Alaska -- Oil and Forget-Me-Nots

CHATTERTON, C.V., STANDARD OIL CO. OF CALIFORNIA, ANCHORAGE, ALASKA MEMBER AIME

Abstract

The oil industry singularly provided major justification for Alaskan statehood and continues to play a responsible role in the State's very existence. One out of every three dollars of current State revenue is a direct oil dollar. Alaska offers a safe haven for oil investment, and leasing regulations provide incentive for exploration. The combination of Alaska's climate, terrain and remoteness presents a unique challenge to operators and makes the cost of doing business high. Air and water transportation plays an important role. Alaska's potential has barely been scratched. Offshore drilling offers new hope. Scheduled early completion of a refinery insures that Alaska will be a fully integrated oil state. Also, the State's natural-gas potential is great.

Introduction

Oil men everywhere are interested in Alaska. The frontiersman spirit is kindled by Alaska's everyday challenges. Indeed this spirit is required to encourage the continuing search for oil so necessary to convert this infant state into a major producer of hydrocarbons. Alaska got off to a flying start in 1957 with a major discovery, the Swanson River field. Nearly six years later, private enterprise is still looking for Alaska's second major oil discovery. The success ratio since then has been low; nevertheless, enthusiasm for the oil potential of this great state has been far from diminished. To date, the surface has barely been scratched. This paper reviews the infant years of the industry in Alaska. This baby is continuing to be fed at ever-increasing rates with exploration and development dollars. New operators are continuing to accept the challenge of drilling in Alaska. To better understand the challenge this infant faces, the environment into which the babe was born must be understood. This state is the land of the forget-me-not, Alaska's floral emblem which is the hallmark of friendship and fidelity. Alaska is an enormous, beautiful and challenging country. This is a land of long summer days with its floor carpeted in wild flowers and forget-me-nots. Alaska is vast. In aerial extent, it is nearly one-fifth as large as the "South 48," and with more coastline than the entire Continental United States. It is more than twice the size of Texas with less than 2 1/2 per cent of the population of Texas. In fact, the population density is 0.4 of a person/ sq mile, compared with 36.2 people/sq mile in Texas. The 0.4 figure includes 35,000 Indians, Aleuts and Eskimos out of a total population of 226,000. This thinly populated country is unique. Alaska desperately wanted to become a state. The promise of oil aided in making Alaska eligible for statehood. Quoting Alaska's Governor William Egan, "The discovery of oil was instrumental in providing an economic atmosphere favorable for Statehood".

Understanding Alaska

Geography

Geographically speaking, Alaska consists of over 375 million acres.

JPT

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