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In response to continued high gasoline prices, President Joe Biden recently announced an extension of withdrawals of approximately 1 million barrels per day from the Strategic Petroleum Reserve (SPR), the emergency petroleum stockpile from the country. We could get at least as much oil from additional domestic drilling. Alaska’s Arctic National Wildlife Refuge (ANWR) alone has the potential to supply up to 1 million barrels a day, but drilling there has been blocked by the Biden administration since inauguration day . Here are five reasons why ANWR is a superior oil source to SPR.
1. ANWR would provide additional oil, not borrowed oil that has to be repaid
The SPR contains produced oil previously purchased by the federal government and held in reserve for emergencies. Due to withdrawals from the Biden administration over the past few months, the SPR is currently at a 30-year low and will at some point need to be recharged if it is to be available again. Indeed, energy markets recognize that SPR must be repaid barrel for barrel, which is one reason exploiting it rarely lowers oil prices as much as hoped. In contrast, the ANWR would of course never need to be recharged and could therefore be a real complement to oil supplies. It’s like the difference between an unemployed person taking out a bank loan to meet expenses or getting a new job.
2. ANWR would supply oil for decades rather than months
SPR withdrawals of 1 million barrels per day can only last a few months before the reserve becomes dangerously low – in fact, we are already there. But, as shown by the fact that the drilling around Prudhoe Bay in Alaska – the most similar project to ANWR – exceeded 40 years of production, ANWR would most likely add daily to national oil supplies for a long time to come. At its peak, ANWR is estimated to be capable of supplying an average of 880,000 barrels per day and possibly more.
PIPELINE EXPANSION IN PACIFIC NORTHWEST OPPOSED BY ENVIRONMENTAL GROUPS
3. ANWR generates revenue while SPR costs them
The SPR, like all federal programs, requires taxpayers’ money to maintain and operate. Unlike the SPR’s drain on government resources, ANWR’s development costs would be borne entirely by the private sector. In addition, ANWR would generate rental, royalty, and income tax revenue that one estimate could total $150 billion to $296 billion for the federal government and the state of Alaska.
4. Unlike SPR, ANWR does not strain existing infrastructure
An underrated downside of the SPR is that its storage facilities in Louisiana and Texas are located near an oil boom. As it stands, the infrastructure needed to transport oil from this region to refineries, refine it, and get refined products to customers is already at or near capacity, with occasional bottlenecks. To the extent that we should make room in the system for SPR oil by reducing domestic production, the whole objective is defeated. In contrast, ANWR oil would be transported through the currently underutilized Trans-Alaska Pipeline and could then be shipped to one of the many refineries that need it.
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5. Locals support ANWR drilling, but not SPR pullouts
In Alaska, drilling in the ANWR has huge, bipartisan support, thanks to the aforementioned revenues as well as projected job creation in the tens of thousands. And, judging by their elected leaders, most Louisianans and Texans alike support local oil production and see the Biden administration’s pullouts from the SPR as a poor substitute for real drilling.
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Granted, ANWR drilling cannot happen instantly. But the mere fact that so much future oil is on the way would have a beneficial effect on current prices.
Unfortunately, the reason Biden would rather borrow oil than drill is the climate change-inspired fantasy that we’ll only need fossil fuels for a little longer before his ‘incredible transition’ to clean energy. does not settle. Tapping the SPR to cut prices is a short-term fix that’s part of the administration’s wishful thinking, while the ANWR and other national drills are a sensible long-term response to the pain at the pump. , not only for today but for years to come. .
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