Significant oil reserves that are presently not available for extraction are fou

Question

Significant oil reserves that are presently not available for extraction are found in the Alaska National Wildlife Refuge—ANWR. The United States Department of Energy (DOE) has predicted that if these reserves were placed in production, they could eventually supply about 0.78 million bbl per day peak production. Moreover, DOE estimated that it would take about ten years after extraction activities began to reach this production point. Present U.S. oil consumption is 20 million bbl per day. What percent of the total U.S. daily oil consumption would be provided by the ANWR oil reserves at their peak production? Would oil production from the ANWR reserves greatly increase oil availability for the U.S.? Explain

Explanation / Answer

The predicted oil reserves at Alaska National Wildlife Refuge—ANWR is capable of produce 0.78 million bbl per day peak production. But it would take 10 years after extraction activities began to reach this production point. Present U.S. oil consumption is 20 million bbl per day. Thus, {(0.78 / 20 ) * 100 } or 3.9 % of the total U.S. daily oil consumption would be provided by the ANWR oil reserves at their peak production. Many of USA's old oil fields are completely sucked up and thus the country is dependent on the foreign market for crude oil, thus production from ANWR would definitely help the USA to maintain its oil budget.

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