Alaskan Oil Boom

Report Outline
Problems in North Slope Development
Challenge of the Arctic Environment
Economic Importance of North Slope Oil

Problems in North Slope Development

Oil Bonanza on Arctic Shore of 49th State

A new Frontier is taking shape on the chill northern coast of Alaska, a few hundred miles from the North Pole. Here, in an area known as the North Slope, frostbitten oil crews are working around the clock to exploit what geologists predict will be one of the world's most significant oil discoveries. Implications of the strike are enormous, both for the world oil market and for development of the nation's 49th state.

The oil industry's confidence in the Slope's potential was indicated by the results of a lease sale Sept. 10, 1969, in which oil companies agreed to pay the state government more than $900 million for drilling rights on 450,858 acres of land in the vicinity of Prudhoe Bay, an area in which two companies had made major discoveries in 1968. Because of the furious competition for leases, which is expected to continue until a second lease sale is held in 1970 or 1971, oil companies have declined to announce results of their recent drilling activities. But estimates of 5 billion to 10 billion barrels of oil from the Prudhoe field alone and of 50 billion barrels from all Alaskan oil fields are generally considered conservative.

Despite the high costs of Arctic exploration for oil and the long distances to market, some economists believe a discovery of the size of the North Slope field will eventually drive down domestic prices of petroleum products and even enable American oil to compete with Middle East oil in some foreign markets. If the industry is successful in its efforts to establish a dependable tanker route through Arctic waters from Prudhoe to the U. S. East Coast, a major shift in East-West trade patterns is thought likely to result.