Biden Administration stops ANWR development

[Deleted member 28227]

To be clear, in the report for area 1002 aka ANWR generated under the Trump administration it would take 10 years for drilling to commence, assuming a successful sale and capital commitments. So whatever thoughts you have about the state of US oil consider what we will be doing in 2040 as that’s really when this thing would have been in peak development.

The sale was not successful with leasing going to the state not operators and pre-sale Wall Street gave it a pass.

 

[Deleted member 28227]

It’s not a shale field so the comparison is not correct. Huge difference in methods, extraction costs etc. No company wants to extract oil up there because the costs are the same...there is a savings.

Personally I am neutral on ANWAR. I have been to Alaska several times and seen the remoteness and beauty. That said, I doubt anyone typing on here has ever been or will ever be going to ANWAR. It nice to think about it as the Yellowstone of the north but with boots on the ground the feel would likely be far different.

While I think the transition away from fossil fuels will certainly happen, I also think staying energy independent from the Middle East is not a bad thing.

Um yeah ANWR is way more expensive soup to nuts. It's not just the cost to drill a wells it's the cost to build all the infrastructure + risk of exploration.

Shrapnels comment was we should drill where there is oil... so you know maps of hydrocarbons, and some numbers which demonstrate we are talking about a similar PUD value to California.

Point being there is 20x more oil in close proximity to the gulf, on pipe, with rigs running than there is in ANWR.

The whole ANWR thing is such a joke because the oil industry basically said don’t do this we don’t want it. (Proof um.. no one bid on it)

As far as the industry goes, we’re struggling with an image problem already and dealing with frack bans all over; CO is a mess, we’re getting heat in Texas in places like Denton, the dominion pipe has been a struggle from the get go... you wanna know what would be a great idea let’s put ANWR on the table and just stir the hornets nest. Why not it’s hugely unpopular and it’s not even somewhere we want to drill right now .

We talk about shooting holes in the boat in the hunting industry, well... ANWR is shooting holes in the OG boat.

This isn’t industry driven it was purely a political stunt.

 

[BearFoot]

People Live in ANWR. No mention ever of what the folks in Kaktovik think. The Gwichʼin who oppose do not, but are often Quoted.

"The Alaska National Interest Lands Conservation Act (1980) established the Arctic National Wildlife Refuge (ANWR) (fig. 1). In section 1002 of that act, Congress deferred a decision regarding future management of the 1.5-million-acre coastal plain ("1002 area") in recognition of the area’s potentially enormous oil and gas resources and its importance as wildlife habitat."


Should development occur, those areas will be the most studied and most documented wildlife refuges. You will not be able to hunt or trap there, in the oil lease areas, but the rest is open and just needs to be booked.
I've worked in a number of arctic villages and arctic oil fields. Wildlife is abundant in a lease area, where it is protected.

 

[mdhunter]

The whole ANWR thing is such a joke because the oil industry basically said don’t do this we don’t want it. (Proof um.. no one bid on it)

Well, as a self professed "neutral" on ANWAR you just swung my vote. Not bid for a reason I assume...

 

[Deleted member 28227]

Well, as a self professed "neutral" on ANWAR you just swung my vote. Not bid for a reason I assume...

1. Bad economics
2. Banks said they wouldn’t fund it
3. Perception
4. Assumed Biden would do this

All the majors are trying to green up their image, everyone took a massive stock hit in 2020. Look at the market cap of OXI then compare it to before they did the Anadarko deal and what Anadarko was worth... look at Exxon getting booted from the DOW.

There were an egregious number of bankruptcy’s last year. It is a rough time for OG to get capital right now, certainly a lot of it was bad business practices but it doesn’t change the fact that we as an industry need to work hard to instill confidence.

ANWR 2020 is just bad market timing.

If oil was at $90 a barrel, banks were searching for new projects and domestic consumption was outstripping production, well we’d be having a different conversation.

A lot of the materials you find about ANWR; reserve reports, feasibility studies etc. were all done in 2017 and assume a WTI price of $67.25.

 

[Irrelevant]

BP's oil exploration team swept aside in climate revolution: Reuters | Upstream

Geologists and scientists diverted to renewable division

www.upstreamonline.com

 

[Deleted member 28227]

BP's oil exploration team swept aside in climate revolution: Reuters | Upstream

Geologists and scientists diverted to renewable division

www.upstreamonline.com

"BP last year also wiped $20 billion from the value of its oil and gas assets after slashing its outlook for energy prices. At those lower price assumptions, BP no longer considered many of its oil and gas reserves worth developing."

I assume AK was in there... obviously

 

[Bambistew]

I'm neutral on drilling in ANWR I don't think it will be some environmental disaster waiting to happen, nor do I think the area that would be developed will really have much of an impact financially to the state. We're in such a large deficit hole, there is no coming out of it, certainly not by adding production on federal land. The state won't see any royalty from it other than TAPS. I look at it in terms of is it economically viable and what will it really provide to the state. I really don't think it will ever be economical, at least not in the next 10-20 years. I think the net benefit to the state would be a thousand jobs at most, and most of those would just be sustaining existing jobs as fields/wells are depleted elsewhere up there. I don't see it being some hiring boom, but rather just augmenting continued work for the existing workforce that will continue to decline. Its not really going to have much of an impact on our failing economy.

There is too much cheap oil in the L48. Alaska is at the mercy of not only the rest of the world but also L48 interest and at $50bbl, most wells in on the Slope are really not that economical anyway.

I honestly think the Keystone deal is being driven by money rather than by the environmentalist. I honestly do not believe that politicians are doing it out of the goodness of their hearts to "save" the environment. They are getting something out of it from someone. I think a pipeline is far more complex than being environmentally detrimental, but that's the easy sell.

ANWR will not make or break AK's future. We have a population of 720,000. Of that there is around 320,000 employable people, exclude government and we're at 240,000. Of that there is about maybe, 140-120,000 that work jobs above the poverty level, aka the potential tax base. A very large percentage of the workforce is tied to oil/gas I hear numbers of 1:4, but I think they stretch that out a little. The current fiscal gap is about $2.5B, or around $15,000 pp who has a decent job. A 7-10% income tax is estimated to generate around $1-1.25B... If they put in an income tax of that magnitude, many of those high wage earners will leave, and we'll be stuck with a tax base that generates very little tax. We are not going to tax our way into filling the fiscal budget gap and oil isn't going to save us. There are too many on the gov't tit.

 

[BWALKER77]

It’s not a shale field so the comparison is not correct. Huge difference in methods, extraction costs etc. No company wants to extract oil up there because the costs are the same...there is a savings.

Personally I am neutral on ANWAR. I have been to Alaska several times and seen the remoteness and beauty. That said, I doubt anyone typing on here has ever been or will ever be going to ANWAR. It nice to think about it as the Yellowstone of the north but with boots on the ground the feel would likely be far different.

While I think the transition away from fossil fuels will certainly happen, I also think staying energy independent from the Middle East is not a bad thing.

I've been there as mentioned before. It's far from Yellowstone.

 

[BigHornRam]

How do you reduce world gasoline consumption other than the effects of a global pandemic? Make it more expensive. How do you make it more expensive? Restrict the production of oil. The green agenda is moving forward. Prepare for higher energy costs, they are coming.

Davos Agenda: What to know about how to save the planet | World Economic Forum

 

[VikingsGuy]

I find it interesting that a third of renewables are hydro, yet when was the last hydro plant constructed. Also interesting that CA doesn't consider large scale hydro "renewable" because of habitat impacts.

Personally I don't think current solar tech is a particularly good solution, outside of small privately owned panels. With more people working from home, a trend that might continue? I think some of the duck curve arguments are less valid.

Seems like nuclear is probably are only realistic short term (50 year) option for reducing fossil fuel use. A lot of concerns with nuclear stem from designs that are 50-60 years old and don't reflect current technology.

Next Generation Nuclear Power

New, safer and more economical nuclear reactors could not only satisfy many of our future energy needs but could combat global warming as well

www.scientificamerican.com

A next gen (and later a further next gen) nuclear is the only energy option that actually stands up to real math when we are looking to wean the globe off of oil/gas/coal. And it is actually a technology that many climate change naysayers seem to support - so there may actually be a coalition in the middle big enough to move this forward if it would quit enabling the extremes of the debate -- but then again, when has that happened on any issue in the last 30 years - sigh

 

[BigHornRam]

Hype or hope?

Jeff Bezos Is Backing an Ancient Kind of Nuclear Fusion

This tech could be more practical than tokamaks.

www.popularmechanics.com

 

[BWALKER77]

How about CO2 scrubbing technology? That makes more sense to me at this point.

 

[SAJ-99]

How do you reduce world gasoline consumption other than the effects of a global pandemic? Make it more expensive. How do you make it more expensive? Restrict the production of oil. The green agenda is moving forward. Prepare for higher energy costs, they are coming.

Davos Agenda: What to know about how to save the planet | World Economic Forum

Yes, and rightfully so. The price of gasoline on an inflation adjusted basis hasn’t changed in 40yrs. Population up 75%, emerging economy development means vehicles have more than doubled. Just thank fracking for increased production and prepare for higher prices in the future. The alternative is sucking every drop you can out of the ground until their is an event that causes a catastrophic shortage. The more diversity we have the better. Let higher prices drive that change.

 

[VikingsGuy]

Yes, and rightfully so. The price of gasoline on an inflation adjusted basis hasn’t changed in 40yrs. Population up 75%, emerging economy development means vehicles have more than doubled. Just thank fracking for increased production and prepare for higher prices in the future. The alternative is sucking every drop you can out of the ground until their is an event that causes a catastrophic shortage. The more diversity we have the better. Let higher prices drive that change.

I typically support allowing markets, supply and demand to set prices -- but what some propose is to artificially restrict/regulate supply and demand to achieve a political objective. $5 gas in 2024 is not an economic outcome, it is a political outcome. The real answer is to promote better, faster cheaper alternatives, not to create a race to the economic bottom by artifically jacking up the cost of energy production.

 

[pilsner]

I find it interesting that a third of renewables are hydro, yet when was the last hydro plant constructed. Also interesting that CA doesn't consider large scale hydro "renewable" because of habitat impacts.

Personally I don't think current solar tech is a particularly good solution, outside of small privately owned panels. With more people working from home, a trend that might continue? I think some of the duck curve arguments are less valid.

Seems like nuclear is probably are only realistic short term (50 year) option for reducing fossil fuel use. A lot of concerns with nuclear stem from designs that are 50-60 years old and don't reflect current technology.

Next Generation Nuclear Power

New, safer and more economical nuclear reactors could not only satisfy many of our future energy needs but could combat global warming as well

www.scientificamerican.com

If someone opposes nuclear power but floggs solar power they are just a hypocrite from a distance.

 

[BigHornRam]

How about CO2 scrubbing technology? That makes more sense to me at this point.

$100 million for your best idea....

Elon Musk is donating a $100 million prize for carbon capture technology — here's what that means

Carbon capture, utilization and storage or sequestration is a process of removing carbon emissions to either store or reuse.

www.cnbc.com

 

[SAJ-99]

I typically support allowing markets, supply and demand to set prices -- but what some propose is to artificially restrict/regulate supply and demand to achieve a political objective. $5 gas in 2024 is not an economic outcome, it is a political outcome. The real answer is to promote better, faster cheaper alternatives, not to create a race to the economic bottom by artifically jacking up the cost of energy production.

I agree free markets would be great, but we have to be honest and say they don’t exist. Never have. We have a lot of economic “nudging”. O&G gets tax incentives that benefit smaller players. The entire MLP industry was built on a special tax benefit. Ethanol gets a special tax break. And we know solar, wind, etc. have them. Despite that solar has still come down in cost enough to replace coal. Previous admin put a tariff on China solar panels or the cost would be even lower.

Free markets are a dream and the working American pays the country’s bills. You could argue free markets are the reason manufacturing moved to China. That is how we got better, cheaper alternatives in almost everything. At some point, the tradeoff is we have to pay more for the outcome we desire. Better to do it slowly than be forced to do it later.

 

[BigHornRam]

Despite that solar has still come down in cost enough to replace coal. Previous admin put a tariff on China solar panels or the cost would be even lower.

Can I get some facts to back up these claims. Thanks.

 

[SAJ-99]

Can I get some facts to back up these claims. Thanks.

Your aversion to Google search will be the end of me.
In the US, nat gas is the 800lb gorilla. Mostly because it is sourced and used in a localized fashion. If you view the situation globally, places like India for example, renewables have already matched the cost of O&G because the inputs have to be imported where solar is more localized.

https://www.lazard.com/media/451419/lazards-levelized-cost-of-energy-version-140.pdf