding of our 
public lands?
  If we are just guessing that the Sourdough drillers may have tapped 
an underground AOR vein then we deserve to lose the resource. It is 
time to get rid of the guesswork and 3D testing will help to do 
that.

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