WASHINGTON — Senate Energy and Natural Resources Committee Chairman Lisa Murkowski, R-Alaska, released legislation Wednesday that would open Alaska’s Arctic National Wildlife Refuge to oil and gas drilling for the first time in a generation by calling for at least two major lease sales over the next decade.
The budget measure directs federal officials to auction off mineral rights in areas encompassing at least 400,000 acres each in the refuge’s coastal plain, also known as its “1002 area.” The measure requires at least a 16.67 percent royalty rate and dictates that the revenue would be evenly split between the federal government and Alaska.
Surface development on the coastal plain must not span more than 2,000 acres, according to the bill.
Murkowski, who has scheduled a markup on the bill for Nov. 15, said the measure represents “a tremendous opportunity for both Alaska and our country.”
The Congressional Budget Office estimated in a report published Wednesday that such sales, the first of which must take place within four years of the bill’s enactment, would raise nearly $1.1 billion over the next decade. The money would help offset tax cuts Republicans hope to enact as part of a broader tax reform bill.
“Estimates of bonus bids for leases in ANWR are uncertain,” the CBO cautioned.
Environmentalists have questioned those projections, noting that recent sales on Alaska’s North Slope have failed to produce the level of revenue that would generate that much money. Given the costs of exploration in the Arctic, oil prices typically must be at least $70 a barrel to justify drilling. Right now, West Texas crude is selling for just under $57 a barrel.