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Climate worries complicate Alaska drilling plan

Lease sales could produce 15 billion barrels of oil, but environmentalists say drilling would threaten already melting habitat.

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Reporter Brad Knickerbocker discusses a proposal by the US Department of the Interior to drill for oil and gas in Alaska, in an important habitat for polar bears.

A controversial proposal to extract vast supplies of oil and gas from Alaska's outer continental shelf pits America's energy needs against environmental protection. Unlike similar clashes in the past, there's a complicating factor this time: global warming.

The US Interior Department's Minerals Management Service (MMS) is offering the sale of oil and gas leases covering nearly 46,000 square miles in the Chukchi Sea off the northwest coast of Alaska.

Initial geological studies indicate that the area, roughly the size of Pennsylvania, has the potential to produce 15 billion barrels of recoverable oil and 77 trillion cubic feet of natural gas. Together with the potential energy development from lease sales offered recently in the nearby Beaufort Sea, that's enough to fuel 25 million cars and heat 46 million homes for 30 years.

"It's a significant slice of the energy we consume, based upon current rates," says Richard Ranger, an adviser with the American Petroleum Institute, an industry group. "The potential, we would argue, is of strategic significance."

The proposal comes at a time when moratoriums on new leases, as well as restrictions on exploration in the Arctic National Wildlife Refuge and two areas of the outer continental shelf in the Atlantic and Pacific, "have had the effect of really limiting where we can look for energy Americans need," says Mr. Ranger.

At the same time, with new exploration and drilling technologies, the odds of success are becoming more favorable.

The Gulf of Mexico, for example, is generally seen as a mature site for oil. But recent advances allowing offshore rigs to drill deeper has led to discoveries since the mid-1990s that have essentially yielded the equivalent of the amount imported from Saudi Arabia, says Ranger. Natural-gas production there has increased fourfold over the same period.

In the Rocky Mountain states – New Mexico, Colorado, Utah, Wyoming, and Montana – the ability to extract natural gas from coal seams and other technological advances mean the region now produces 20 to 25 percent of the nation's gas. That figure could increase to as much as 40 percent by the 2020s.

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