The new oil production tax system is working and doing what it’s suppose to do – spur new investment to increase oil production and generate more revenues, especially in a low oil-price environment. Alaska is seeing increased activity across the North Slope and in Cook Inlet thanks to a much improved business climate created by oil production tax reform. The new tax system has allowed the state to better compete for the capital needed to advance Alaska projects and stem the decline in North Slope production, Moreover, there is high potential for new discoveries in the Arctic, both onshore and offshore. In the near term, oil will come mostly from producing fields onshore, which may have about five billion barrels of conventional oil remaining. There are other known but not yet producing fields on state land that could hold two billion barrels. Federals areas onshore and offshore may contain up to 36 billion barrels of oil. A U.S. Department of Energy report estimates the recoverable oil reserves on the North Slope to be 22 billion barrels, including reserves from existing fields, as well as undiscovered resources. Natural gas estimates reach as high as 124 trillion cubic feet (tcf). A revised 2011 U.S. Geological Survey assessment of the National Petroleum Reserve-Alaska (NPR-A) resulted in an estimate of 900 million barrels of oil and 17.5 tcf of natural gas. An assessment of the 1002 Area of Arctic National Wildlife Refuge (ANWR) gave a mean estimate of 10.4 billion barrels of technically-recoverable oil. The Alaska Outer Continental Shelf constitutes one of the world’s largest untapped resources potentially reaching as high as 26 billion barrels of oil and 132 tcf of natural gas, with the majority being in the Chukchi Sea. In February 2008, the second most successful oil and gas lease sale in the history of the United States took place, covering millions of acres in the Chukchi Sea. The sale raised a record $2.7 billion in federal revenue. After more than 37 years of production, the North Slope still has a large amount of the discovered oil and gas in place. The industry is actively pursuing new ways to develop these remaining, more challenging resources such as heavy and viscous oil, light oil from small, more remote fields, and natural gas, including gas hydrates. If the technical and economic hurdles can be overcome, heavy oil development will be important to sustaining Alaska’s oil production long into the future. The size of the resource is significant, but so are the challenges as the oil is thick and sticky, and will require new kinds of wells and processing. The Ugnu heavy oil deposit beneath Prudhoe Bay is estimated to hold 20 billion barrels of oil in place. Conservative estimates suggest recovery rates of about 10 percent. The North Slope also holds large known deposits of viscous oil, which is a type of heavy oil but not as thick. In recent years, viscous oil production on the North Slope was about 41,000 bpd. With evolving technology, more production will come from this resource. In addition, the North Slope is rich in source rocks that have the potential to deliver a successful unconventional shale-based oil and natural gas resource play. Alaska’s shale potential is only just emerging as the industry’s focus to date has been on conventional oil and gas production.
What is the Energy
But the problem lies in nuclear reactors and radioactive waste, and the possibility of radioactive leakage or explosion
