E&E News: “Republicans Need Big Offsets for Tax Cuts. Drilling May Not Deliver.”
RFF Fellow Brian Prest reflects on whether lease sales for fossil fuel extraction on federal lands will be enough to pay for proposed federal tax cuts.
Still, analysts say the potential for [the Alaska National Wildlife Refuge (ANWR)] and other oil and gas drilling to make up significant holes in the federal budget is still far from likely.
“I’ve seen the numbers thrown around that $5 trillion is needed, but the amount of revenue you get from oil and gas leasing is tiny compared to that,” said Brian Prest, an economist and fellow at Resources for the Future. “What’s also important to note … [is] it’s almost all coming from royalties.”
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ANWR is highly remote, largely undeveloped for oil and gas extraction and unforgiving in climate — making it a costly and risky venture for potential prospectors. “I think there’s a lot of risks in ANWR and Alaska more generally,” Prest said. “If you look at where the growth in oil development is coming from, particularly on federal lands, it’s really coming from the Permian Basin. … I would expect the changes in development there to be way bigger than what you might get from ANWR, especially in the near term.”
